Re: Bankruptcy, filing vs not. savings, with filing vs not

I would try to sweat it out a bit longer. IIRC, ‘unsecured’ means they cannot take your home. They may take you to court and try to sue you, and if they win, most of the time courts will NOT boot the kids or you out. The victor puts a lien on the house and thy collect when you die or re-finance.

Have you spoken with the mortgage lender to see about changing to a FIXED loan? Even with a $7000-9000.00 addition on that debt, over time, it may work out a bit cheaper and more predictable in the long haul.

I think we have decided to wait another month, so I am paying my mortgage again this month. Trying to weigh what is best for us. God, I am scared of being homeless! Been there once, don’t think I can do it again. (Not due to poverty, due to a new job and relocatinig to a very difficult area to find rentals with kids and pets, I even lost a baby during that move, so I am really freaked out about it.)

I guess the president finally signed some papers that might help us. He signed to freeze interest rates that will go up in 2008 and 2009. Not sure why he didn’t do 2007. Stupid I guess. I have to do some research and see if this will help us and if we qualify, then its back to reevaluating.

Hi there, yes, I did speak with them they are in so much trouble they have stopped making any loans or refinancing al together. They are Option One. One of the worst predatorial loan lenders out there right now. I am going to wait another month, see if we qualify for a modification. thanks so much for your advice.

Try a different lender.

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Bankruptcy, filing vs not. savings, with filing vs not

Hi all interested parties,

We just met with a bankruptcy attorney. this is our scenario.

We owe in unsecured debt about 18,000.00. Low compared to the national average.

However, the thing is…we have an adjustable predatorial mortgage on the house. We just got adjusted to 13 % and in June it can ( and will) go to 16%.

So, on a home that is 100,000.00. We are paying 1,350.00 principal and interest, in June it will be more than that. This is about 45 % of our income. The home MIGHT bring 125.00 , needs repairs.

so, he showed us how by filing we can save 1000.00 per month, for 5 years, with investing at 12-18 % we can buy a home for cash. then after about 10 more years we can retire worth about 1.2 million and not have to worry about social insecurity.

We obviously would have to rent a home, that is the hard part for me, i HAVE BEEN HOMELESS IN THE PAST AND ACTUALLY HAD A STILLBORN BABY DURING THE WHOLE PROCESS, so I am freaking out about finding a place to rent, we have kids, the kids have pets….etc… can’t change schools. I seem to shut down and go into a depression versus getting proactive. so I am scared to death about this. I don’t want to camp again. We got into this trouble from 9-11 and health issues with 2 hip replacements, off work for 18 months no pay…..stupid choices…bad decisions…etc.

What do you all think…??? Is it a no brainer? Should we let the house go too? We are being hounded by creditors and are behind in our mortgage.

I feel for you!! Deep breaths!

My DH and I just recently had to go through a similar thing; in the end we decided instead of feeling sooooo strapped for everything for the next 3-5 years with a chapter 13, that we would let the house go and file chapter 7. Boy oh boy did that decision eliminate ulcers in my life! We had time and we took it, to find a rental that would allow the kids and pets and all the kids summer toys!!!

I am feeling much better about my decision than I originally thought I would! It was difficult, but I like knowing that me and my family will not starve just to keep that particular house! With the economy as it is I got the feeling that most landlords were more apt to accept your family as is instead of asking you to get rid of the pets. People are barely able to afford one mortgage let alone two or more.

Good Luck to you and don’t stress, enjoy the holidays, enjoy your family and by all means do what is right for the entire family!!!

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Debts vs. credit score

Hello! I am fairly new to the blog. I have some lingering debt that is on my credit report that I do want to pay off. Some of the creditors have offered a settlement amount which is far less than what was originally owed. Does anyone know if I should pay the settlement amount or should I pay in full. I understand that the creditors want their money. (I am talking about collection agencies) Will paying these off affect my credit score? I am open for suggestions. I am not sure if I should pay these off in one lump sum or set some goals and pay them down until they are settled and I would like to know how this affects my credit.

My mother paid a settlement amount not the full amount odd and the difference between the two was considered income by the IRS so she ended owing money to the IRS. Just something to think about.

Still, paying off the debts is fine. It can raise your credit score, from my understanding.

