Low mortgage rates on the way…soon!

30 year mortgage rates are already hovering around 5%.  Traditionally, everyone would jump for joy and immediately run to the bank to refinance or purchase a new home, but that isn’t happening.

Last month the Fed made mention that they were making moves to reduce interest rates to 4.5% and possibly as low as 4%.  This is why most people are sitting on the fence, waiting for lower rates, which would save thousands or tens of thousands over the life of the loan.

Today, the Fed announced that they would begin buying up mortgage backed securities as soon as early January.  This is one step that will help to reduce rates further.  A reduction in mortgage rates is an integral piece to stimulating the economy.  First time home buyers will be able to buy homes, fix them up and improve communities.  Those who choose to refi (who wouldn’t?) can either lower their payments, which keeps money in their pockets for other items or take more money out to invest in businesses or make improvements to their homes.  All of these moves are very positive.

It’s key over the next 90 days to maintain your credit rating (FICO Score) so you are able to take advantage of these low rates.  If you’ve lost your job or you think you’ll have problems making payments, contact a debt relief specialist before your credit is damaged:  (888) 233-3213 or fill out the short form below.

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The recession and identity theft

Even before this recession started, identity theft was in the news.  There’s no faster way to destroy one’s credit than to steal their identity, take out as much money as possible then obviously never pay it back.

Identity theft has been around for a long time but has gotten worse in recent months as economic turmoil takes it’s toll on people and their good sense in decision making.  Some formerly “honest” people are willing to do things that are less than honest up to and including identity theft.  This could be as simple as using someone else’s credit card you just found (opportunistic) to planning the theft of an identity.

Most identity thieves are intelligent enough to gain access to your credit file without you knowing.  This could be through digital means or theft personal items like a wallet or purse.  It’s the digital ones that can really have an impact.  Just a few years ago, a large national retailer had thousands of its customers credit cards compromised when a hacker came in and accessed their databases.  This was a big operation by people who knew what they were doing.

This all may seem very scary but there is an easy and extremely effective solution.  The three credit monitoring services; Equifax, Experian and TransUnion have systems in place that can help prevent identity theft.  The best idea we’ve seen thus far is to put a freeze on your credit, which you can do for up to 90 days.  At the end of the 90 day period, you can renew again.  This freeze prevents anyone (including you) from gaining credit through a credit bureau.  If your identity is stolen and the thief attempts to open a card in your name, it will be declined.

If for some reason you need access to your credit, the agencies all offer the ability to unfreeze your credit temporarily.  There may be some small costs involved in freezing and unfreezing but the benefits far outweigh the risk of identity theft.

Who do I pay if I lose my job?

This is a common question with a not-so-easy answer because every one’s situation is different.

The economy is horrible.  Job losses are mounting, retailers are going under and holiday sales were at their worst level since records have been kept.  The good news is that this won’t last forever.  In fact, we’re probably looking at the beginnings of a recovery in late 2009 and possibly sooner IF mortgage rates can get down to 4-4.5% like the Fed has promised they would.

These super-low rates would get home buyers off the fence while also generating huge waves of refinancing in communities.  This injection of cash will have a big impact on the economy overall, though it won’t solve it on it’s own.

So if you’ve lost your job, you still have bills to pay.  It’s time to prioritize.  Always go for the necessities first like shelter, health insurance and other legal obligations like child support.  Cancel unnecessary bills like cable TV or that third cell phone line you really don’t need.  You’ll be amazed at where you can make cuts.

Next, look at your auto loan (s) if you have one.  If it makes financial sense and you’re not upside down on the car maybe you can get something cheaper.  If you are upside down and can no longer make the payment, contact the bank and let them know of your situation.  Many people got tied up in vehicles they can’t afford so it might be best to let it go.

Unsecured debts typically come last.  The best example is credit cards.  If you have substantial credit card debt i.e. $10,000 or more, contact a debt relief specialist for help.  Interest can be lowered and payments can be reduced before your credit is affected.

Bankruptcy is another option but not necessarily the best one.  We suggest researching all of your options prior to hiring a bankruptcy attorney for $1500+.

Debt Relief (888) 233-3213 OR fill out this form:

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Can I stop repossession if the repo man has already attempted to take car

Auto repossession occurs when payments are missed on an auto or boat loan and the creditor is forced to take the vehicle back.

The time to repossess a vehicle varies by lender and the original risk of the loan.  Some contracts could have very strict clauses where repossession could happen quickly, while others could take a few months.  For the most part, 90 days past due will result in a repossession but check with your lender or your original contract to be sure.

It’s always best to communicate with your lender before repossession becomes an option.  Many large auto financing companies understand difficult economic times and are willing to set up payment plans so long as the loan comes current in a reasonable amount of time.  If you’re completely unable to make the payments, it’s best to surrender the vehicle to the lender or attempt to sell the vehicle on the open market if you owe less than what you can get for it.  It can be embarrassing to have the car repossessed by a company or county sheriff.  It can also be inconvenient to have your vehicle suddenly taken when you least expect it.

