Now that we are well ensconced in this mortgage financial meltdown...finally the banks and lenders are starting to work with home owners to assist them in staying in their homes.
Loan modification, a process where the homeowner applies to the lender for mortgage relief, has recently become a viable option. This is not something new...but rather the major lending institutions have finally come to the realization that it is in their best interests to work with the mortgagee that is experiencing financial hardships. When a loan goes into foreclosure, the value of the paper immediate drops by a minimum of 50 percent. Couple that with legal fees that can easily exceed $20,000, it is easy to understand that loan modification is not only a viable option for the financially challenged homeowner, but it makes sense from the standpoint that we need to be as proactive as possible, as a community and nation, to do what we can to get under control the tsunami of foreclosures so that we can get this economy back on its feet.
Loan modification will not help everyone. It is not a blanket panacea. There are certain criteria that the distressed homeowner must qualify for, to be an applicant for loan modification. If they do not meet these qualifications, then other options like short sale, foreclosure, or bankruptcy are alternatives.
Homeowners must beware that, unfortunately, there are predators who attempt to take advantage of the homeowner and ultimately make an unfortunate situation worse. They will charge up front fees and make promises that may or may not be viable options. In Nevada, loan modification falls under the State Mortgage Lending Division. If an individual wishes to perform loan modification on their own in the State of Nevada, they must become licensed by the state and put up a $100,000 bond. You cannot charge up front fees and must provide the client with a "Right of Recision" clause, appropriate for the state law. It is advisable for the homeowner to check with their respective state to verify that the person or entity they are considering is a legitimate, licensed firm.
At Credit Capital Solutions, we take great care to insure the clients needs, questions, & concerns are answered with professional sensitivity. Clients are often scared and frustrated when they call us. Often times they are on the edge of foreclosure and do not know what they are going to do. We take the worry out of their hands and have often pulled people back from the edge of bankruptcy, and worked out a plan for them so they could remain in their homes...when this happens, everyone wins...the homeowner and the lender!
Below is a link to Credit Capital Solutions. Check out the site and feel free to email me with any questions, comments, or referrals.
martincasper.ccs@gmail.com
http://tinyurl.com/b4qo4n
Saturday, February 28, 2009
Thursday, February 26, 2009
$3.6 Trillion Dollars...What Is Next? How Far Can It Go?
President Obama has just unveiled a budget that is over $3.55 trillion for next year. Billions have been set aside for health care and the financial sector...the question arises...how much of this will actually filter down to the end users that need the most help. Obama has said that "we must add to our deficits in the short-term to provide immediate relief to families and get our economy moving." In addition to this proposed budget, spending will be increased to $3.94 trillion for 2011. At that point, the projected deficit will be over $1.75 trillion.
This is "change", as we so often heard about during the presidential race, but is this the type of "change" we want? What ever happened to cutting spending? I believe that we have to take dramatic steps to stop the tsunami meltdown within the financial sectors, specifically the housing market...but why do we not hear about cutting programs that are out of date and are "porking" the budget along with the taxpayers. It has been reported that the top 40% of income earners pay 90% of the income taxes. Simply stated...60% of the population pays 10% of the income tax...go figure...The budget calls for $637 billion in higher taxes on the estimated 5% of taxpayers with annual adjusted income of $250,000 or more.
Is this the type of "change" we really want? We need to see our government really being fiscally prudent, not just spending more money. I agree that we need to take some dramatic steps in the short term, but this needs to be augmented by cutting unnecessary spending in an aggressive manner, to keep our deficit under control and restore this economy to the level that we as Americans deserve and demand.
This is "change", as we so often heard about during the presidential race, but is this the type of "change" we want? What ever happened to cutting spending? I believe that we have to take dramatic steps to stop the tsunami meltdown within the financial sectors, specifically the housing market...but why do we not hear about cutting programs that are out of date and are "porking" the budget along with the taxpayers. It has been reported that the top 40% of income earners pay 90% of the income taxes. Simply stated...60% of the population pays 10% of the income tax...go figure...The budget calls for $637 billion in higher taxes on the estimated 5% of taxpayers with annual adjusted income of $250,000 or more.
