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.
Showing posts with label credit cards. Show all posts
Showing posts with label credit cards. Show all posts
Sunday, May 15, 2011
Sunday, March 6, 2011
20 Ways to Find Money Now
While working on the grocery portion of our budget, we had determined that we were buying too much milk every week. It would either go to waste or we were guzzling it down before it went bad. So, we decided to to buy a gallon less every week. By doing this we save $3 a week. You might say," Wow! A whole three dollars." But, actually that adds up to be $12 a month. Now imagine finding ten ways to cut back $3 a week. That would add up to $120 a month. Would $120 a month make a difference in your life?
Here's 20 quick ways to raise or save cash fast:
- Sell your investments.
- Sell assets, like a boat, coin collection, second car, the previously mentioned jewelry, etc.
- Seek a reduction in your child support obligations.
- Use your tax refund or alimony payment.
- Transfer your credit card balances to a card with a low interest rate. (I am putting a ban on credit cards and it may be hard to get a card these days, but give it a shot).
- If your credit card company charges an annual fee see if you can get it waived.
- Get rid of overdraft protection on your bank accounts. This just gives you a reason to overdraw your account.
- Destroy any checks you are given by your credit card company. Interest on cash advance checks will make it harder to pay off your debt.
- Always make ATM withdrawals at your banks ATM. Making withdrawals at other banks we cause you to pay additional fees.
- This one CAN hurt your your credit score, but if you are tempted to spend more than you make, canceling your credit cards may be the way to go.
- Increase the number of dependents you claim on your W-2 forms (Watch out! This could cause you to owe on your taxes at the end of the year).
- Learn how to start a budget and stay with it.
- See if you qualify for assistance from a local food bank or other charity.
- Keep your extra cash in a money market where you can earn extra interest.
- Apply for public assistance if you lose your job or are disabled. This money may not be enough to pay all your expenses, but it will at least put food on your table.
- Do not take cash advances on your credit cards. This is just a high interest loan.
- Raise the deductible on you car insurance or reduce the amount of coverage you have.
- Block texting on you cell phone. Texting can really add to your cell phone bill.
- Cancel your cable service, or reduce the number of premium channels you pay for.
- Sell things on Ebay or on Craigslist.
(photo via The Smarter Wallet)
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Sunday, February 27, 2011
Make Sure You Qualify for a Mortgage Modification Before You Try to Get One
Like us, many people are stuck in the middle of a mortgage modification mess. The Obama Administration's program to help financially stressed homeowners reduce their mortgage payments is a dud. I am still in utter disbelief that, whether your mortgage is with Fannie Mae and Freddie Mac or if you have a FHA or conventional loan, can make a difference whether you are approved for a loan modification or not.
The House GOP wants to end "failed and ineffective" housing programs, such as the Home Affordable Modification Program (HAMP), the Neighborhood Stabilization Program, the Federal Housing Administration Refinance Programs and the Emergency Homeowner Relief Fund.
Here are seven main points of supposedly what you need to qualify for a loan modification:
If you are planning to try and get financial help and apply for a mortgage modification with your bank, be sure that you are ready for the worst. Here is what you should be prepared for:
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The House GOP wants to end "failed and ineffective" housing programs, such as the Home Affordable Modification Program (HAMP), the Neighborhood Stabilization Program, the Federal Housing Administration Refinance Programs and the Emergency Homeowner Relief Fund.
"In an era of record-breaking deficits, it's time to pull the plug on these programs that are actually doing more harm than good for struggling homeowners," Rep. Spencer Bachus, an Alabama Republican who chairs the House Financial Services Committee, said in a statement."While these programs are not gone yet, I think Bachus is completely correct. Just over a third of households enrolled in a trial loan modification through the Home Affordable Modification Program (HAMP) have been given a permanent modification. This was as of November 2010 and until June 2010, banks were still enrolling homeowners in trial modifications without verifying whether they qualified or not. So, you may have been given false hope that you qualify only to find out months later that you were turned down.
Here are seven main points of supposedly what you need to qualify for a loan modification:
- Your loan must be less than $729,750.
- You must live in the property. (Investment properties are not allowed. However, I was able to get a mortgage modification on my investment property.) Odd very odd. Sounds fishy to me.
- You will have to fully document your income. You will have to provide your most recent tax returns and your two most current pay stubs. Have your bank statements ready while your at it too.
- You must have received your original mortgage before January 1, 2009.
- You will have to sign an affidavit financial hardship.
- The total payment on your mortgage including principal, interest, taxes, insurance and homeowners association dues (HOAs) must exceed 31% of your current gross income.
- If your total household debt, which includes loans, credit cards, and alimony payments, total more tan 55% of your income, you will have to agree to sign up for financial counseling.
If you are planning to try and get financial help and apply for a mortgage modification with your bank, be sure that you are ready for the worst. Here is what you should be prepared for:
- Your credit score will drop. Even if you are offered a trial modification, the lesser amount that you are now paying on the mortgage during the trial will be reporting to the credit bureaus.
