Many of today’s loan mortgage problems facing the consumer have been caused by having a clear understanding of the type of mortgage program they were placed into by their lender. As a consumer we must be responsible for are decisions.  However, most of us unfamiliar with the entire process when acquiring a mortgage loan.  Since purchasing a residence is a major step and will become the cornerstone of the consumer’s assets.  Therefore, it is extremely important that the consumer be aware of all the ins and outs of this process.  

One of the key elements of the consumer’s responsible is to be prepared with all financial information, have a budget and ask questions of your lender.  A good lender will take the time to exam your financial information and explain all the various programs open to them.  Their needs to be good communication between the parties and the consumer must never feel uneasy to ask for an explanation. Remember do not be pushed into something you do not understand.  

So how should a consumer prepared for a meeting with a lender? The consumer should bring the following: 

• Complete copy of last 2 years personal tax returns on all borrowers with W-2’s
• A copy of the borrowers most recent pay stub
• Complete copy of last 2 months bank\brokerage statements
• If a business owner, provide last 2 years of business tax returns
• Have a list of other outstanding debt with balances and monthly payment amount 

By having this information the experienced lender can do a preliminary review of your finances.  In addition, the lender can assist the consumer is preparing the consumer loan application. It is important that the consumer be truthful on this form.  Do not let anyone put information on this form that is not true.  This has been one of the biggest issues within the housing market and is the main reason for some many mortgage failures. Because this application is what the lender uses to determine the type of loan program that will fit the consumers budget and will assist in giving an idea of the consumer’s debt to loan ratio.  The debt to loan ratio is what the consumer will owe and how much cash they will have available monthly.  The ideal ratio is below 47%.  

Whether you are planning to purchase a new residence or want to refinance your current residence the same information above applies.  Before you purchase your new residence, it is always best to discuss your financial present with an experienced lender.

According to a recent article in the Los Angeles Times, mortgage interest rates are at their lowest levels in five weeks, and not surprisingly more people are seeking home loans.  However, the increases had been driven by the refinance market and not necessarily by new purchases. This is can be seen as a positive sign that the value in homes are increasing slightly instead of homeowners being upside down on their mortgages. 

This is both a positive and a negative for some homeowners.  On the positive side, this means they are able to refinance their homes at a lower rate and take advantage of equity in their homes.  But on the negative side, this assumes that the borrowers who are purchasing new homes still have good credit, can make at least a 20% down payment on residences with value of no more than $417,000. 

Having indicated the above, it should be noted that there are loan programs available to the consumer whether refinancing or purchasing a new residence.  An example of a lower down payment program is the FHA financing.  

FHA loans are guaranteed by the government and offer more flexible guidelines than traditional mortgages.  Some of these features are:  

• Down payment of 3.5%
• Allows for lower credit scores
• Cash out refinance transactions up to 85% of loan to value
• No minimum or maximum income limits  

Two important keys to this type of program:  

• Loan amount available up to the maximum JUMBO FHA limit in your area
• FHA financing is for Everyone and not limited to first time homebuyers  

When considering to refinance or purchase, a new property, the consumer must be prepared to present a complete financial package to their lender.  By having all the financial information available, this will allow your loan expert to find the correct loan program to fit your financial requirements.

The one situation facing consumer’s today is financial hardship.  This hardship has been caused by not only the economic climate of losing their jobs or reduced hours to part-time but also by a medical emergency. During normal economic times, the consumer may have struggled to meet their financial obligations.  This means maybe only making the monthly minimum payments on their credit cards but they were able to meet their monthly mortgage and car payments on time.

On average, the consumer seeks to pay all their obligations on time and which would ensure a good credit rating.  The higher a credit rating of the consumer the more willing the lenders are willing to lend to the consumer.  The credit score range from the three major credit report services are from 350 to 800.  The average score is in the 700 range for most consumers. If your credit score is in the low 600’s or lower then you are consider a sub-prime borrower.  A sub-prime borrower historically will pay a high interest rate on their mortgages and credit cards.

