.
The credit crunch is in full swing, and everyone is feeling the pressure. Workers and businesses are experiencing the impact because banks aren’t loaning money. Financial institutions aren’t even lending to each other, and you can feel the tension in the air.
The passage of the $700 billion bailout by Congress was supposed to ease fears on Wall Street, but we all watched the stock market tumble over the last week. Now, everyday Americans are wondering how this bailout will affect them, but only time will tell. In the meantime, consumers without great credit aren’t getting any loans.
The real question we should be asking ourselves is how this mess was started. We can all blame both the Republicans for deregulation and the Democrats for trying to give everyone a home. Since no one is solely to blame, we must look at the true cause – subprime mortgages.
From 2001 to 2006, subprime mortgages ran rampant through our country. Greedy banks and foolish borrowers started the economic roller coaster we are all on today. Instead of doing traditional underwriting, such as looking at job history and current debt, banks focused only on credit scores and used the lack of regulation in Washington to sign up uninformed consumers. These financial institutions gave away 105 percent mortgages to people who had no ability to repay the debt, and then sold these mortgages in bundles to Wall Street.
The construction industry fed on these easy mortgages, and the real estate market skyrocketed. Housing prices raced toward their peak. People were buying investment properties left and right because they were excited about the prospect of cashing out in the hot market. But that was the problem -- many of these home loans were given to people with credit histories that wouldn’t have allowed them to get a loan 10 years ago.
Then the real estate market came to a halt, and it started to readjust. Here in Florida the real estate market has been hit hard during the past year. Sales have slowed and prices are falling. The lower prices have left many people owing their lenders more than their homes are worth, meaning the owners can't refinance or sell their homes without paying the difference between their mortgage balances and what the homes are now worth.
Many of our clients are concerned about their own adjustable-rate mortgages and they are looking for answers. Unfortunately, we don’t know when or if we will feel any relief from the Washington bailout. Until then, I encourage you to instruct your clients to follow the basic tips below to help ease their own fears while also preparing for the worst.
1. Reduce unnecessary spending.
2. Have three to six months worth of income in a secure savings account.
3. Pay down credit card debt.
4. Make extra mortgage payments to pay down the principal.
5. Call lenders before a mortgage adjusts to see if they will help.
Douglas Muir, CEO
Q. What kind of Borrower qualifies for a mortgage loan modification?
A. Each lender has its own policies, but the general requirement is that you have a job and be able to prove a financial hardship. This tells your lender two things:
1. Falling behind in your monthly payments wasn’t entirely your fault
2. Modifying your loan can really help you back on your feet.
Q. What is a good example of a modifiable loan?
A. Anyone in financial trouble may be helped, but certain conditions can make our job easier. Ideal clients are those who:
- behind in payments or are already in foreclosure
- have received a notice of default
- have an adjustable-rate mortgage that has already increased
- have negative amortization loans
- are experiencing financial hardships due to bad or predatory lending, income reduction or illness or other “hardship”
- steady source of income to pay the modified payment
The “Text Book” file is a mortgage holder that has an adjustable rate mortgage (ARM) and is having trouble making payments after the adjustment or foresees a problem after the adjustment happens. All types of loans can be modified: ARM’s, negative amortizing loans, interest only loans, investment or commercial property.
Q. Can unemployed homeowners be helped?
A. No. You need a source of income to qualify for mortgage loan modification.
Q. Do you count the income of people who are living in the home but are not on the title?
A. Yes. The total income of the household is considered, not just the homeowner’s income.
Q. I need financial help paying the mortgage payments that are behind. What are my options?
A. Many people think they need to pay off their debts before they can try anything else. That’s simply not the case. Mortgage modifications can be very powerful and very flexible. During a modification, it’s possible to eliminate back payments you owe in addition to lowering your monthly bill.
Q. Do I need to be delinquent or behind in my mortgage?
A. No, but it will make things easier. Loan modification is meant to help people in financial hardship, and banks are more willing to help borrowers in trouble and that typically means you are behind in your payments.
Q. I’m already behind on my mortgage payments, is there anything I can do?
A. There are always options. If you’re behind on your mortgage, you may be a perfect candidate for a loan modification. It can help save you money by lowering your mortgage payments and stop foreclosure process that may be threatening your home.
Q. Is it too late to help clients who are in foreclosure?
A. Definitely not! Foreclosure can be prevented up to a few days before the actual transfer sale date. However, if you are thinking of getting help, please don’t wait until you have received a notice of sale. It’s important to take action.
