Seriously. Do you think that “either” of the candidates are “worthy” to be president of the United States of America??
Well, our government once again is out to proctect its citizens from those that would do us harm..
Those bad pay day lending companies have been ripping off the poor people of Ohio for the last time..
OK.. Now that I am done with the B#%$ S&#^, let’s get down to business..
What gives the government the right to tell companies how much they can charge to do business??
If they weren’t providing value to consumers then obviously they would no longer be in business..
You can read more on this topic at: http://blog.mises.org/archives/008112.asp
I really just needed to vent because I do NOT like the government “interfering” with business operations and presonal property rights.
You can read more at the Mises Institute website.. http://blog.mises.org/archives/008112.asp
It just goes to show you that you should be very careful when sending messages via email.
Countrywide Financial’s CEO and founder Angelo Mozilo accidently hit the reply all button and included a homeowner that was requesting that his mortgage loan terms be modified.
After some negative attention it seems that Countrywide has responded by helping this homeowner keep his home.
I have often wondered what the statistics were for individuals that are in the process of foreclosure.
What exactly happened to cause these people to stop making their mortgage payments?
Did they lose their job, get a pay cut, get a divorce, become sick or disabled or just plain coulnd’t continue to make the payments on the debt obligations?
You would think that the home mortgage would be the last debt that would suffer if you got in a crunch.
This is one of the reasons why each individual should manage their debt and probably put together a plan to eliminate all of their high interest debt.
In the past few weeks there have been a very large number of Sheriff Sale notices in our local newspaper.
I have considered trying to contact the borrowers to find out what exactly caused them to get so far behind on their payments.
Locally, we have been hit a couple times with layoffs and the major employers.
This would obviously have an impact on any homeowner let alone the marginal ones that were barely able to make their debt payments.
If anyone has heard of any studies done on this, I would be very interested in seeing the results.
With the housing market slump reaching a possible peak in the next 12 months, you have to consider whether now is the best ime to put your house on the market.
Many people have found themselves in a situation where they cannot sell their homes.
These are 500,000+ houses in the process of foreclosure and a glut of homes for sale currently.
This puts those in the need of selling there homes in a precarious position.
So, do you keep your house on the market and run the risk of losing it due to foreclosure OR do you refinance your mortgage to make the overall payments on your debt more manageable??
Great question BUT not an easy one to answer.
If you are having trouble meeting your mortgage payments and it doesn’t look like your situation is going to change in the near future, maybe it is time to think of changing careers and starting a business to generate new income.
An increase in income is an easier answer than cutting your bills.
There are many legitimate business opportunites today and ways to increase your income without a tremendous amount of upfront money.
Right where you live there are probably a number of ongoing businesses for sale that could help you increase your income OR just do something that you love.
Here is an example of a small retail tax preparation business that is for sale in a small town in Ohio.
Most people need an extra $500-750 per month and this would completely change their financial situation.
You should consider increasing your income first before making major changes by selling your home in a down market and refinancing when this may NOT even be an option due to lack of equity in your home.
Next time I will recommend (2) of the top places to go for credit advice and the best place to go if you are considering a refinance.
Over the past few weeks there has been much talk about a bail-out for mortgage borrowers that are behind on their mortgage payments.
Literally everyone is talking about this topic.
I get at least 2-3 emails a day addressing this issue.
George Bush discussed it and the government is making plans..
Bill Gross (manager of largest bond portfolio with PIMCO) said that borrowers need bailed-out NOT lenders!!!
Jim Cramer from CNBC mad-money had a meltdown the other day concerning Bernanke hestitaing in dropping the discount rate.
SOOOO— The question is: “Does all this really matter to you?”
“How does it affect your chances of getting a debt consolidation loan?”
Well, that still remains to be seen.
Lender’s have tightened their lending practices over the past few years and made it more difficult to refinance your home mortgage.
Obviously, there are good reasons for this to take place. If these practices would have been in place a few years ago we wouldn’t be talking about a sub-prime mortgage crisis.
The IS the “exact” reason for each of us to stay on top of our credit reports and make sure that we are making our payments on time.
Those with below average credit histories WILL have a tougher time lowering their interest rates and lowering their monthly payments UNLESS– The government has some type of plan to help out with this.. (Don’t hold your breath.)
Even IF they do come up with a plan, I am quite confident that it will NOT benefit most people.
So, what do you do??
It really depends on your individual situation.
IF you are currently able to make your monthly payments on your mortgage your obviously are in a better position than the MILLIONS of American’s that are currently in default. (90 days+ behind on their payments)
I ALWAYS hate to recommend belt-tightening strategies BUT in some cases there is no other alternative.
