Sunday, August 30th, 2009
There are different types of loan modification companies who can help you in modifying the mortgage payments and avoid all possible chances of foreclosure. Do thorough researches on the company before you decide to sign up with them. Here are the different types of companies offering loan modification programs.
- Mortgage Banker / Broker
These types of companies will generally charge you a fee of $1000 to $3000. This is probably the least desirable type of company to use to work on your loan modification. There is always a food for thought when dealing with such companies. Why will anyone like to work with such companies when they got you into such troubles in the first place? If you choose to work with this type of company, beware of slick sales pitches and attempts to collect large upfront fees. Get everything in writing and accept no verbal promises. If they promise you something and do not put it in writing, don’t get engaged with them.
- Loan Modification Company (non-attorney based)
These types of company will generally charge you a fee of $1000 to $3000. They are non-attorney based companies that have fewer teeth than a company that utilizes the services of an attorney but costs less money to use. Depending on the origins of the company, this could be a viable option. Make sure that you do a thorough research and ask lots of questions when dealing with one.
- Loan Modification Company (attorney based)
Their services generally cost between $2500 to $7000. These companies will usually use the services of an outside attorney to review loan documents and write letters on attorney letterhead. Attorney based companies have the force of implied threatened litigation behind them which enables them to gain the attention of your lender quickly. Remember this type of company is hiring an outside attorney which can be done by you as well.
- Loan Modification companies (attorneys on staff)
Their services generally cost between $5000 – $10,000. This is the toughest type of loan Modification Company. On staff attorneys give this type of company the ability to threaten litigation and follow through on your behalf. Be sure to probe the availability of legal services available here. Many of these companies will function as your advocate up until the time that litigation actually becomes necessary, and then have their own staff attorney take over the case for you, eliminating the need to find an attorney who is unfamiliar with your situation later on if needed. This type of company has the added benefit of being able to have their attorney switch gears to dealing with foreclosure, or bankruptcy if needed. The continuity of having the same familiar legal hands on your file from start to finish makes this a very attractive and cost effective option. Be sure to iron out when the attorney on staff would take over the file, and what the charges for that end of the services would be.
- Law offices
Services of Law Offices cost $150 – $450 per hour. The average loan modification file can have 40 to 60 hours of work into it by completion
40 X $150 = $6000 | 40 X $450 = $18000
You can see that this is by far the most expensive way of handling a loan modification. If a principal reduction is your goal, this could be well worth it. This option also has the sharpest teeth, if the firm specializes in RESPA, HOEPA, TILA and other lending laws, you could come out way ahead. Law firm letterhead will gain the attention of the lenders executives and move your file ahead of others at your bank. Make sure that they have been in this area of practice for a long time prior to the downfall in the market. If you are going to pay an attorney, make sure you are getting experienced, competent representation.
The company that you choose to hire will make or break your loan modification. You should make absolutely certain the company you choose to hire is going to work on your loan modification with the dedication and determination you would bring to the table. If you don’t get the feeling that they will take your negotiations personally, don’t hire them to work for you. Remember, if you are properly prepared, and educate yourself, you can have a professional do a loan document review/audit, prepare a report for you, and then take it from there yourself.
Posted in Loan Modification | No Comments »
Saturday, July 19th, 2008
Good credit scores are very important in order to get some financial help from a reputed financial institution. You will have difficulties in getting approved for an auto loan or a credit card if you are not having good credit. Based on your previous credit history, you will get decent interest rates. Very often, students and recently divorced or widowed women who had been having a joint account with their husbands now face serious problems because of having a bad credit history. Follow the tips below to establish good credit.
