hour with more news. we're going to hand it over the gerri willis and "your bottom line." >> this is "your bottom line," the show that saves you money. we'll look at the xhupts hit hardest by the foreclosure epidemic and those rated the best places to live. a new study shows african-americans and hispanics are less prepared for retirement than white and asian counter parts. and the minimum wage goes up this week. that means more money in the pockets of americans. "your bottom line" starts now. we begin with the mid-year u.s. foreclosure report out. foreclosure filings are up in the first half of 2009 from the previous six months to a total of 1.9 million. to break it down for you, it's roughly one in every 84 american

homes. that translates into a 9% increase in foreclosure filings and 15% increase from the beginning of 2008. here to help us break down the numbers and what it means for the housing market is rick. he's the senior vice president of realty trac. welcome to both of you. >> thank you very much. >> rick, i want to start with you with the foreclosure numbers. i was expecting, maybe, maybe, we might get an improvement. not yetd. the numbers are worse. why is that? >> an industrywide moritorium, a state of activity on the loan modification front. we can't stem the height of foreclosures. it's beyond what anybody expected. >> i look at mortgage rates all the time. i'm obsessed.

they are 5.4%. with rates that low, you would think people are running to get new mortgages, refinancing. i still hear there's trouble. what does it take to get a new mortgage? >> there's an influx of buyers refinancing their homes. the key is qualifying. those who are upsidedown -- >> meaning they owe? >> they owe more than their house is worth or they can't show enough income. the people that are benefiting are showing tax returns, have a 700 credit score. >> it's a high hurdle for a lot of people. who are the buyers in the marketplace. i recently read vegas has the highest number of sales ever in the previous month. what is buying? >> what bob said is correct. you have first time home buyers qualifying for fha loans and investors.

they are using nontraditional financing, cash or private lending. those comprise 80% of the buyers market now. >> private lenders, wow. a lot of regular americans are hard pressed to define what a private banker is. what is the right kind of institution to go to? the small bank, the big bank, the credit union? >> the o bbama administration p $50 million out to help people that are upsidedown. it's not trickling down to the street level. when it comes down to the street level, things should loosen up. each lender has different criteria. one lender that might allow 60% of your income to go toward housing, another might allow 30% or 40%. work with a qualified home officers. >> real quickly, we don't have a

lot of time left. i want to know, if you're out there and think you might want to buy a foreclosure, get in the marketplace, what do you need to know now? >> you need to know what you are qualified to get in terms of a loan. fannie and fha will let you build repair costs into your mortgage. understand the repair costs that are involved in buying a house. get an inspection of the property. try to figure out what the discount needs to be to make it more of a bargain. a foreclosure might be selling for 30% or 40% less than lars time, it doesn't mean it's a bargain if the rest of the homes fell that much. know what it's going to cost to fix it up. know what you are qualified to spend. >> know what you are qualified to spend. bob what is the proportion of the budget you should be

spending? >> three times income. if you are making $50,000 a year, look at a mortgage of $150,000. >> thanks. >> my pleasure. detroit is all that's wrong with the rust belt of america. nearly one in six people out there out of a job. is their gold buried under the rest? we have more on how some folks are making a bet on a motor city renaissance. >> reporter: this house in northwest detroit sold for $7500. you may have missed the investment opportunity of a lifetime. >> we have a waiting list of people to rent and buy. >>reporter: this man thinks he didn't. he purchased 250 homes in detroit betting the motor city

will rise, again. >> when we find a nice street, we buy all the available inventory on the street. >> why is this a good place to put your money to work? >> it's a gd question. i get asked it a lot. we are buying homes in that range and we are able to offer them at better prices. since everyone is going to need a place to live, we are offering value. >> his company invested between $10,000 and $20,000 a home. they have been able to flip it for a 30% -- it's far from a safe bet. home values are down 45% from their peek in 2005. >> this house, since we acquired it has been broken into. i didn't know that until a minute ago when we walked in the kitchen. >> really. >> someone has kicked in the door.

>> reporter: you have seen a home that's foreclosured and in shambles and in the process of getting fixed up. here is the finished project. for this to work out, you have to get someone to rent or buy this home. the man in charge of doing that is eric. he's a property manager. >> of the 70 homes we have 64 of those homes filled with families. >> my partner and i have been investing in real estate for 30 years. we are at a point where we want to give back as well. we saw an opportunity to make money and give back to the community. >> reporter: there are some parts where he's not willing to make the same bet. >> there's a lot of properties available in the inner city that can be bought for little or next to nothing. if i invest in $15,000 or $20,000 in a renovation, even

though i bought it cheap, if people are afraid to live there, my house is staying empty. >> for more up to the minute news about "your bottom line," log on to ccnnmoney.com. why some americans may be falling behind and how to get back on track. ask your doctor if a cialis option is right for you because in addition to 36-hour cialis, there's another dosing option: cialis for daily use, a low-dose tablet you take every day so you can be ready anytime the moment is right. man: tell your doctor about your medical condition and all medications and ask if you're healthy enough for sexual activity. don't take cialis if you take nitrates for chest pain, as this may cause an unsafe drop in blood pressure. don't drink alcohol in excess with cialis. side effects may include headache, upset stomach, delayed back ache or muscle ache. to avoid long term injury, seek immediate medical help for an erection lasting more than 4 hours.

