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Follow our 200K journey to get out of debt! We share our best money tips to get out of debt and build wealth.

Monday, July 1, 2013

Heading Towards Third To Payoff Debt

Now that we've returned to telling our journey to payoff debt, it's been decided that a new format will be followed. The format will now be similar to Blogging Away Debt or $12 a Day, but from a guys perspective. This doesn't mean that the female side won't crop up from time to time, but for now let's hear it for the boy.

We're heading towards third with just a year and a half to go until we've paid off the majority of our massive debt. Part of me is excited and the other half feels like we're not going to make it.

If we were at the same point we'll be at this time next year I would feel a whole lot better. Mainly because we would be just six months away from this nightmare to be over, but right now I feel we've made some errors that are going to make things tighter than ever. One of these errors or technically two of these errors was buying new cars too soon.

Even though there is an emergency fund, I just hate cutting things so close. At times I feel we need a mountain of money to feel secure, but we've come so far without a hitch that I must maintain my faith that we will see this too the end. We'll make it, won't we?

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Tuesday, June 25, 2013

Coming Back To Tell Our Financial Success Story

It has been quite sometime since we've done a post here at Financial Elite. Not because we gave up on our finances or failed on our journey to payoff over $200,000 in debt, which does not include our homes, but we've been busy with life in general.

We are now 3 and a half years into paying off our massive debt that mainly consisted of credit cards. During these past three plus years we have paid off or eliminated over $150,000 of that debt. We have also put back on more debt by buying new cars, but we'll be back to discussing the ups and downs of our financial decisions, whether they are good or bad, and the toll it has put on our marriage.

We are now more into this journey than not with the remaining $36,000 of debt to repay from the original amount of $200,000. The payments on that amount equate too over $2,000 a month and we look forward to the $2,000 a  month pay raise we will receive when we pay that off a year and a half from now.

Join us for the remainder of this journey and let's wrap this debt thing up for good already. Thanks for following.

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Monday, October 10, 2011

Clinton Gets How to Fix the Mortgage Mess, Why Doesn't Obama?

Too bad we can't re-elect President Clinton because he has some idea's I think will help start turning our mortgage mess around. In an interview with Fortune managing editor Andy Serwer, President Clinton discusses what he would do fix the mortgage market.

I cannot emphasize the boost I think it would give the economy if we had a system that said to people whose homes are worth less than the mortgages that you can write down your mortgages to the value of your home if you can make the payment. Or you can extend the mortgage out and lower the interest rate. I don't think we ought to keep dumping these houses on the market when it's so depressed. Can we get the votes to do it? I don't know. When the Tea Party started, they seemed to object to the bailout of the big banks, claiming they were being protected from their own mistakes. That was true, but irrelevant. If a financial collapse had happened, we would have all paid. Now a lot of people argue that you shouldn't rewrite these mortgages because people never should have taken them out in the first place. There's a big problem with that thinking. The market is so depressed that it's hurting everyone else.

He hits it right out of the park. We're past the point of people loosing their homes because they took out loans that they shouldn't have. We are now facing homeowners just walking away because they are paying for something that isn't worth what they're paying for it. Is a McDonald's McDouble worth $1? Sure, but would you pay $30 dollars for one? Probably not and McDonald's would be out of business. Start making homeowners feel like they are getting there money's worth and have a feeling of wealth and things will turn around.

There are all these options and I don't think we ought to keep dumping these houses on the market right now when it's so depressed. I'd like to see them converted into rental property in an aggressive, comprehensive way, and let people rent it for the price of the utilities, the taxes, and the maintenance, just to maintain the housing stock. Then as the economy picks up, you can put it back on the market in a way that will support economic growth, not undermine it. That's what I think should be done.And in a larger sense, the market is so depressed that it's hurting everyone else. It used to be as a rule of thumb, people would say, well, if the mortgage is foreclosed on your block, it will drive down the value of your house because it's on your block, by 10, 15, 20%.But now there are so many houses that have been foreclosed on, it's driven down the value of almost everybody's houses, except -- let's talk about the upside -- the people that are in the prosperity centers of America: in Silicon Valley, in San Diego, in Orlando, and places where the economy is booming. Except for those places, this is a problem.I can't -- I think it would really get us going in a hurry if we could flush this out

Another great idea. Keep people in their homes, instead of dumping these unlived in, unkept homes on the market and driving property values down further is the way to go.

We must stop home prices from falling any further and keep homeowners in their homes. This is the only way we are going to claw our way out of this economic disaster.

(via CNN)

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Sunday, May 15, 2011

Where Has Financial Elite Gone?

We're still here, but have been extremely busy. There has also been some thought of changing the direction of the blog and discuss just how the Financial Elite have an effect on our very financial lives. Stay tuned to what happens next.

In the meantime, so far this year we have paid down additional $12,000 of debt and our debt snowball is about to really get rolling as we will be paying off our first two credit cards in July. After that we'll start applying the money that was going towards the paid off cards and put it towards the next card in line.

We're happy how fast the year is going. Not that we are wishing our lives away, but this time next year we will have at least three credit cards paid off and will have made the last of our car payments. At that time our snowball will be huge and we can knock each debt out right after the other.

Good things are here and more to come soon.

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Tuesday, April 19, 2011

Civil War Coming from Declined Loan Modifications

I received a call today from a long time friend of mine, who is in the process of having his families home sold due to the on going Great Recession, and was not happy. Why you ask? Because the whole loan modification program is a joke.

So, let me back track a little with my friends situation. About a year ago my friends financial house of cards had collapsed. Because of his income decreasing he was charging excessively to continue to keep his household going and make his mortgage payments, but eventually he had reached his max. Credit cards maxed out and a continuing declining income situation had him and his wife considering bankruptcy. They decided against this option and instead settled on their credit cards. While during this settlement process, they also started looking into getting a loan modification. A year later and a long story short, they were declined for the loan mod. Well, not really, but they might as well have been.

My friend eventually lost his job and was offered a loan modification from Freddie Mac (Chase is the servicer of the loan). You might be thinking well, what's wrong with that? The thing that is wrong with that is, his unemployment is $1,400 a month, but Freddie Mac offered him a payment of $1,600. That's better than nothing, but $200 over his total monthly income. So, of course, they declined the offer.

They then were offered a short sale and began the process of putting the house up for sale. The good news is the house sold quickly. They other good news is they qualified for HAFA. Under HAFA you may qualify to get back $3,000 from the sale of your home for moving expenses. Today they learned they didn't qualify.

To be eligible for HAFA, homeowners must first apply for a loan modification through the Home Affordable Modification Program, or HAMP. Owners who do not qualify for a loan modification or miss payments during the initial loan modification period qualify for HAFA. Hence, Freddie MAc declined to pay the $3,000 for moving expenses. My thinking is they weren't actually denied a modification. They were offered it, but the declined the offer. In reality they probably should have taken the the deal and then defaulted again on the re-structured loan.

My friend went on to say he couldn't believe someone has not gone into a bank and started shooting it up. I am in no way condoning this behavior, but it seems like more people have been killed themselves over losing their home then taking others out with them.

I continue to hear more and more about unsuccessful loan work outs and there seems to be a common denominator and that seems to be Freddie Mac. As I have learned that not all loan mods are created equal and there is definitely a difference when it comes down to Fannie and Freddie Mac, with Fannie being the more easy going parent than Freddie. People may not go around shooting up banks, but I feel if there isn't something done soon to turn this mess around, there will be a revolt on a civil war scale.

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