Home Loan Modifications

You may be aware of "home loan modifications" being talked about in the news, but do you understand the who, what, when, where, and why of them?

I created a website to answer those questions, hopefully in a clear manner. Check it out at: http://loanmodifications4help.homestead.com/ The most important reason I did this was because scams and rip-off's are all over the place preying on people who really need a loan modification - it's easy money for the scam artists. I have a friend who may have fallen for the "give me $3,000 and I'll get you a loan mod." It's been 3 months and I'm afraid she's not only lost her money but also just wasted 3 precious months.

Biggest, most important piece of information is DO NOT PAY ANYONE UP FRONT. The best loan modification companies will give you a free consultation and if they think they can help you, charge you an "application fee" to cover their costs of filing the paperwork and negotiating on your behalf. that usually is about $500. They will only charge you the balance of their fee upon a successful agreement.

And you can request one for yourself. Individuals who are financially savy and who understand how to negotiate with a bank negotiator can be successful without paying a loan modification company. Like with everything there are pro's and con's to both ways.

It's going to cost you about $3,000 to have a loan modification company do it for you. But the good ones have connections to the decision-makers and know how to negotiate with them. Most individuals are going to deal with much lower-level staff who have limited ability to negotiate the terms they can offer. Remember, there are thousands and thousands of people asking for loan mods and the staff the banks and mortgage companies have put in place to handle all of these requests are following strict guidelines and have limited authority.

I happen to personally know a guy that was a mortgage broker who helped me re-finance a house a couple of years ago. He and a partner have started a Loan Modification company and I can recommend him confidently. He's honest and ethical and will do right by you. And he and his partner have superb connections in the banking and mortgage community. He told me just the other day that even if someone was a week away from foreclosure they could possibly still help them. So if you want more information on loan mods go to the website I created at http://loanmodifications4help.homestead.com/ and pass the information along to others.

We're all in this rotten economy together...let's help each other whenever we can.

Getting Back to Blogging

I'm sorry I haven't been updating the blog! It's been very busy for me and like with everything else, the squeeky wheel gets the attention and I've had a lot of squeeky wheels lately. But I'm back and committed to giving you interesting things to read.

A quick note to update two earlier blog posts. Using a "virtual" credit card just saved me $179...I was interested in a product that said it would give me 3 months free when what they meant to say was the price was reduced by the equivalent of 3 months...pay for 9 get 12. Thank goodness I used my virtual credit card with a maximum payment amount of $1 so I could try it for 3 months and not have it automatically charged to my account in 3 months. The charge of $179 got declined and I was saved from instituting a dispute. Especially with automatic download products this is a sticky area...if the charge had gone through and I had immediate availability to the product would I have had an argument on my hands? The moral is, use those "virtual" credit card numbers - they are great!

Second update is about the credit card that sent me a letter saying if I wanted to continue to use it my interest rate would go to about 30% - upon calling them they said if I declined to accept the new conditions I could continue to use the card under the existing conditions until the end of January '09 and then the card would become invalid - but I could continue to pay-off the balance under the old rate until it was paid off. Since I just got a new card in July with an expiration date of 07/11 I thought I was fine and I certainly didn't want to be paying 30%!

Now the newest statement has a line on it saying "You've been sent new credit cards - be sure to sign them and activate them when you receive them." Hmmm, so because I declined the new terms they are issuing a new card...fair enough, I wasn't going to use that account anymore. But I'm very interested to see what the expiration date is on the new card...I'm thinking my 2-1/2 window of time to pay-off the balance is going to be reduced by giving me a new expiration date with the new card. Just a guess, but I'll know soon.

So read those new terms and conditions the credit cards are sending...I'll bet most used to get tossed into the trash, but in this new economy you need to understand what terms they are changing and how it affects you. If it's not understandable call the 800 # and have them explain it to you.