One of the ways to best capitalize on your savings is the Certificate of Deposit.

With a CD account you are required to lock your money for a certain predetermined amount of time, at a certain predetermined savings rate. The rate is usually higher  here than  in a regular saving accounts and it changes periodically.

CDs usually require a substantial amount to be deposited and not use. Some programs start at $10,000, others, like the jumbo CD rates, requires amounts of $100,000 and more.

The interest earned from those saving accounts can be used by the saver. It can be added to his checking account on the maturity date, or it can be mailed separately in a form of a check. It can also be rolled over into another CD of the customer’s choosing.

Banks and other financial institutions will let the customer know a few weeks before the maturity of the CD that it is about to mature and ask for instructions what to do with the money. The saver can do whatever he or she pleases after the maturity date. He or she can ask the interest to be transferred, ask for the whole sum to be withdrawn or choose another saving account. If the financial institution does not hear from the customer they will roll all the money (principal and interest) to another certificate of deposit with terms similar to the ones that have just matured.

This is not always the best way to maximize the earning potential of your saving. New CD plans are introduced frequently, long term ( up to 5 years) and short term (as little as 3 months). Interest rates are different for each of the plans, usually higher the longer the money will have to stay, unused, in the account.

To maximize the earning potential, experts recommend to use the CD ladder strategy. This way, different sums of money are put in different certificate of deposit plans, long and short term, instead of one sum in one account.

The reason behind this strategy become clear when you think about the penalties for early withdrawal associated with this kind of account. Money matures (opens up) at different times, so there is always cash available when needed. It also enables the saver to take advantage of new, higher yielding interest rates.

All CD accounts come with stiff penalties if the money is withdrawn before the maturity date. The Truth in Saving Regulation Act instructs that the penalties will be clearly stated and the interest rates can and will not change during the life of the plan. Sometimes, when there are drastic changes in the market, it can be beneficial to pay the penalty for early withdrawal and transfer the money to a new, higher interest yielding certificate of deposit.

Saving money in CD accounts is one of the safest saving plans in the market. The money is solid and will always increase in value. If planned correctly it may be one of the best money makers in the market as well.

The loan that people turn to the most when buying their home is a mortgage. Mortgages are secured loans that use the borrower’s property as collateral. Mortgages form the primary component of the housing market aside from home prices. The one key factor of a mortgage that makes it attractive or repulsive to home buyers is the mortgage rates. There is a lot of confusion about what determines mortgages interest rates. A common question is “Who sets mortgage rates?” The question implies that someone arbitrarily decrees mortgage rates, which is not the case at all.

Lenders determine which applicants are approved for a loan and on what terms. The actual interest rate of mortgages is determined by the secondary mortgage market. This is where stocks and bonds collateralized by mortgages (known as mortgage-backed securities) are sold. This market is very large and very liquid, meaning these securities are either already in cash or easily convertible into cash.

The market works like this: say a lender like a bank makes a new mortgage loan to a homeowner. This newly originated mortgage is then sold by the bank to either Fannie Mae (FNMA, the Federal National Mortgage Association) or Freddie Mac (FHLMC, the Federal Home Loan Mortgage Corporation). The bank does this to collect fees from the sale and to secure itself against the risk of default. These two government-sponsored enterprises then package the mortgage into a mortgage-backed security. The MBS, in turn, is sold to investors. Increasing investor demand drives up mortgage rates because lenders now have to take the price of mortgage-backed securities into account when calculating loans.

Are mortgage rates likely to fall? No, in fact they are likely to rise. The Federal Reserve will stop buying mortgage-backed securities on March 31, 2010. That would lead to mortgage rates skyrocketing as the market compensates for the increased risk. Mortgage rates are likely to skyrocket anyway as increasing foreclosures make the banks nervous, irrespective of the price of mortgage-backed securities.

How many times can you refinance your home? The decision to refinance your home should be well thought out and used for productive purposes only. What is productive? Drawing cash from your equity that will be put toward increasing the value of the home, such as repairs and upgrades, or using the refinance cash draw for emergency purposes only. Too often, people see their home equity as an ATM machine and are quick to pull funds for immediate cash that will have to be repaid over the life of the loan. You may refinance as many times as you are able to do so with a surplus of equity, however, the prudent property owner will look ahead at housing market trends, careful to keep their head above water with the equity.

The refinance process may be performed by your lending institution or a loan broker office. Wherever you decide to find services, be sure to shop around for the lowest interest rate and best service charge. The refinancing market is competitive and you will find estimates for service charges running an average of 1 to 2.5 percent of the new loan balance.

The number of times you may refinance is determined by the amount of equity left on the property, and it’s a good idea to leave a large sum of profit on the home for future use to re-fi when the interests rates are favorable. Once the property has been drained of the equity, a refinance application may be declined by the lender or you will have to pay the re-fi charges cash out of pocket into the thousands of dollars. So refinance with confidence when your equity level is high, and show fiscal restraint when the equity level is low. The math is easy: refinancing is for emergency use only when the funds serve your best financial interests.