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good news about 4.5 million u.s. workers will see bigger paychecks. july 24, minimum wage will rise to $7.25 an hour. this is the third and final step in an increase. retail workers will benefit most. higher wages produce higher

turnovers. with unemployment at 9.5% some are wondering if the hike is enough. a new study shows african-americans and hispanics are less prepared for retirement than white and asian counter parts. why is that? barb has advice for us. also joining us is ryan mack, the president of optimum capital management. welcome to you both. >> thank you. >> thanks. >> i want to show the numbers from your study, barbara, which i think are interesting. 77% of white workers, 76% of asian workers and a big gap, a big jump 66% african-american works and hispanic 65%. what is going on here? >> well, i think there's a lot

of things that could be impacting that. it was a study of over 3 million workers. it was designed to look at the differences by race ethnicity. there can be a lot of factors going into it. when we adjust it for age, service or pay, we saw disparities by race and ethnicity. >> when you look at reasons why it might be right, i think a lot of people might say it's financial education. is that enough of an answer here? >> you can't remiss by looking at class and socioeconomic communities. black communities poverty is 32%. you might have less potential to be able to invest. >> african-americans are putting money and food on the table, a roof over your head instead of 401(k)s. asians and whites leading the pack.

african-americans and hispanics are behind. what's interesting is a lot of companies are doing automatic 401(k) enrollment. why is there such a disparity here? >> this is the next part of the equation. the first step is do they get in the plan. that's the participation rate. once they are in, what rate are we seeing. after we adjusted for things like pay, age and service. so, the why behind it could be influenced by a lot of factors such as their situation outside of the home or how much total household income they may have or attributed to their comfort level with saving in a 401(k). >> racial minorities are set up to be not stable in retirement, to have issues, problems paying for their households? >> it's dif nitly a lot of issues. we need to be more diligent and pay for our own retirements.

we are celebrating the 55th anniversary when the civil rights act started. precivil rights era, there are a lot of things we were not given access to. you have first generation investors. second level, we have 90% consumption rate between black and hispanic -- >> of income. 90% of income. >> we are using debt to purchase things we don't need and impress people we don't like. we have to be sure we are being more diligent and start saving toward the future. >> we all need to be more diligent, i think. barb, you have another interesting finding. it's to invest in stocks and at what rate. tell us your findings and what they tell you. >> right. when it came to how much people invested in equities among the

african-american community, less money was going into stocks overall. we saw this consistently across age. you look at age and can argue people at younger ages should invest in stocks. >> i think it's fascinating. ryan, i have to ask you, the madoff headlines, what's gone on in the financial markets, is it possible racial minorities don't trust the system enough to invest? >> that's a huge part of it. my grandmother didn't trust the banks and didn't go to the banks. in addition to that, in terms of exposure, one of my aunts called me and said what is stock. it's not a discussion around african-american and hispanic dinner tables. we need to up that.

you can bequooef knowledge. if you are teaching your children and having those conversations you can increase the likelihood of increasing stock. >> thank you both so much for being with us today. >> thank you. this week, cnn continues its investigation of the most challenging herb shoes with "black in america 2." follow the topics at cnn/black america. it's only on cnn. from low unemployment to from low unemployment to great school systems to below average crimes money magazine's best places to live. we'll tell you where they are next. head & shoulders is just for dandruff. myth. the fact is, head & shoulders does more than ordinary shampoos and conditioners. it gives you... seven scalp and hair benefits including relieving dryness, itch and irritation.

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time for "money" magazine's list of the best places to live. did your town make the list? let's find out. donna is here to give us their picks. your magazine has been doing this for 25 years. you're really expert at picking the towns that have great job, great places to live. lots of opportunities for families. at the top of your list is a little town called lewisville, right? lewisville, colorado.