Sometimes cut your losses (sell the house, etc) is the ONLY option.
No matter what though, a “well thought out”, “clear cut” plan is the ONLY solution.
You must know where you want to be OR what position you want to be in before making ANY decisions.
The first step is:
-Organize eveything and come up with the total amount of debt that you have to be eliminated.
Write it down and post it somewhere just like you would any goal.
I want to know “exactly” what that number is so I know where I stand.
Once you have that number, then, and only then, can you begin orchastrating a plan.
The key is, to put yourself in a position so that it doesn’t matter what the economy does, or what any other outside influence does have an affect on you.
You want to be on the outside of all of this so that a government bail-out, the sub-prime crisis, the stock market dropping, recession ,etc has>>
NO AFFECT ON YOU..
Start today by organizing your finances and coming up the THE number.
Have a great weekend,
William L. Beavers
There has been much written about how to payoff or eliminate your debt.
Most of the techniques recommended are OK but lack the true mechanics about how most people handle their finances.
The common theme is to gradually payoff each debt by paying a little extra each month onto the smallest debt obligation.
To totally payoff everything immediately by re-financing your home mortgage to lower the overall monthly payments.
Neither of these are necessarily bad ideas except they do NOT take into account the lost “opportunity cost” or what to do with the excess income you have now once your monthly payments are lower. (It also does not take into account something I talked about in an earlier post, the tendency for most people to turn right around and create new debt outside of the mortgage so they end up in the same “hole/position” again.)
One of the common misconceptions is that paying off ALL of your debt is good.
However, there is: Good debt AND Bad debt.
It would appear that ALL debt is bad debt BUT, this is far from true.
Most “consumer” debt IS bad debt and more than likely “should” be paid off.
When you borrow to invest in a business, is this bad debt?
This would be considered Good debt. (Of course, assuming this business is a good investment.)
From a cash flow perspective as long as the business can pay for the debt this works.
In other words, the business is at positive cash flow or showing a net profit when you include the debt payment as an expense.
Using debt to purchase investment real estate could also be considered good debt.
So, in conclusion, struggling to get out of debt may not be the best method for some people.
In a future post I will discuss the methods used to build wealth without paying off your debt.
Is getting a Debt Consolidation loan a good way to start the process for eliminating your debt obligations?
With the wave of mortgage refinance hitting a peak a few years ago, this is not as much of an issue as it once was.
Many people are still in a position from an equity perspective (in other words, they still have equity in their homes) to put themselves in a better position from a cash flow perspective. (By consolidating their debt.)
The question is, “When is it good to do this”?
Well, quick frankly there are a lot of times when it is NOT good.
Most people that refinanced over the past few years, did NOT use the money that they were saving wisely.
Let me give you an example.
Say you refinanced some debt and were able to cut your monthly outgo/loan payments by $450.
You consolidated some Credit card debt, maybe a car loan, etc.
Now, what did you do with the extra $450 per month? (assuming that you were making the payments on the other loan obligations before the refinance. Obvisouly, some people refinance bad debt that they weren’t making there monthly payments on.)
SOO- what did you do with the extra $450?
A large portion of the people—
—Went right back out and FINANCED OTHER CONSUMER ITEMS!!!
To put themselves right back in the same hole again.
THIS is where the “proper allocation of capital” comes in that we will be speaking of in the future.
Obviously, there ARE bad loans but most of the time it is “poor management of money” after the refinance.
More on this topic later..
In today’s fast paced super hyped society, we can only take in so much information.
Most families today have both spouses working and have little time to truly evaluate their current financial situation.
The amount of financing options available to everyone has us wrapped so tight that we cannot focus on the people and ideas that are important to us.
The key is to truly get a grip on what the real numbers are in OUR financial world.
The key numbers are:
1) Amount of income per month.
2) Amount of our expenses per month.
3) How much is leftover.
For most people the last number is ZERO!
That IS the problem.
You either have to spend less or make more to get ahead. (At least that’s what we are told.)
But, is this true?
How about the “proper allocation of capital”?
Have we taken this into consideration?
Living paycheck to paycheck has become a way of life and actually, sucks the life right out of us.
In a future posting I will give you the step by step instructions for eliminating your debt and getting a handle on your finances.
I will also properly explain the term “proper allocation of capital”.
Until then, I would love to hear comments on what your thoughts are on the issue of debt in the American household.
Thanks and talk to you soon.
Hi. This is William. Do you know how to get rid of your debt?
On this Blog I will be sharing my 20 years of experience in the financial services industry helping hundreds of individuals and families free themselves from the burden of unnecesary debt obligations.
Looking forward to hearing from you all.