  1. Get the total amount to be paid IN WRITING and make sure it clearly states that paying $$_____ amount will SETTLE THE DEBT IN FULL. This is important.
  2. Pay by traceable means (cashier’s check, money order).
  3. Make copies of the letter and the check before you mail.
  4. Send with SIGNATURE REQUIRED (the bright pink labels at the Post Office). If nobody signs for the payment, the postman will not just leave it there.
  6. Once you have paid, tracked that the payment has been received. You can check with your bank to see exactly when the cashier’s check has been paid; plus, you will have the signature card back showing that date that someone at the company signed for the payment to be received. Send a copy of the letter and the check payment to each of the credit bureaus and ask them to update the status as PAID.

So your recommendation is to pay in full, not the settlement amount. I know colletion agencies purchase debt for pennis on the dollar so I am afraid if I pay a settlement amount that the debt will come back to bite me again. If I write a personal check to do so I should be able to pull a copy from my statement as well. (as long as they accept personal checks).

Do not write a personal check, that gives them your account number and next thing you know they have emptied your account. The danger of using a personal check with some sleazy collection agency is that you just gave them access to your account and they could take money directly out of your account. Before everyone bombards me with ‘that’s illegal!’, it has not stopped them before. It always advisable to pay these sleazy people with money orders, etc.

I had a debt collector call me about 2 months ago, and when I refused to send them postdated checks or give them my debit number, he told me that there was nothing we could do to work together and hung up on me! I did not dispute the debt and was willing to pay it, but not on their terms!

Once the debt is sold off to the collection agency, you can negotiate with them for a lower amount that even what they state.

If the original debt is $5,000 and the collection agency bought it for $3,000 and they are asking you for that $3,000; call up and offer them $1,000. They may counter, maybe not. However, since they are just out to get what they can, offer them the $1,000; get it in writing, stating that paying the $1,000 will be PAYMENT IN FULL and then pay that amount.

You don’t have to put up with abuse from these creeps. If the debt is legit, ask for documentation. Do not give any of them post dated checks, debit card numbers or any access to your bank account. Some of them will drain the account and you will have to fight them – not a path you want to go down.

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My rules to buying a house

  1. Always put at least 20% downpayment, otherwise continue to save money.
  2. Always get a fix rate loan unless you are a very savy investor or you definitely know that you will be selling the house before the rate adjusts.
  3. Buy a smaller house then you can afford because it is easier to buy a larger house than it is to sell a large house to move into a smaller one.
  4. Learn some basic home repair skills or save lots of money and prepare to pay lots of money for the eventual repairs.

Anyone have other good rules?

Freedom is not free.

Buy a Reader’s Digest Home Improvement book or one at Home Depot that shows you step by step how to do home improvement projects. It helps a lot!!!!! Well worth the $20 – $30 you will spend on it. Get a good set of hand tools – so you can make minor repairs.

Your local library is also a good souce for home improvements books and they’re free!

Never bad to utilize the library. For this, I suggest investing the money in yourself and your home. If something goes bad in the middle of the night or after the library is closed, being able to get the book at home and take care of the situation rather than waiting helps a lot.

Keep a toolbox stocked with standard household tools too.

Look online at DIY Network for how-to tips as well.

Other rules:

  1. Take a tape measure and measure the rooms. Measure your furniture at home before you go house hunting. Don’t guess. Carry the figures in a notebook so you can know before you “fall in love” that the house will or will not fit your things.
  2. Take a notebook and as soon as you are done visiting the house, make notes about what you liked and did not like.
  3. Take a camera and lots of pictures. You will forget the details 5 houses down the road. Was that the one with the rose bushes in the backyard? Or the deck? Or needed new windows? Or the green kitchen? Or the one with the fireplace I liked or did not like? Etc.
  4. Do not fall in love with the house. It is not yours until the contract is finalized. There is another one right down the street for sale too.
  5. Always get an inspection.
  6. Get a home warranty and renew it yearly. Well worth the cost.
  7. If you buy a house with a fireplace, have the seller hire a chimney sweep BEFORE you buy it and have it serviced.
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Assistance w/one time mortgage payment

I generally have enough to pay my mortgage however, due to an array of things which has happened to my family over the past month, are unable to pay the entire amount this month and don’t want to be late or affect my credit, so, I was wondering if anyone knows of any agencies that could possibly help, irregardless of income.

I dont know of any trustworthy options, be careful as there are so many people just waiting to attempt to scam people out of their money. I would suggest trying a relative.. if that is possible. And, as a last resort you may opt to getting cash advance online from reputable companies – but remember to borrow only as much as you will be able to pay back on time!

It is scary how we find out how important an emergency fund becomes in our lives. I didnt have one either and thought making 50k a year I was doing ok, until Ilost my job.. I am now on track for being completly debt free in 5-7 yrs as it is the only solution that can protect you.

