Foreclosure Relief Efforts: Foreclosure Rates Rise 7% in July
Government foreclosure prevention programs are falling short of their purpose of preventing home mortgage foreclosures, as indicated by July’s rise in foreclosure notices filed. Financial experts estimate that 1 in 355 homes in the US is in foreclosure according to RealtyTrac, a firm specializing in reporting real estate trends. The worsening foreclosure trend is highlighted by foreclosure numbers for July 2009 as compared to July 2008. This year, about 87,000 mortgages were foreclosed as compared to July 2008’s estimate of 79,000 residential mortgage foreclosures. Federal Treasury Secretary Tim Geithner and HUD Secretary Shaun Donovan recently sent a letter to major mortgage lenders encouraging them to do more, and to do better with foreclosure relief efforts through programs including Hope Now and Making Home Affordable.
Mortgage Relief: Roadblocks, Logjams Not Helping Homeowners
Mortgage loan servicers, the companies engaged by mortgage holders to take care of day to day loan servicing needs, are reportedly overwhelmed with requests for assistance. Some lenders have established waiting lists, and while desperate homeowners wait, they may not be making their mortgage payments, which potentially increases losses associated with foreclosure. If you’re having problems getting in touch with your mortgage servicing company, getting help from a non-profit debt consolidation program can help you develop a household budget appropriate to your current circumstances, and may be able to assist with a mortgage modification or repayment plan. Go here to learn more about avoiding foreclosure and finding non-profit credit counseling and mortgage relief programs.
Debt Consolidation Programs: Reducing Foreclosure Risk
Homeowners faced with job loss or steep reductions in income due to layoffs or illness may be tempted to let a mortgage payment go in favor of placating aggressive collectors working to collect unpaid consumer debt. Faced with having wages garnished or making a decision between paying bills or buying groceries, it can be easy to “rob Peter to pay Paul.” Non-profit debt consolidation programs offered through consumer credit counseling services can help by negotiating repayment terms with creditors; reducing interest rates, late fees and other finance charges can help whittle down monthly payment amounts to affordable levels. Consumer credit counseling services work with credit card companies and other creditors to make arrangements typically not offered to consumers making individual requests.
Credit Counseling Services Caution Against Procrastination
The more you owe, the more difficult it is to make affordable repayment arrangements with creditors. If you’re having problems making payments on your mortgage or other debts, please seek help today. Non-profit debt consolidation programs can help you regain your financial footing as you learn how to manage and adjust your budget to suit changing circumstances.
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Loading ...Consumer Debt Declines for Fifth Consecutive Month
The Federal Reserve reports that consumer debt decreased in June, which represents the fifth consecutive month of declining rates of consumer borrowing. This suggests both good and bad news, as some consumers voluntarily curtail spending while others are being denied credit. The Fed suggests that borrowers who are spending less and saving more contribute to economic recovery as their household budgets stabilize.
Controlling Credit Card Debt
Buying what you can’t afford with money you don’t have can lead to trouble, especially as layoffs, corporate downsizing and prolonged unemployment continue. As consumers continue to worry about the economy, they’re either deciding to go without and pay down debt, or buying power is being curtailed by lenders that “just say no” to granting or extending consumer credit. This combination of consumer and lender reluctance seems to suggest that now is as good a time as any to declare your freedom from depending on credit cards for everything from groceries to Gucci. Debt consolidation is a first step toward becoming debt free.
Debt Consolidation: Three Methods
Benefits of debt consolidation include streamlining debt management and possibly reducing finance charges and monthly payment amounts. Getting unsecured personal loans for debt consolidation can be difficult, so here are alternative methods for consolidating debt.
- Credit card balance transfers: Although many credit card companies are cutting credit lines and refusing new credit, they continue to promote transferring balances from competitors’ cards. Balance transfers can help you clean up multiple small balances, but beware of transfer fees and hidden costs.
- DIY Debt Consolidation: If you have problems with compulsive spending, or spend more than you can afford, you can sabotage a debt consolidation plan. DIY debt consolidation requires listing all of your debts and paying them off one by one. Continue making minimum payments on all of your debts except the debt with the highest APR, which means it’s the most costly. When the highest APR debt is paid off, you progress through your debts by “rolling over” the amount you were paying on the first debt to the second, and so on. Keep records and review them monthly. Seeing your debt decrease each month can help you avoid overspending.
- Getting Debt Help: Contact a credit counseling service for help if you doubt your ability to control spending. Credit counseling services help you formulate a cash budget and can also negotiate affordable repayment plans with creditors. Credit cousneling agreements require you to close your credit card accounts, and they cannot guarantee tht you’ll qualify for new credit after your debt repayment plan is completed.
- Avoiding More Trouble: Refuse unsolicited offers of debt help, and check references when seeking debt assistance. The National Foundation for Credit Counselors (NFCC) can help you locate an accredited credit counseling service in your area .
Getting your finances on track by eliminating debt can help you plan for a future that includes financial security and peace of mind.
(No Ratings Yet) Loading ...Debt Consolidation First Step Toward Debt Stress Relief
Reports of massive celebrity debt highlights potential stress associated with excess debt. Although most of us don’t face millions of dollars in debt, having more debt than you can comfortably pay can cause levels of stress that can potentially affect your health. If debt is causing physical or emotional stress, debt consolidation can help. Here are some steps for getting started:
- Know what you owe: You can’t deal with debt until you know the extent of the problem. If you’ve been using the “ostrich method” of dealing with debt by putting off paying bills until “later,” or avoiding communicating with creditors, your debt problems can only get worse. Debt doesn’t disappear unless you take control and formulate a plan.