If attempts have already been made to repossess your vehicle, your options will be few because paperwork has already been filed with the court.  Lenders will require that you bring the vehicle 100% current plus pay for other fees that could be extremely expensive and possibly not worth keeping the vehicle.  Call the lender and ask what it will take to keep the vehicle.  They may be willing to negotiate as repossession is happening to many people and the secondary market for cars is not good at all.

The only way to stop repossession is to bring the car completely current (plus any fees the bank requires) or to willfully surrender the vehicle.

If other unsecured debts (credit cards) are affecting your ability to pay an auto loan, contact a debt relief specialist for help at (888) 233-3213 or fill out the short form below:

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Does getting laid off affect my credit?

Many people have lost their jobs as result of the declining world economy, some are concerned that being laid off will affect their credit.

The credit monitoring agencies include Equifax, TransUnion and Experian.  These agencies provide a snapshot of a person’s creditworthiness to potential lenders.  This snapshot and FICO score are affected by a number of variables but not directly by a job loss.  However, the ability to gain credit after a job loss will be affected.

Only payments that are 30 days or more past due can be reported to the credit bureaus.  However, public records like foreclosure, auto repossession and bankruptcy will also be reported and can remain on your report for up to 10 years.

Typically, missed child or spousal support payments that are being handled by the state will not allow for 30 days.  Late payments can be reported if the due date is missed even by a couple of days.  In these cases it’s better to pay early and protect your credit.

Your credit score will not be affected by a layoff but your access to credit will.  When applying for a home or auto loan, credit card or other type of financing, the bank will ask for proof of income.  The days of stated income are over so be prepared to show proof.  If you’ve been laid off recently, it’s unlikely that a bank will provide credit to you even with a strong credit score of 650 or higher.

If you do get laid off and are concerned about maintaining your credit score, be sure to pay bills on time.  If you’re struggling to make payments contact a debt relief specialist at (888) 233-3213 or fill out the short form below and a specialist will contact you to help.

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I’m unemployed and can’t pay debts

If you’re unemployed and can’t pay your debts there are things you can do.

1.  Assess your financial situation.  Are you already behind on bills or just currently at risk if you don’t find work?  If you’re at risk of being behind on bills, start to make cuts where possible.  Reduce your expenses as low as possible.  Document cancellation of any services like Cable or other monthly expenses that aren’t necessary.

2.  If you’re already behind on bills, immediately contact your creditors and inform them that you’ve lost your job and are working on a plan.  Give them a specific day to call them back then make sure you stick to that obligation.

3.  Continue to look for work.  We haven’t seen much value in job sites as they’re overwhelmed with applicants. Network with friends, family and former co-workers.  You’re more likely to find work this way even though it may not be in the industry you prefer.  Cash flow is critical for business and family so do what you have to do.

4.  Don’t ignore collection calls or letters, this will only make matters worse and could force an unnecessary lawsuit.  Always respond!

5.  Cash is in nowadays so liquidate things you don’t need.  Ebay and Craigslist are good options for selling used items.

6.  Avoid bankruptcy (if possible).  Bankruptcy and severely damage your credit for up to 10 years but for some it may be the only option.

7.  Consolidate your debts.  This practice keeps your credit intact, stops collections activities and achieves the pay-down of your debts over a period of time.

For more information on debt consolidation call (888) 233-3213 or fill out the short form below and a debt relief specialists will contact you.

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How much lower will home prices go?

New home purchases AND sales of existing homes fell sharply in November by more than what was expected.  The national median home price also fell by it’s largest margin since the Great Depression and now is at about 2004 levels.

So the question many people have is when will housing prices stabilize and how low will they go?

Interest rates for 30 year mortgages will likely reach 4-4.5% soon and hopefully for buyers who have less than pristine credit (meaning something under 800 and we’re not kidding).  This is how picky lenders have gotten in recent months.  What good is an interest rate of 4% if you have a FICO of 700 and can’t get it? These rates need to be available to the average person.  When they are, expect a big jump to the economy.

But even with this stimulus and other money the Fed is spreading around, it will take an improvement in jobs to really make a turnaround sustainable.  Simply said, if people aren’t working, they can’t buy homes.  When homes sit on the market for months (or years), prices will continue to drop so the only real way to get prices to stabilize is to create new jobs.  We don’t see job creation until the latter part of 2009.  This is because it takes time to implement these packages then allow them to work their way through the marketplace.

Housing prices should bottom around mid-2009.  However, that bottom should stay for quite some time. Don’t count on prices jumping up like they did in 2006, it’s not going to happen, likely at all, in our lifetime (inflation adjusted).  There should not be a rush to buy a home thinking the value will jump from 300k to 600k in a few years.  It could take years just to get homes currently on the market to clear.