I hope you have success in finding the funds you need, have you tried I have not used them so I cant voche for their services.

A liitle bump in your credit would be the furthest thing from my mind, getting past this is much more important, re-group then eliminate your debts and your credit will sour.

I was in the same boat this month because I am waiting for disability to come through. Check your local churches. They helped me out with my mortgage. Also check to see if you have a community hotline. We have one here and you call them and tell them your need and they can give you places to call to ask for assistance. I also got on the internet and found place that help in my area. Hope this helps!

My apologies if this is off topic but what denomination was the church that helped? I work for a Catholic university and don’t get paid much money. I was stunned when I got a letter from the Chancelor asking ME for donations back to the school. I thought the employer usually gives the Christmas bonus – not the other way around.

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Re2: Good refinance plan

Out of curiousity, what steps did you take after re-financing? did you just take the new lower payment or did you use the savings to apply towards debt payment. I am finding that consolidation and re-financing usually dont fix any issues, it just pushes the burden further down the line. The best of luck to all in there quest for debt freedom. I am on target ofr being debt free in 5-7 years and hope the same for everyone else.

Well, see, that’s the problem. Our expenses and cc payments were much higher than my income. So the lower payment is just getting our expenses in line with what I bring in. We really don’t have any disposeable income. We will still try to save, though.

The steps we took were before we refinanced. I don’t go to Target twice a week — now I’m lucky if I go once a month. We eat out only once a week. We only buy food at the market — no more soda, no more chips, no more processed foods, those add up. We realized that Trader Joe’s is much cheaper than our regular market. I don’t wait to fill up my gas tank when I’m almost at empty and drive into any ol’ station. I make sure I get to the station withe a good price on gas.

Our issue is our spending and that’s what we’ve been working on these past two years. We have two cars that are paid off and we won’t buy another one until we have cash in hand. We just couldn’t get our expenses low enough and the refinance was our last resort.

I think most people are finding the same thing out the hard way and of course the way the credit industrys string people along doesnt help.

I found out after loosing my income how bad a shape I was in, I have since recovered and luckily did not loose anything.. I did some searching and came across a guy by the name of john cummuta. I have since learned why it is that myself and many others cannot eliminate their debts for good.

Since I have started following his methods I am making a huge dent in my debts. Even if you have start small , following his methods will create a huge debt pay off machine. Look on the net for him, his program is called debt to wealth.

Living paycheck to paycheck will hopefully be soon a thing of the past. Somewhat the same situation here. I am aching to think about refinancing with the CC’s included, though the problem I have is similar to yours, with more money going out than coming in.

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Re: Good refinance plan

Here is my 2 cents worth…

Re-financing is dangerous “if” the following happens. If for some reason your income changes and you are stuck with the lower paymnet for the long term then you will probably spend just as much if not more in interest charges over the term.

On the other hand, given the numbers you have shown and the fact that you have an extra $1241.00 a month , then it can make great sense to do so “If” you apply that extra amount to your mortgage payment which will accelerate your mortgage payment and will save you a TON of money . You will then have made it worth while to do so. Instead of paying 92% interest which most loans do in the beginning you will actually be wiping out principal and saving a ton on the interest charges you would normally have paid just paying the reduced amount of $2466.00. This is assuming your goal is to be debt free.

Thank you for your input.

Debt free? Yes, that would indeed be my goal. As it stands now, after looking more carefully into my debt (AFTER my post here) I realize that I actually pay MORE a month between all my bills, than my wife and I actually bring in. AND, this does not even include food and groceries. I realize it’s time to also cut out some “monthly” items that I can probably do without. While the refinance will most definitely help, I realize that my habits need to change, dramatically, for the plan to play out as intended.

I thank you, again, for your response and input.

We are in the same situation and we did recently refinance. It really hurt me to do it, but the rates are low right now and I think they are going to be cut again today. We went from two incomes to one (husband just recently got his family therapy license) and we did not have the income to cover our expenses. We’ve been cutting back for two years, but we finally had to face the facts. In those two years, though, we’ve gained alot of practice in *not* spending or using credit cards. Although we didn’t want to refinance, we realize we could be in a worse situation. It has been a very difficult road to go from consumer to a deliberate spender, but it can be done. Good luck!

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Good refinance plan?

refinance planI’m currently in the position of possibly refinancing my home, and tacking in some credit card debt as well.

While the offer being give sounds all good, I’m not by any means “money-literate”.

So, maybe I’m missing something here. Here’s my situation at the moment.