- Write it down: Set up a spreadsheet or other system of tracking each account you owe, payments made, and current balances. You should also note the annual percentage rate (APR) for each account, as this can help you make a plan for consolidating and paying down your debts.
- Prioritize debt: Address debt with the highest APR first, unless you have some small balances that can be quickly eliminated.
Determining Debt Consolidation Options
Available options largely depend on your credit scores. Although you can get one free credit report annually from each of the three major credit reporting bureaus, you’ll have to purchase credit scores. Debt consolidation helps in reducing the number of debts you have, which streamlines debt management chores. Here are some debt consolidation options:
- Home equity line of credit: If you’re a homeowner, and have enough home equity, you may be able to get a home equity loan that provides cash for paying off credit card debt and other consumer loans such as auto loans and medical bills.
- Personal debt consolidation loan: If you don’t own a home, but do have good to excellent credit, you may be able to qualify for a debt consolidation loan. With the current credit climate, this may not be feasible unless you can borrow enough at a significantly lower APR than your credit card debt.
- Balance transfers: Credit card companies frequently promote balance transfers by offering low or no interest rates on balances transferred from other accounts. This can save money and help reduce debt, but understanding the full cost of transferring balances is essential to deciding if and where to transfer balances. Most credit card companies charge a balance transfer fee of about 3% of the balances being transferred. This makes sense if you’re able to pay off transferred balances before the low or no interest rate promotion expires.
Investigating several debt consolidation methods can help you find debt consolidation help that works for you.
Don’t Derail Your Debt Consolidation Plan
Good intentions can be undermined by temptation. Using credit cards sabotages your ability to pay off credit card debt. Seek help from a professional credit counseling agency if you doubt your ability to make and keep a debt consolidation and management plan.
(No Ratings Yet) Loading ...Credit Crisis Reduces Debt Consolidation Options
Bloomberg.com reported today that Federal Reserve Chairman Ben Bernanke hinted that the Federal Reserve is ready to lower interest rates at their next meeting before the end of this month. Some analysts are predicting a cut will come before then.
The article goes on to quote Bernank as saying, “Even households with good credit histories are now facing difficulties obtaining mortgage loans or home equity lines of credit.” He continued with, “Banks are also reducing credit card limits, and denial rates on automobile loan applications reportedly are rising.”
It has become increasingly difficult for consumers to borrow money. If you are currently exploring debt consolidation, you may need to get creative.
(4 votes, average: 5 out of 5) Loading ...Social Lending: A Popular Debt Consolidation Option
Social lending is becoming a popular debt consolidation option for many as the credit markets continue to tighten and consumers are finding it more difficult to obtain financing.
Prosper.com, one of the more popular social lending websites, recently released its usage statistics from July of 2008. 43% of the loans that funded through their service were for debt consolidation purposes.
Social lending, loosely defined, is the lending and borrowing of money between individuals. In the past, this type of lending traditionally took place between friends and family, however, new online services have made it possible to facilitate this sort of arrangement between strangers.
(3 votes, average: 4.67 out of 5) Loading ...- This blog covers a wide variety of debt consolidation and loan topics.
We rely on a large network of financial experts and leading authors to write the content for the DebtHelp.com Blog.
Colorado Study Looks at Debt Consolidation Services
House Votes to Move Up Effective Dates of Credit Card Reform Law
- November 2, 2009–November 8, 2009
- October 26, 2009–November 1, 2009
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- October 27, 2008–November 2, 2008
- October 20, 2008–October 26, 2008
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- October 6, 2008–October 12, 2008
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- March 17, 2008–March 23, 2008
- November 12, 2007–November 18, 2007
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- October 29, 2007–November 4, 2007
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Chris Rocks is the Regional Director of the National Credit Federation (NCF). NCF is a nationwide membership-based organization that assists consumers recovering from a financial difficulty and those who need a significant increase in their credit score.
Chris began his financial services career as a Financial Advisor helping young families with risk management and asset accumulation strategies. It was during that time that Chris realized that many of these young families also needed someone to guide their choices with regards to debt management.
He made the transition into the mortgage industry where he first worked as a loan originator and later the Vice President of a small mortgage company. As Chris came across clients who had suffered through financial challenges and saw the difficulty they had in re-entering our credit driven economy, he discovered there was a real opportunity to leverage his unique background and help others.
He can be contacted by visiting his personal site, GoodCreditLiving.com.
Francine L. Huff is the Publisher and Editorial Director of Super Savvy Publishing, LLC, which provides editorial and publishing services. She is a gifted author, freelance journalist, and motivational speaker who has entertained and motivated a variety of audiences through workshops, panels and keynote addresses. Francine is the author of The 25-Day Money Makeover for Women, which has inspired and motivated many readers to rein in poor financial habits, become good stewards over their money and work toward a debt-free life. She has appeared on a variety of TV and radio shows. Francine previously worked for the Wall Street Journal, where she was the spot news bureau chief, a news editor and a copy editor. She has interviewed a variety of financial professionals about financial issues and strives to present information about managing money in an easy-to-understand format that is accessible to people of all backgrounds and income levels.
Karen Lawson is a freelance writer with more than 15 years of experience working in mortgage banking and loan servicing. She holds BA and MA degrees in English from the University of Nevada, Reno.
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