So during these trying economic times, the consumer is not only stressed out because of their job lost but their inability to meet their obligations.  The consumer must decide what is best for them and their family. Because of the emotional toll it is taking on them.

After the consumer, has reviewed the various options such as, debt consolidation, debt consulting, bankruptcy, do nothing or debt settlement.  They will see that a debt settlement option may be their best method to unburden themselves.

As what is debt settlement? Debt settlement is a managed approach used by a third party company.  This company will negotiate on behalf of the consumer to reduce their debt by up to 50% of the outstanding current balance.  Basically, the consumer places a set amount of money each month into a “trust account” until approximately half of what is owe on their lowest credit card balance. It is when the debt settlement company will start to negotiate with the lenders.  The lenders are more willing to take something on the balances than have the consumer file bankruptcy on them.  In a bankruptcy case, depending on the assets of the consumer, normally secured lenders get repaid first then the unsecured lenders.  In most cases, the unsecured lenders receive no money from the consumer.

The consumer wants to do the right thing not only for themselves but their families. A debt settlement program can take from 12 months to 48 months to complete based upon the outstanding credit card balances.  This program may cost the consumer less than their current monthly minimum payments.  It is not a quick fix program but a program that will allow the consumer the ability to repay their debt and repair their credit score.

As a consumer who is unable to meet my monthly minimum credit card payments because maybe I have loss my job or have had my wages reduced or there has been a medical emergency. I need to find a way out of this financial situation.  

My first thoughts were to just do nothing and walk away from my debt.  But that is not the right solution for me or my family. So I started to investigate difference methods and face the fact that I need to ask questions and make the correct decision. 

The most often methods discussed for consumers in trouble are: 

• Consolidation Loan
• Home Equity Loan
• Consumer Consulting Services
• Bankruptcy
• Debt Settlement 

In guess in a prefect world, the first three programs would help me rearrange my financial situation.  Since I would have money or equity in my residence to qualify for a loan or I need assistance in understanding how to better manage my money. 

However, that is not the case.  Bankruptcy should always be the last step when considering how to get out of debt.  As a consumer, I do not want to walk away from my debt but somehow pay them back to the lenders. Bankruptcy needs to be discussed with an attorney, who can explain the legal process and its affect on the consumer.  

Therefore, debt settlement was a more managed approach to resolving my financial situation. Debt settlement established a set timeline and monthly payment amount which I would afford based upon using an estimated negotiated settlement program.  My debt settlement company used a conservative estimated of what the lender might be willing to settle the account for.  The figures used to where based upon my debt of $35,000 spread over seven credit cards that they might be able to settle for 50% of that amount.  This program is not a quick fix or an overnight miracle it time to repay credit card debt.  

The one lesson learned during this financial downturn was to tighten my belt and save for the future.  I should use my credit cards only when I can actually repay each month what I spend on the card.  I have learned my lesson.   

So now as a consumer, struggling with credit card debt over $10,000 now is the time to call your debt settlement expert.

Do you have more than $5000 in debt on more than 3 credit cards?  Understanding how you got into this problem and finding ways to resolve the problem is the first step in giving you – your start to financial freedom.

The credit cards were flexible and easy to use for your everyday expenses.  However, over the course of time your rates and fess started to gradually increase.  Needless to say , due to circumstances beyond your control you find yourself drowning in debt.

I read a quote by Pat Robertson and his advice was this ” The law of compound interest coupled with the law of use will lead to amazing things. Meaning if you save it and compound it – sooner or later you will come out with something better” I happen to agree with his observations and comment.

You first want to consider your options carefully  to dig yourself out of debt.  A debt settlement company  is a variable option.  An experienced debt settlement company has the resources and the ability to negotiate on your behalf.  The consumer needs to faithfully follow the plan that the settlement company has placed into action.  The financial plan may take as little as 12 months or more than 48 months on your outstanding unsecured debt.

It may be tough in the beginning to make those sacrifices but once you follow and complete the debt settlement program you can begin your journey to financial independence and starting letting your money work for you.

Credit card debt is almost a way of life in today’s economical time’s.   It’s so very easy to take out our credit cards and purchase everything from groceries to our utility bills on plastic. Some of the time people can pay these off the next month and they do not carry a balance moving forward . However, for others – this is just a way of life.

