financial crisis
Options For Homeowners Facing Foreclosure
Surely by now everyone has heard of the latest government programs addressing the sub-prime mortgage crisis; they may even realize that there are loan modification companies out there to aid in restructuring the terms of their mortgage. What most consumers do not know is exactly how the process works and what to expect during the process.
One thing that homeowners need to realize is that expecting their mortgage servicer to be on their side and patiently walk them through each step to freedom from foreclosure is a naïve, and even dangerous, supposition.
The Mortgage Crisis Spin
The U.S. government has put quite a spin on their efforts to resolve the current crisis regarding sub-prime mortgages. Television networks and news reports have jumped on the bandwagon, urging consumers to call their mortgage company and keep their home. They are all proponents of do-it-yourself loan restructuring, advertising the process as quick, easy and fail-safe.
What they are not being completely honest about is that a mortgage loan is a legal document. As such, the homeowners who signed it are legally bound and obligated to pay it back under the terms it was written. Attempting to restructure the loan without professional advice and the correct legal information can actually result in creating a worse situation for the struggling homeowner – and oftentimes the loss of the property anyway.
Do Your Homework and Get Help
The good news is that there is a lot of help for homeowners available and loan modification companies to help them. The first step in the process of negotiating new terms for a mortgage begins with research and preparation. Do your homework.
If you are currently delinquent in your loan payments, start by determining if this has resulted in extra and undue fees being added to the amount due. Usually these fees, which can range in the tens of thousands of dollars, will be added without your knowledge. You must know exactly what you are dealing with in order to turn around the situation.
The next thing you must research is the exact wording of your mortgage document and the black-and-white terms. There are some mortgage servicers who will attempt to stretch the definition of terms and take advantage of homeowners who do not understand the legal jargon. As well, the loan itself is probably not held by the financial institution you originally dealt with; it has probably been sold time and time again – an important consideration.
Threats to Do It Yourself Modifications
If you are considering going through the process of the mortgage modification process without benefit of legal counsel, be aware of some of the drawbacks.
Number one is that many times the mortgage servicer will add a release of liability clause to the new terms. This means that the homeowner is signing away the right to ever take legal action against the loan company, no matter the circumstances.
Unfortunately, the mortgage company truly does not care about the plight of the homeowner. They are looking out for themselves. The fact is, many of the consumers who go through a restructure of their loan end up in foreclosure within six months after the new mortgage has gone into effect.
Using loan modification companies as your advocate to prevent foreclosure is highly recommended. These firms have the knowledge and resources to investigate what company truly holds the mortgage and how to best deal with them and respond appropriately to the legal ramifications. If you are facing foreclosure, this is no time to try to do it yourself and risk losing even more.
Financial Resolutions
Are you ready to start a new year with a new outlook on money? Don’t let this be a resolution that wears off by January 31. If you resolve to change your spending habits and stick to it, you’ll have a brighter future.
Have you got the recession blues or even just the recession fears? There’s never been a more important time to be careful with your money. The state of the economy doesn’t indicate that things are going to get better any time soon and those who live on cash and get out of debt will be in better shape to ride out the financial storm that’s upon us.
How do you get out of debt when your income is down?
It’s important to cut expenses and pay your bills on time as much as possible. Do MORE than the minimum payment and you’ll inch your way towards being debt free. Strive ot save money and for every bit of money you save, use that to your advantage by: stocking up on essentials, putting money away for emergencies and paying down your debt.
Bargain hunting is fun once you get started and you can even get your family in on the challenge to see who can find the family ways to save money. From saving on your hydro bill to your automobile expenses to groceries, you can cut corners here and there that can help you get debt free and have more disposable income!
Taking The Stress Out Of Your Finances At Christmas
Christmas can be a stressful time of year for financial reasons. It can feel like you’re in your very own financial crisis!Not only do you have all your regular bills to pay but you’ve got to come up with extra money for gifts and for social gatherings too.
How do you deal with budgeting at Christmas time?
Besides the typical advice of drawing names, doing pot luck meals to save on groceries and making homemade gifts, here are some tips for you to get ready for next Christmas. You’re arleady in the thick of it for this year if you’re reading this post at the time of publishing so do what you can to get through it but plan ahead for next year.
Start Planning For Christmas In January
In January, hit the sales on stuff for next year. This includes gift wrap and bows but it can also include stocking stuffers and gifts for next year. Throughout the year as things go on sale you can pick them up and put them away. This will not only save you money but it’ll save you time too.
Open a Christmas account in January and put money away all year. If you decide you’re going to spend $1200 on Christmas, put $100 in the Christmas account each month. This way, you’re not stressing, spending everything you earn and putting Christmas on credit come November / December. This Christmas money can encompass your gift list, your groceries and your decorations and other related expenses so that your regular earnings around the Christmas season aren’t impacted. If you are someone who receives a Christmas bonus from work, don’t factor that amount into your budgeting and that’ll give you some extra wiggle room during the holidays if an unexpected expense or unexpected gift comes up.
Another wise idea is to save your change in a jar for the year and towards the holiday season either roll it up to use for your Christmas grocery treats or put it in one of those Coinstar machines that allows you to use it for a grocery store gift certificate.
Little things done throughout the year can definitely make the season more enjoyable and less of a financial burden. Merry Christmas!