Check with your local bank or dept. store if they report your accounts to the credit bureaus. If they do, then you may apply for a small loan or a credit card from them. Make sure that you are regular in your monthly payments and they are reporting it to the credit bureaus. This will help in improving your credit scores. It is of no use if you take a loan or a credit card from them and they do not report to the credit bureau. Opt for a loan with terms that can be satisfied without too much of financial strain. You will easily get approved for a loan if you are ready to make larger down payment. Certain credit cards come with lower annual percentage rates. Understand the terms and conditions that apply to your account before obtaining one. Applying for a lot of credit cards in a short span of time and then not able to make timely payments will be hurting towards your credit scores because the lenders may decide you incapable of meeting all the requirements. Hence you should be careful enough before choosing the credit cards.
If you want to qualify for credit without a co-signor, you have to be above 18 years of age and have a source of steady income. You may apply for a gas card which is relatively easy to avail for the purpose of establishing good credit. Make sure that you are making regular and timely payments because your creditor is going to report your repayment history to the credit bureaus and it will have a direct effect on your credit scores.
If you are having difficulties in obtaining a loan, departmental credit card or a gas card, try to get a co-signor. Then, be regular in your monthly payments. Just in case, if you have started to miss your monthly payments to your previous creditors, enroll into a debt consolidation program before it gets too late and starts hurting your scores. You will be able to take care of a severe damage to your credit scores in time.
Lenders will give you a lot of respect if you have a checking or a saving account.
Your chances of getting approved for a loan will be less if you have overdrawn accounts. Potential lenders regard bouncing checks as a reflection of the incompetent management of financial affairs.
Apart from having a good credit history, potential lenders also look at your jobs and relocate. Being the owner of an apartment or having a telephone number in your name certainly helps in establishing a good credit history.
While you are trying every possible ways to improve your credit scores, get a secured credit card at a higher interest rate after depositing an amount. Make sure that you are making timely payments and that it is getting report to the credit bureaus.
Posted in Credit, Finance | 3 Comments »
Wednesday, July 16th, 2008
Credit card industry has their boom period between November through February. This is the time when almost every credit card company is going to offer a variety of offers to attract plenty of consumers. They will use new strategies, different advertising campaigns to target the new customers, not to forget their existing customers on the roll.
A lot of people prefer to do a balance transfer option during this period. You can easily get a check that offers 0% interest. If this is not happening, then you always have the option to put the balance on to another card at a decent interest rate between 3.99% to 6% and no balance transfer fees incurred. You may get a good deal from the various options depending upon what you have decided to do.
Here is an example to show how this balance transfer sounds to be beneficial. If you were to use a balance transfer check with 3.99% interest and a fee of 3% of your total amount to pay off a credit card or loan with 11% interest rate, you are always going to save more money if the borrowed amount is higher. With the lower interest rate on the balance transfer, your monthly payments will mostly go towards the principal amount since the interest rate is much lower than the previous loan at highest interest rate. Make sure that you are doing the payments on time otherwise you will end up falling into the same debt trap as you were in.
Balance transfer checks are easily available to the consumers at low or no interest rates. Once you have got the balance transfer check deposited into your checking account, you can easily pay all your other debts that are costing you more money just in highest interest rates.
You can create some investments for your future by using the balance transfer check. Use the amount of your balance transfer check to pay the existing debts and the rest of the money saved can be used for creating investment.
Other good deals that you can get from the low or no interest balance transfer check is the buy now, pay later holiday package. Who does not love to go out for a vacation?? Deposit the balance transfer check into your checking account and you can easily use that money to finance your holiday package. Most of the companies will offer you a zero percent interest rate, then you cannot ask for anything better, otherwise you would have done the same purchase by your credit card at higher interest rate. By putting the balance transfer check into your checking account, you are not only saving your money on interests, but you get additional time to pay back. This means that you are not putting too much strain on your wallet.
Just make sure that you are regular in your monthly payments in the balance transfer scheme. The moment you default in your payments, you won’t be able to avail the 0 % or low interest rate on the balance transfer. You not only lose this good opportunity but your repayments will add up with highest interest rates and fees.
Posted in Finance | 6 Comments »