Which leads us to the question of what if the unthinkable happens?  I’ve been living paycheck to paycheck and living beyond my means. I’ve been laid off and I have no reserves or back up plans.  Of course this will lead to a degree of worry, anxiety, fear and perhaps to denial of the severity of your financial situation.  You have become obsessed with your money problems of missed payments, bill collectors calling and possible litigation.

Needless to say, it’s common for the consumer to avoid the collection calls which further adds fuel to the fire because the collectors just become more aggressive in their tactics.  You might even experience depression but you need to get back to reality and deal with the situation head on!!!

In visiting Dave Ramsey’s website I came upon this comment….”Laziness is a character flaw.  You need to be willing to work and sacrifice in order to fix the situations that you created with your own irresponsibility.  If you are not willing, then you cannot be helped.”  I agree with this statement 100 percent. 

The consumer needs to toll up his sleeves and get ready to work hard.  You need to rip up the credit cards and start by being honest with yourself and your creditors.  It’s time to get proactive and deal with your situation now. 

Contact a consultant who can answer your questions and put you on a path of financial freedom!

In today’s economic climate, the consumer is asking themselves the following questions:

• Is there are way off this financial treadmill?
• How do I get rid of the emotional baggage I’m carrying because of my debt?
• I’m I ready to face the hard decisions about a solution?

As a consumer, you can’t feel like you’re the only survivor on the lost island.  According to the American Bankers Association, “ delinquencies on consumer debt has hit a record 3.23%.” The percentage of borrowers at least 30 days late have hit its highest level in 35 years. In additional, consumer bankruptcy has increased by 22% from 2008 according to the American Bankruptcy Institute.

Consumer are making decisions everyday that they need to get out of debt.  The majority of consumers want to pay their financial obligations in full.  This approach is currently not possible for some consumers.  The reason being the current economic climate along with the new financial hardship faced by consumer.

Consumers when faced this issue are reviewing their options.  One of the options is debt settlement.  Most consumer favor this program over bankruptcy.  Bankruptcy should always be the last resort for the consumer.  Plus if the consumer decides on this path they need the advice of any attorney.

When you discuss, debt settlement as an option.  You will be told it will affect your credit score. This credit score is important to the consumer because its affects your ability to borrow money. David Leuthold, of The Association of Settlement Companies, indicates that many consumers seeking relief have already seen their scores plummet. “Basically, what they’re deciding by coming on to a debt-settlement program it more important than their credit score.”

The consumers credit score can be repaired over time as the consumer pays off or settles their unsecured credit score debt.

If the consumer decides to use a debt settlement program.  They need to know it’s not a quick fix and that they will need to tighten their belts.  The consumer needs to know that if their financial situation improves then they can opt out of the program and get back on track with meeting their financial obligations.

As a consumer, do you feel like the title of the 1961 Broadway play, “Stop The World – I Want to Get Off.” This is how many consumers are feeling with their mounting debt based upon financial hardship. The consumer is not sure where to turn or how to get off the treadmill which is causing emotional and financial stress to them and their family.

One of the alternatives to this situation is to consider a debt settlement company.  I know the consumer is being bombarded with all forms of communications, television advertising, e-mails and mailers.  The consumer is wondering how these companies know of their financial situation.  Basically, these companies have established credit parameters with the various credit companies and receiving list of names and addresses such as, debt over $10,000 or high balances whether you are current or not on your payments. 

So what should the consumer do about their financial situation? The consumer should ask the debt settlement company the following: 

• What are your proven strategies?
• What is your success rate?
• Are you listed with the Better Business Bureau?
• How long have you been in business?
• Can you provide to me references? 

The consumer should be aware that if they try to negotiate with a lender on their own. The lender in some cases will not talk to the consumer unless they are already 60 to 90 days delinquent.  If you are already delinquent this is going to hurt your credit score and can not be blamed on a debt settlement company. 