Is this the type of "change" we really want? We need to see our government really being fiscally prudent, not just spending more money. I agree that we need to take some dramatic steps in the short term, but this needs to be augmented by cutting unnecessary spending in an aggressive manner, to keep our deficit under control and restore this economy to the level that we as Americans deserve and demand.
Wednesday, February 18, 2009
President Obama Unveils $75 Billion Mortgage Relief Plan
President Obama rolled out a very aggressive mortgage relief plan today that is a step in the right direction to stopping the tsunami of real estate foreclosures. The plan includes $75 billion in assistance for troubled borrowers...up from the original projected $50 billion budget.
The key lies in forcing the banking industry to capitulate and work with home owners that are in trouble of losing their homes. Banks have only recently begun to work with home owners to modify their loans, thus allowing them to remain in them. It is a bit of a "Catch 22" though...it is in the best interest of the banks to work out extended terms with customers who are in financial stress due to hardship. Even though the banks will take a reduced rate or payment, they will get the revenue back over a longer period of time. The banks will get their money, but what about the contracts they have with secondary investors who are the real owners of the loans, unless it is Fannie or Freddie? Will the banks be protected from investor lawsuit?
One way that the Obama administration is forcing the banks to capitulate by this measure is through TARP. Those that took TARP money, have to comply and work with borrowers. Again...the "Catch 22"...this can be good on one hand due to the fact that previously the banks were not willing to work out terms with troubled borrowers. With proper negotiation, we should see a decrease in foreclosures. Banks will receive incentives from the federal government to go along with this mandate. However, the caveat is...by doing this, the government is taking more control of our lives...do we want this? Is this necessary? Is it prudent? My opinion is this...I do not believe that government should play an active part controlling our lives in a free capitalistic society. That being said, we are in a crisis that we have not seen since the Great Depression of the 30's. All of us have been hit financially in one way or another. Sometimes more drastic measures have to come into play to resolve issues...this is one of those times.
Unfortunately we are mortgaging our future in terms of debt and tax issues. The current economic crisis can be brought under control with this type of regulation being temporary in nature, but not a permanent solution. It is very important that we do not become more government controlled on a continuum.
The key lies in forcing the banking industry to capitulate and work with home owners that are in trouble of losing their homes. Banks have only recently begun to work with home owners to modify their loans, thus allowing them to remain in them. It is a bit of a "Catch 22" though...it is in the best interest of the banks to work out extended terms with customers who are in financial stress due to hardship. Even though the banks will take a reduced rate or payment, they will get the revenue back over a longer period of time. The banks will get their money, but what about the contracts they have with secondary investors who are the real owners of the loans, unless it is Fannie or Freddie? Will the banks be protected from investor lawsuit?
One way that the Obama administration is forcing the banks to capitulate by this measure is through TARP. Those that took TARP money, have to comply and work with borrowers. Again...the "Catch 22"...this can be good on one hand due to the fact that previously the banks were not willing to work out terms with troubled borrowers. With proper negotiation, we should see a decrease in foreclosures. Banks will receive incentives from the federal government to go along with this mandate. However, the caveat is...by doing this, the government is taking more control of our lives...do we want this? Is this necessary? Is it prudent? My opinion is this...I do not believe that government should play an active part controlling our lives in a free capitalistic society. That being said, we are in a crisis that we have not seen since the Great Depression of the 30's. All of us have been hit financially in one way or another. Sometimes more drastic measures have to come into play to resolve issues...this is one of those times.
Unfortunately we are mortgaging our future in terms of debt and tax issues. The current economic crisis can be brought under control with this type of regulation being temporary in nature, but not a permanent solution. It is very important that we do not become more government controlled on a continuum.
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