I have a first mortgage, traditional 30-year fixed, at 6%. I have a second mortgage, interest-only, adjustable rate, currently at 9.5%. Been at 9.5% for the last 3 months.

I also have a credit card debt of $37,965 spread out amongst 4 credit cards. I am exactly 3 years into my current mortgage.

1st mortgage (6%)
$320,234.00 balance

2nd mortgage (9.5%)
$320/month interest only
$39,623.00 balance

Amex CC (9.9%)
$217/current minimum payment
$10,930.00 balance

Chase CC (9.9%)
$118/current minimum payment
$5,690.00 balance

Chase CC (3.99%)
$191/current minimum payment
$9,373.00 balance

Citibank CC (3.99%)
$181/current minimum payment
$11,972.00 balance

With these above, I am currently paying “at least” $3,027 a month, just to keep all my payments in check. Realistically, I only pay the minimums on the credit cards, but I actually pay $1,000 towards the second mortgage instead of just $320, so that I have principal covered as well. So, in reality, actual funds I am paying monthly is $3,707/month.

On a refinance, I was offered 5.8%, for my 1st, 2nd, and CC debt. Fees to be included into the payments, of course. This is the offer I received.

1st mortgage, 2nd mortgage, and all credit card debt, consolidated into the refinance.

$2,466/month, would cover all the above. 30-year fixed. 5.8%. Fees already included into the monthly.

So, I’m currently paying $3,707/month, which covers my 1st and 2nd, and the minimum only on the credit cards. If I do the refinance, it would be $2,466/month, and would also cover the 1st and 2nd, as well as all the credit cards, and in return would leave me with $1,241/month additional cash funds, for reinvesting or otherwise.

The numbers all sound good. Already approved for the above. But, I am mostly questioning if its a good idea to drop the two credit cards in there that are currently at 3.99% each. Would it be better if I just went ahead and consolidated all EXCEPT the one Chase and one Citibank card? Then, with the monthly savings, I could pay off those lower-interest cards much more quicker myself, as opposed to throwing them into the 30-year plan and stretching them out. At the same time, I can keep my new monthly mortgage at a lower rate.

Any suggestions and opinions are greatly appreciated.

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Health Insurance

health insuranceI’ve seen a few messages come through in response to the rather controversial posts made by a former member.

If the messages were not productive to the topic, they were deleted. The former member who started this has been banned (twice actually as they tried to get back in). So justifications are not needed, nor were they ever needed.

Sometimes people will go off topic and attack; I try to keep on those types of posts and delete them. This group is for people to help and be helped; and provide positive reinforcement to each other.

I won’t allow it to degenerate into a mudfest, so I hope you all understand if you don’t see a post you made in reply to the negative remarks from this former member. I didn’t realize their intent prior to their being banned, it only came out after several posts were made.

I value each and every member on this list and their right to make their own mistakes, then get help here as needed to get back on track. 😉

I know each of you want to help and be helped, or you wouldn’t be here, so please, let the negative comments previously made go by the wayside where they belong.

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Need help refinancing

I am in a situation where I have an adjustable rate and I need to refinance before my note increases tremedously. My problem is that i have bad credit and I dont know the first steps to repairing it. Alot of the things on my credit report is old but what is hurting me is that I am a slow pay. I am a single woman on my own and some times I have to rob peter to pay Paul. I am just trying to find some help in this madness, is there anyone out there that can help

It takes time to fix credit but it can be done, I dont believe all these companys that claim they can fix you over night. I would be glad to offer some advice but would need some additional specifics. What does your cuurent budget look like? List all your balances and their minimum payments and lets see what we do to get you on the right track. Maybe if a second pair of eyes or in this case an entire forum looks at they can recomend a way to help get your debt down faster. Look forward to your reply and good luck.

Depending on your location there may be a Foreclosure Prevention Center. These are nonprofit organizations that receive HUD funding for this purpose. They’ll be able to help you perhaps refinance.

i wish i could help our adjustable also goes up and we have good credit but our property will not apraise for enough what to do? Can you go to the lender and apply for a FIXED rate loan? Tell them you don’t like the way adjustable is screwing about.

Certainly, but that is going to open a can of worms.

  1. Are there any pre-paymnet penalties on your current.
  2. They are going to run your credit.
  3. Is you house value going to support a re-finance.

You will probbaly get hit with closing costs.

But if oyu get a good rate in the long run may be worth it, just make sure you come up with a good paymnet structure to pay off everything early and make it worth your while.

Just my thoughts.

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