One of the key’s in using a debt settlement company is establishing: 

• The consumer has some ability to pay a set amount each month
• That the debt settlement program is sound
• That the consumer is aware of all fees involved in a program
• That a debt settlement is better than a charge off on their credit report
• The consumer needs to be upfront with the debt settlement company about their financial situation
• The consumer needs to stay in involved in the process.
• The consumer needs to document all contact with the settlement company and have a clear understanding of the program. A good company will take the time to explain all phrases of the program.   

The consumer needs to remember it is their responsible. There is no quick fix for solving the consumer’s debt issues.  However, there is a way out of this situation.  Contact our debt settlement expert today to discuss your options and get started on your pre-approval.

There are several questions a consumer must ask themselves when faced with overwhelming unsecured credit card debt. One of these questions is “why use a debt settlement company?”  Or why not negotiate myself? Or why not seek out other methods? Or why not file bankruptcy.

The answer to the first two questions are a debt settlement company has the means and the experience to negotiate with your lender on your behalf to reduce your outstanding unsecured balances.  If you contact the lender yourself, they may be not be willing to work with you or they will make the terms unacceptable for the consumer to agree to or even meet. The other methods are doing nothing and working with a credit counseling company which pays the bills for you on a monthly basis. They do not reduce your debt nor do they normally get the interest rate lower.  Bankruptcy is a very serious matter which needs to be addressed with an attorney. 

The debt settlement company will establish the dollar amount which needs to be placed in a “trust/escrow” account and will determine how long it will take to reach the first plateau of your goals.  This plateau is normally half of your lowest outstanding credit card balance.  At that point in time, the debt settlement company will start to negotiate on your behalf.  Here is an example:

• Owe $19,000 on 4 credit cards ($3,000,$7,000,1,500, 7.500)
• Currently monthly minimum payments of $2,300
• Divide your debt by 40% for a new outstanding balance of $7,600
• Estimate new monthly payments of $750 (less monthly fees)
• Under new debt settlement plan it will take between 12 to 36 months to payoff

Yes, a debt settlement company does have some drawbacks.  However, your financial situation requires some type of action.  The consumer needs to investigate all the in’s and out’s of a debt settlement program and how it will work for them. 

If the consumer is committed to using a debt settlement program.  Now is the time to call an expert and discuss how they can assist you.  A good debt settlement company will explain the entire process with you and a realize timeline for getting out of debt.

So call today.

Today’s consumer is facing overwhelming unsecured credit card debt. This debt continues to mount each month even if the consumer has started to tighten their financial belt. In some cases, it may be too little too late.

Debt settlement may be an alternative to trying to work your way out of debt yourself. Depending on the amount of you debt, you could reduce your debt in half between 12 and 48 months.  This figure considers the amount of your debt, the number of credit cards and the amount the consumer is willing to put into an “trust/escrow” account each month.  This method does have some drawbacks dealing with credit score, available to borrow and possible taxes on unpaid balances.  Under a debt settlement program the consumer needs to be willing and committed to working themselves out of debt.

A recent article on MSNBC.com,  tells how one family eliminated $106,000 in outstanding debt over a five (5) year period of time. This family used a consumer credit counseling service. The article indicated the counseling service was taking approximately $2,000 from the couple to distribute to their credits.  This dollar amount was about half of the consumer’s monthly take-home pay.  This caused the consumer to take on a second job.

This is an example of paying off the entire balance including interest and all fees. Based upon information provided, this means the couple paid approximately $120,000 over five years. ($2,000 @ month times 60 months = $120,000).  

This method may have been the best solution for this couple.  You want to congratulate this couple on taking on this task and paying off their bills in full. However, if you compare this situation verse debt settlement.  The debt settlement company may have been able to reduce the couple’s debt in half from $106,000 to $60,000 and may have been able to do it in less time. 

Every consumer needs to decide for themselves which is the best approach for them and their family.  However debt settlement should be investigated as an alternative to debt counseling.  Even with debt settlement a consumer should learn to control their spending and annually review their financial situation.  Some of the debt incurred may have been caused by financial hardship, loss of a job or medical emergency.

As a consumer, you need to call us today to discuss how a debt settlement company might work for you and your family.