>> right. lewisville, colorado is between denver and boulder. it's in the rocky mountains. >> beautiful. >> what do you think? outdoors. there's hiking, skiing, biking. you know, you name it, but it's got more than great stuff to do outside. there are a wealth of industries that have helped it really weather the recession. its unemployment for the county is the lowest in the state and it's got jobs in energy, health care as well as education and, of course, high tech. >> let's go over to minnesota now, to chanhasan another tiny town. not very big but you say wonderful. why? >> 25 miles west of minneapolis. a great little town. it was in a recession, you'd never know. bond rating upgraded twice within the past year. it's got home prices that have gone up slightly in the past year and -- >> people love that. >> brand new high school, opening this fall. a lovely little town that's got 11 lake, 34 parks.

every house is within half a mile of a park. >> wow. that is truly impressive. to a suburb of omaha. >> this is pa pellian, nebraska, two minutes from omaha and it's got also amazing combination of a strong local economy. lots of jobs and very affordable homes. the unemployment rate is 4.4%, less than half of the national unemployment rate. >> what are the jobs there? >> extremely versatile. insures, conagra is headquartered there. transportation, agriculture. there's military air force base there. a lot of defense contractors. >> all right. milton mass, massachusetts found right outside of boston. >> only 11 miles from downtown boston. people we interviewed there said it feels like a little slice of vermont. classic new england town. it's got a very beautiful, like sort of a quiet country feel to

it. historic homes and relatively low unemployment an lots to do. >> now we get to my favorite. peachtree city, georgia, where people get around by golf carts. >> right. five villages connected by roads but also 90 miles of golf cart paths. people take -- ride the golf carts to school. see them right here. it's really a great way to get around and, boy, talk tab keeping low stress as well. >> thank you so much for your help today. appreciate it. the cost of organic foods can really add up. how do you know which products of worth it? we'll help stretch your dollar and still keep your family healthy.

you have questions. who can give you the financial advice you need? where will you find the stability and resources to keep you ahead of this rapidly evolving world? these are tough questions. that's why we brought together two of the most powerful names in the industry. introducing morgan stanley smith barney. here to rethink wealth management. here to answer... your questions. morgan stanley smith barney. a new wealth management firm with over 130 years of experience. vo: yowalmart checks other for sstores' pricesoney. and they'll match any advertised price. so instead of searching for "deals" out there... you get everyday low prices, right here. vo: ave money. live better. walmart.

turning to cut back, one organic food company is doing the opposite and system giving back to the community. cnn stephanie elam tack a ride up to applegate farms, where they've got a simple mission to change the way you and your kids eat. >> this is a picture of me, of my famed attempt to become a vegetarian. >> reporter: how long did that last? >> about an hour. >> reporter: stephen likes meat but doesn't like how most of it gets on the table. so in 197 he started applegate

farms. what's wrong with the way people eat meat now? >> a lot of the meat in america is produced cheaply and unsustainably and inhumanely. >> reporter: applegate believes in transparency. >> what we get to do in our structure is actually track every single animal from every farm all the way through to the finished product. >> reporter: but sustainable food production isn't cheap. >> probably 20% or 30% more to do it in a sustainable way. >> reporter: applegate sources its products from about 300 small farms that cultivate their animals organically. >> our farms can work for us 100% of the time, and we feel like we're creating lots of jobs that really have gn away for the last 20 years. >> reporter: while sales have suchered some this year, applegate still expects to post double digit growth with sales just shy of $100 million. and the company is hiring. >> we've increased our benefits

package in the last year and now are starting to hire more professional managers. kind of to help sort out how to run a larger bit. >> reporter: it's not just their meat that's different. so is applegate's office. from the massive kitchens that replace the lobby to the meditation room, stephen believes in working outside the box. >> this is how most decisions through the history of mankind were made, sitting on the floor. not up at a desk or a chair. >> reporter: once mission applegate is committed to is teaching the kids of valued healthy eating by adopts seven kindergarten classrooms like this one and taking them to area farms to enter a basic question. where does food come from? >> apples come from -- >> trees. >> trees grow in the -- >> woods. >> reporter: this connects kids to the source of foods. how is it grown? where is it grown? what makes it healthy? and to us, healthy food is real food. >> reporter: it's applegate's simple recipe for good business, better products and happy customers.

stephanie elam, cnn, bridgewater, new jersey. knowing which products to buy organic sometimes isn't easy. here's what you need to know before you head to the store. first, buying organic meat, dairy and poultry products, can reduce your risk of exposure to toxins for both you and your kids, and if you have a little one organic baby foods are a good way to avoid pesticides commonly used on produce. fruits and vegetable, apple, peaches, spinach, expect to pay about 50% more on average. buying the produce in the season can help reduce costs as well. don't forget to surf around the web for coupons. many organic brands offer coupons right on their website. when it comes to cleaning products, when you see the term all natural, make sure the first ingredient isn't just simply water. as always, thank you for spending part of your saturday with us. "your bottom line" will be back next week right here on cnn. you can also catch us on "hln" every saturday and sunday at 3:30 p.m. eastern time and hear much more about the impact of this