Yesterday, I wrote about a scam possibly connected to the economic stimulus package Social Security payments. Unfortunately, that is not the only scam to be seen during this recession. As always, understand that if it sounds too good to be true, it probably is.

Also, be aware that you can get information you need via the government. Recovery.gov offers information about what you are entitled to under economic stimulus measures, and how to get it. In many cases you do not have to do anything. Be on your toes against the following two scams, designed to take advantage of those who are looking forward to money from the government:

1. Mortgage foreclosure consultants. These have been popping up with increasing frequency as people seek to avoid foreclosure. With President’s foreclosure prevention plan in the news, this type of scam is likely to proliferate even further. The scammers often get you to sign over the title of your home, or even promise to negotiate a loan modification — if you provide an upfront fee. The scammer disappears with your property. Do not work with someone who cold calls you or comes to your door. Instead work with a housing counselor approved by HUD.
2. Economic stimulus grants. Scammers want to convince you that they have “insider” information on getting free government grant money. You pay a fee, and get information about government grants. Sometimes you do not actually get information. In actuality, the “insider” information is what you could get for free by visiting sba.gov and grants.gov. Watch out especially for those promising to help you get grants to pay off student loan debt or other personal debt; they don’t exist.

Keep your eyes peeled for fraudulent information and attempts to get your money. It’s sad but true: In these tough times scammers will make money by preying on those who can least afford to be scammed.

Although distribution of tax rebates (estimated at $ 106.7 billion) only began in the 2nd quarter of 2008, 1st quarter statistics from the US Bureau of Economic Analysis showed improvements in the US economy.

Gross Domestic Product grew 1.0% in the 1st quarter of 2008 versus only 0.6% in the 4th quarter of 2007. Profits of financial corporations increased by $ 14. billion against a $74.4 billion decrease in the preceding quarter –indicating some recovery from the subprime crisis. Overall corporate profits decreased by only $5.2 billion in the 1st quarter of 2008 versus a $ 52.9 billion decrease in the 4th quarter of 2007.

What about Fannie Mae & Freddie Mac? (in the next posts) 

image from Microsoft Clipart, graphics by Ren Garcia

Estimated rebates for 2008 provided by the Economic Stimulus Act of 2008 total $ 106.7 billion, distributed on a weekly basis from 28 April through mid-July. Statistics from the US Bureau of Economic Analysis show improvements in Personal Incomes of US Residents.

The 5% savings rate indicate that a significant share of the tax rebates did not all go to consumption –although Personal Consumption Expenditures did go up by 0.8% (current dollars). If the Personal Consumption Expenditures are adjusted (i.e., 2000 dollars), the increase is only 0.4% –so some of the increase can be accounted for by the increase in prices.

Is the Economic Stimulus Act working for you? What did you do with your tax rebate? Spent it? Paid down debt? Saved it?

image from Microsoft Clipart, graphics by Ren Garcia

Estimated rebates for 2008 provided by the Economic Stimulus Act of 2008 total $ 106.7 billion, distributed on a weekly basis from 28 April through mid-July.

Statistics from the US Bureau of Economic Analysis show improvements in Personal Incomes of US Residents:

It looks like, on a national basis, the tax rebates are working. A significant statistic is the Savings figure of 5% of Disposable Personal Income. Despite the increase in oil and foodprices, US residents have managed to maintain a good savings rate.

Is the Economic Stimulus Act working for you?

graphics by Ren Garcia

Estimated rebates for 2008 provided by the Economic Stimulus Act of 2008 total $ 106.7 billion, distributed on a weekly basis from 28 April through mid-July.

The amount of rebate is based on:

2007 tax filings
filing status
level of adjusted gross income
number of qualifying children.

Do you feel the Economic Stimulus Act working for you?

info source: US Bureau of Economic Analysis, image from Microsoft Clipart reconstructed by Ren Garcia