Q. Can you help me stop foreclosure?
A. In most cases, help to starve off foreclosure is achieved by negotiating with your lender or servicer. Remember they do not want to own your home. That is a lose-lose situation. A hold can generally be put on your foreclosure status, but you’ll need to act quickly. The sooner you begin working on this issue, the easier it will be to stop the foreclosure process - even if you’ve been in the foreclosure process for a while.
Call 904-757-0880 for more information and to see if you qualify for mortgage loan modification.
However, over the years, I’ve come to realize that some of my most rewarding moments have been volunteering in my community. Most recently, these efforts have included volunteering as coach of the Fernandina Beach High School wrestling team. The Florida Times-Union newspaper and the Scotsman Guide were kind enough to feature my philanthropic endeavors in their publications. Please visit (insert link) to read the articles.
I want to encourage all AEs and CCCs to get involved with a cause in their communities. There are several positive benefits to community service, and most people are surprised by how many business leads they receive while working toward a goal with other like-minded people. The following list provides some reasons to get involved.
1. Community participation is a great way to feel connected to the area in which you live.
2. The best networking happens when you’re participating in something you enjoy.
3. Traditional functions, such as Chamber of Commerce networking meetings, can get stale after awhile, especially if you keep running into the same crowd of people. Break out of that networking rut!
4. When you volunteer for a cause, you can give something back to the community while also gaining trust and respect from the people around you.
5. Forming relationships outside of work may attract new clients. In today’s economy, everyone knows someone experiencing credit problems.
At CJS, we are all dedicated to consumer rights. Since we are in this fight for more than just money, it is our social responsibility to participate in our communities. Being an AE or a CCC with CJS means reaching out to people who need help, and being a community volunteer is a perfect way to spread that message.
Douglas Muir, CEO
What is Peer Lending?
The Wrong Kind of Thrills
"Head in the Sand" Poor Strategy When Facing Forec
view all blog entries...
Don’t be scared – be prepared
Consumers need to take personal action to protect themselves
by valeria on Mon Mar 08, 2010 6:24 pm
The credit crunch is in full swing, and everyone is feeling the pressure. Workers and businesses are experiencing the impact because banks aren’t loaning money. Financial institutions aren’t even lending to each other, and you can feel the tension in the air.
The passage of the $700 billion bailout by Congress was supposed to ease fears on Wall Street, but we all watched the stock market tumble over the last week. Now, everyday Americans are wondering how this bailout will affect them, but only time will tell. In the meantime, consumers without great credit aren’t getting any loans.
The real question we should be asking ourselves is how this mess was started. We can all blame both the Republicans for deregulation and the Democrats for trying to give everyone a home. Since no one is solely to blame, we must look at the true cause – subprime mortgages.
From 2001 to 2006, subprime mortgages ran rampant through our country. Greedy banks and foolish borrowers started the economic roller coaster we are all on today. Instead of doing traditional underwriting, such as looking at job history and current debt, banks focused only on credit scores and used the lack of regulation in Washington to sign up uninformed consumers. These financial institutions gave away 105 percent mortgages to people who had no ability to repay the debt, and then sold these mortgages in bundles to Wall Street.
The construction industry fed on these easy mortgages, and the real estate market skyrocketed. Housing prices raced toward their peak. People were buying investment properties left and right because they were excited about the prospect of cashing out in the hot market. But that was the problem -- many of these home loans were given to people with credit histories that wouldn’t have allowed them to get a loan 10 years ago.
Then the real estate market came to a halt, and it started to readjust. Here in Florida the real estate market has been hit hard during the past year. Sales have slowed and prices are falling. The lower prices have left many people owing their lenders more than their homes are worth, meaning the owners can't refinance or sell their homes without paying the difference between their mortgage balances and what the homes are now worth.
Many of our clients are concerned about their own adjustable-rate mortgages and they are looking for answers. Unfortunately, we don’t know when or if we will feel any relief from the Washington bailout. Until then, I encourage you to instruct your clients to follow the basic tips below to help ease their own fears while also preparing for the worst.
