My friend Roji's husband had a stroke. Fortunately he had purchase a mortgage insurance for life and disability from his bank at the time of home mortgage. Unfortunately he didn't go through the medical and other underwriting process. The bank turned down his application for insurance payment for mortgage. When pressed by a lawsuit, the bank urged that at the time of purchase of mortgage insurance Roji's husband had signed a medical disclaimer that amongst other things stated he didnot have blood pressure, vomiting, loose motions, headache and other common aliment ( that way it is written in the form even to me it looked like it says in the last 5 yrs, but that's for something else). Whereas according to MIB database, the medical record of Roji's husband showed he has blood pressure. Roji's husband countered that the doctor never revealed to him what they wrote in his case history and any way, that happened many year ago before his stroke. The bank refused saying that these common aliments are signs of bigger problems. The court sided with the bank. And now the Roji's are in a fix. They are thinking of selling the home. He can not work, she found work in a factory. Had they taken a mortgage insurance from an insurance company, they would have submitted to a medical test and got a insurance policy. Once underwritten it is difficult to contest the claim. Consider this, 35% of claims in bank insurance are never paid against 3% in case of life insurance. And they both cost the same. However in mortgage life insurance you can opt to recover your cost back, get back all you paid and still have the coverage on. Most people like the Roji's, have no way of knowing this.

Housing Market: Stable in most area, still burning hot for resale homes. Certainly not to the time for \"buy fix and flip\" though you might get a good distress sale. Recently I saw one buyer pick up a detach for $45,000 below its listing price from a bank (those interested in such bargain deals can visit my web site to subscribe to my weekly distress sale newsletter; www. ONhomemart.com ). Though new homes sales seems to be suffering. Recently I am seeing plenty of people who invested on new homes in 2006 are regretting it now. They are on the market for longer periods now and have to frequently reduce price. Gone are days of 2004 2005 new home sale market. Older homes in crumbling neighbourhood seem to getting hard to sell on account of younger resale homes coming to market. In California prices have come down by 26%. Whoops! That means a home worth $ 400,000 is now only $300,000 qtr of its value lost. (White House empathises with common peoples problems and has decided to compensate home owners for such loss by providing them with a one time $600 cheque, dumb a** idea.... audacity of hope....no wonder!)

Mortgage: Privately I think conditions are right to get a HELOC, provided a) that you have frugal habits b) you have at least 20% equity on your home c0 you know how to weld it

Financials, What would I buy now: The financial sector seems near its rock bottom point. Never have the prices of bank stocks been so low. Nor am we likely to see them this low again. I would first buy Canadian banks like BMO, CIBC or Manual Life. I will still not touch anything US. I am also nervous about Emerging Market on account of China (most industries are owned by People's Liberation Army as a result independent audits are worried that these companies are many times over overvalued) and some extent India (slower GDP due to 10% capital deficit due FDI's USD weakness) on the short run, but on the long run I am invested in them. I am bullish about Karachi. In fact this is the time to pick up little of alternate funds like Sprotts. They are going cheap and are open to public. But do not go more than 10% of your saving or RRSP/RESP. The entry time is right for such a purchase. I would say it is time to get out of precious metal short term profit taking. Energy and Resources fund are good long term bets.

WL/UL Insurance: Another wealth accumulator strategy is to buy a whole life /UL insurance. Nobody can guarantee you that kind of returns like insurance can. Imagine you can purchase $ 1 million coverage for $7300 a year. After 20 yrs you can take loan against the face value. What did you pay in 20 yrs= $146,000. If after 20 yrs say you withdraw $150,000 tax free you family still gets $1 million TAX FREE. You can also take use $1 million as a collateral to take a secured loan against it. Whole life insurance is very popular in US. It is called a wealth creation scheme. That's how most of the poorer and middle class folks ensure their beneficiaries do not have to worry about money again. Imagine you died yesterday and within 5 days your loved one got a big cheque, won't that ease their pain to some extent? Won't they think you took care of them even when you are not there?

This is a private newsletter, the views expressed here solely of the author, check website for full disclosure.

Check this eye opener video report from CBC.

http://www.cbc.ca/marketplace/in_denial/