If you’ve been waiting on the sideline for low prices and low interest rates, keep waiting.  Most analysts believe prices have a ways to go as do interest rates.  Be sure to protect your credit and pay down debt.  If you’ve lost a job and are at risk of missing payments on unsecured debt, contact a debt relief specialist for help at (888) 233-3213 or fill out the short form below:

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Retailers offer around the clock sales

If you’re the type of person who waits until the last minute to purchase holiday gifts, this is the year for you. Holiday retail sales are down significantly, placing many retailers in serious trouble of going out of business. In fact, there’s a list floating around the web of large retail outlets that are on their way out within the first few months of 2009.  We recommend searching for that list and steering clear of purchasing any gift cards from those stores, as they will be worthless.  For obvious reasons, we’re not going to post it here.

With retailers taking a huge hit this holiday season, many have decided to remain open for 24 hours in an attempt to grab every last available dollar from a consumer.  This year, the consumer is truly empowered to get a great deal.  If you go late (2:00 am), don’t plan on many people being there.  It’s your prime opportunity to get the deal of a lifetime.  We’ve already heard stories of people getting huge discounts just because they were the only ones there.

These opportunities will be available at retailers large and small, from clothing to electronics.  The key is to ignore the sticker price.  When you get to the cashier, ask for a better price or a bigger discount.  Chances are they’ll give you the discount.  

Retailers are in a tough spot now because they need to eliminate inventory in preparation for what’s coming in next month (Spring items).

And if you thought Black Friday (the day after Thanksgiving) was big, just wait until after Christmas. Retailers basically have one week to “make it happen” for their bottom line.  This will be the week between Christmas and New Years.  All forecasts point to a dismal retail year for 2009 so this is their last chance, take advantage of it!

Bailing out Amex and the Casino industry?

Were you upset about the auto industry bailout?  Many people are as the government dished out $17billion to save General Motors and Chrysler, who may ultimately merge but that is yet to be seen and both deny it is happening.

If the auto bailout did upset you, how about bailing out Amex and the casino industry?  We’ll start with the casino industry who poses the argument that they employ more people than the auto industry.  They also feel that the crisis started in Vegas so it needs to end there.  A slow economy hurts many businesses but we never would have guessed that the casino industry would come begging for tax payer money.

Today Amex was given about $3.5billion as part of the TARP money, an absolute baffling move given how the credit card industry contributed to the meltdown we’re in today.  Easy credit for anyone who would sign on the line helped liquidity for consumers but it also gave credit to those who probably shouldn’t have had it in the first place.  Now those people are defaulting on their cards and pushing huge losses on the credit card companies.

In an effort to counter these losses, card companies decided to raise interest rates on current balances, cancel lines altogether and decrease lines with very little notice.  All of these moves directly affected consumers, the ones actually paying their bills.  Now Amex is using taxpayer money to bail out their company?  This seems like double dipping to us.  If you’re going to use taxpayer money to save your company, you should make some positive moves for the consumer, not raise their rates or reduce credit lines with little notice (which affects your credit score by the way).

If your credit card companies have stuck you with increased fees and interest rates that you are now unable to pay, contact a debt relief specialist for help:  call (888) 233-3213 or fill out the short form below.

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When will the economy improve > Dated: December 22, 2008

There is no more common or serious question than when will the economy improve.  We hear it every day and we’ve answered it enough times to have generated a very strong opinion.

Improvement is all relative but if we define it as when jobs start being created it will help the scope of the question.  After reading hundreds of articles, researching data and trends, and talking to people in the field (consumers and business owners), we feel the economy will start to improve later in 2009.  This doesn’t mean we won’t see areas of improvement before that time but it does mean we don’t believe job creation will turn the corner until that time.

Jobs are still being lost so the first thing that needs to happen is to stabilize these losses.   The stimulus packages currently being created seem to be a move in the right direction but it takes time for these packages to work their way through markets.

For example, billions of dollars have been provided to banks from the Fed.  These banks are supposed to be lending out this money to consumers and businesses, which would help to stimulate the economy.  We haven’t really seen banks open up to this yet but it should happen early in 2009.  

IF the talk of 4-4.5% 30 year mortgage rates become a reality, THAT would be the biggest, fastest and best move for our economy.  It would help good-paying mortgage holders to refinance, opening up cash for investment.  It also helps first time buyers to jump into the market, fix up homes and bring tax dollars back to communities that currently are at risk of bankruptcy.  Keep an eye on the potential for these rates, as we feel it will be the strongest determining factor in improving the economy.

Anything that is going to help the economy will be driving by access to credit, whether it be through a new home loan, a small business loan or a credit card.  This is why we’ve written numerous times about the importance of maintaining a good credit rating.  If your credit is good, keep it that way by monitoring it and taking all the prevention necessary to defend against identity theft.

If you’re currently at risk of missing payments on unsecured debt, take care of it now by contacting your creditors and working out a plan.  If you aren’t comfortable doing it on your own, contact a debt relief specialist for help:  (888) 233-3213 or fill out the short form below:

1. Your Name(required)
2. Email(valid email required)
3. Telephone(required)
4. State
5. Debt or Mortgage Amount(required)

 

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