1. Reduce unnecessary spending.
2. Have three to six months worth of income in a secure savings account.
3. Pay down credit card debt.
4. Make extra mortgage payments to pay down the principal.
5. Call lenders before a mortgage adjusts to see if they will help.
Douglas Muir, CEO
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FAQ on Mortgage Modification Program
Te purpose of a mortgage loan modification is to simply help the home owner remain in their home with monthly payments that they can afford. Recent government incentives make mortgage loan modification a win/win situation for both the home owner and lender.
by valeria on Mon Mar 01, 2010 7:11 pm
Q. What kind of Borrower qualifies for a mortgage loan modification?
A. Each lender has its own policies, but the general requirement is that you have a job and be able to prove a financial hardship. This tells your lender two things:
1. Falling behind in your monthly payments wasn’t entirely your fault
2. Modifying your loan can really help you back on your feet.
Q. What is a good example of a modifiable loan?
A. Anyone in financial trouble may be helped, but certain conditions can make our job easier. Ideal clients are those who:
- behind in payments or are already in foreclosure
- have received a notice of default
- have an adjustable-rate mortgage that has already increased
- have negative amortization loans
- are experiencing financial hardships due to bad or predatory lending, income reduction or illness or other “hardship”
- steady source of income to pay the modified payment
The “Text Book” file is a mortgage holder that has an adjustable rate mortgage (ARM) and is having trouble making payments after the adjustment or foresees a problem after the adjustment happens. All types of loans can be modified: ARM’s, negative amortizing loans, interest only loans, investment or commercial property.
Q. Can unemployed homeowners be helped?
A. No. You need a source of income to qualify for mortgage loan modification.
Q. Do you count the income of people who are living in the home but are not on the title?
A. Yes. The total income of the household is considered, not just the homeowner’s income.
Q. I need financial help paying the mortgage payments that are behind. What are my options?
A. Many people think they need to pay off their debts before they can try anything else. That’s simply not the case. Mortgage modifications can be very powerful and very flexible. During a modification, it’s possible to eliminate back payments you owe in addition to lowering your monthly bill.
Q. Do I need to be delinquent or behind in my mortgage?
A. No, but it will make things easier. Loan modification is meant to help people in financial hardship, and banks are more willing to help borrowers in trouble and that typically means you are behind in your payments.
Q. I’m already behind on my mortgage payments, is there anything I can do?
A. There are always options. If you’re behind on your mortgage, you may be a perfect candidate for a loan modification. It can help save you money by lowering your mortgage payments and stop foreclosure process that may be threatening your home.
Q. Is it too late to help clients who are in foreclosure?
A. Definitely not! Foreclosure can be prevented up to a few days before the actual transfer sale date. However, if you are thinking of getting help, please don’t wait until you have received a notice of sale. It’s important to take action.
Q. Can you help me stop foreclosure?
A. In most cases, help to starve off foreclosure is achieved by negotiating with your lender or servicer. Remember they do not want to own your home. That is a lose-lose situation. A hold can generally be put on your foreclosure status, but you’ll need to act quickly. The sooner you begin working on this issue, the easier it will be to stop the foreclosure process - even if you’ve been in the foreclosure process for a while.
Call 904-757-0880 for more information and to see if you qualify for mortgage loan modification.
Community service can help your business too
During the last 10 years, I’ve been blessed to have several of my companies reach success and to achieve my entrepreneurial goals. I’ve watched CJS grow and expand to more than 46 states, and now – because of the commitment and hard work of my CCCs and AEs – it is the fourth-largest credit repair company in our country.
by valeria on Wed Feb 24, 2010 4:22 pm
However, over the years, I’ve come to realize that some of my most rewarding moments have been volunteering in my community. Most recently, these efforts have included volunteering as coach of the Fernandina Beach High School wrestling team. The Florida Times-Union newspaper and the Scotsman Guide were kind enough to feature my philanthropic endeavors in their publications. Please visit (insert link) to read the articles.
I want to encourage all AEs and CCCs to get involved with a cause in their communities. There are several positive benefits to community service, and most people are surprised by how many business leads they receive while working toward a goal with other like-minded people. The following list provides some reasons to get involved.
1. Community participation is a great way to feel connected to the area in which you live.
2. The best networking happens when you’re participating in something you enjoy.
3. Traditional functions, such as Chamber of Commerce networking meetings, can get stale after awhile, especially if you keep running into the same crowd of people. Break out of that networking rut!
4. When you volunteer for a cause, you can give something back to the community while also gaining trust and respect from the people around you.
5. Forming relationships outside of work may attract new clients. In today’s economy, everyone knows someone experiencing credit problems.
At CJS, we are all dedicated to consumer rights. Since we are in this fight for more than just money, it is our social responsibility to participate in our communities. Being an AE or a CCC with CJS means reaching out to people who need help, and being a community volunteer is a perfect way to spread that message.
Douglas Muir, CEO
The Wrong Kind of Thrills
"Head in the Sand" Poor Strategy When Facing Forec
view all blog entries...