- It may take three months or more (In our case fourteen months and counting) to know if you were approved or not. HAMP's original goal was to give homeowners a three month trial period. However, the more people I talk to more I keep hearing six months, a year or even two years, before getting an answer. Hold on this could be a bumpy ride.
- Making timely payments during the trial does not guarantee you will receive a permanent modification. See the 7 points discussed above. I am now suggesting that you know the bank's criteria for eligibility before you attempt to get a modification.
- Be ready. If you are turned down for the permanent modification, the bank will make due the difference you haven't been paying between the normal payment and your trial period payment for every month you were not making a regular payment. If you cannot pay the back payments, which could be 12 or even 24 months worth, you will most likely be facing foreclosure. If you are going to attempt a modification you need to put aside the difference in savings or will most likely lose your home.
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Wednesday, February 23, 2011
Mortgage Modification Madness
A recent report from the nation's mortgage bankers revealed that mortgage delinquency rates have fallen to the lowest level since the end of 2007, which was the beginning of the recession, but we are still not one of the homeowners who are making payments on their mortgage again.
I received an email today from our mortgage negotiator, who once again told me that there was nothing she could do to help us, but that she would review the file with management and try and find a solution. The primary problem is Bank of America wants us to settle on our business credit cards that were charged off with them. The other being of course, that our loan is with Freddie Mac. Unlike our investment property, which is with Fannie Mae, and with which we received a loan modification with the greatest of ease.
I was recently reading an article in "O The Oprah Magazine," yeah, whatever, I read "O," where Suze Orman worked with a couple that had a similar situation to ours. In the article, the couple had debt payments and a mortgage payment very close to our own. They had a mortgage payment of $2,641 and monthly debt payments of $2,475. Now these are not an exact match to our own debts, but the average is pretty darn close.
The couple was put on a trial payments and waited 14 months for an answer for approval of a loan modification, but were ultimately declined. The bank then wanted the couple to pay the back payments and difference between the modification trial payments and their regular payments. The couple could not afford to make the back payments and now face foreclosure. Does the couple have any hope of saving their home?
Here is the 6 point action plan that Suze recommended for the couple:
Our debt snowball is about begin with the first of our debts to be paid off in just the next few months. After that, by this time next year we will have paid down at least another $25,000 in credit card debt and have several more accounts and loans paid off. At that time we will have an extra $1,000 a month available to us to either easily pay our mortgage or put more towards our debt and speed up our five year balance liquidation plan. I only hope we can hold on another ten months, but I am begging to feel like our time is running out.
(Via O The Oprah Magazine March 2011)
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I received an email today from our mortgage negotiator, who once again told me that there was nothing she could do to help us, but that she would review the file with management and try and find a solution. The primary problem is Bank of America wants us to settle on our business credit cards that were charged off with them. The other being of course, that our loan is with Freddie Mac. Unlike our investment property, which is with Fannie Mae, and with which we received a loan modification with the greatest of ease.
I was recently reading an article in "O The Oprah Magazine," yeah, whatever, I read "O," where Suze Orman worked with a couple that had a similar situation to ours. In the article, the couple had debt payments and a mortgage payment very close to our own. They had a mortgage payment of $2,641 and monthly debt payments of $2,475. Now these are not an exact match to our own debts, but the average is pretty darn close.
The couple was put on a trial payments and waited 14 months for an answer for approval of a loan modification, but were ultimately declined. The bank then wanted the couple to pay the back payments and difference between the modification trial payments and their regular payments. The couple could not afford to make the back payments and now face foreclosure. Does the couple have any hope of saving their home?
Here is the 6 point action plan that Suze recommended for the couple:
- Don't pay the mortgage. Suze recommended, since the bank is foreclosing, that the couple stop paying the mortgage. However, she said the money they were paying monthly on their trial modification needs to be put into savings. It could be two months, six months, or even longer before they actually need to move out of their home and they should save as much as they can.
- Do pay back the credit card companies. Since they have not missed credit card payments it was the best way to raise their credit scores.
- Scale back. Find even more ways to save money. The couple was paying a combined $250 on their cell phones, landline, and cable. She suggested they get that combined total down to $100. She also recommended they reduce their eating out budget and taking no vacations.
- Get more protection. The couple already had term life insurance, but not even close to half of the $1,000,000 each she thought they should have. She feels they both could get coverage for less than $100.
- Focus on saving. The couple needed to take the extra money they were saving once they moved to create their 8 month emergency fund. After that they needed to get going on their retirement.
- Accentuate the positive. Even though they were losing their home they had to look at the money they would be saving as the beginning of building a brighter future.
Our debt snowball is about begin with the first of our debts to be paid off in just the next few months. After that, by this time next year we will have paid down at least another $25,000 in credit card debt and have several more accounts and loans paid off. At that time we will have an extra $1,000 a month available to us to either easily pay our mortgage or put more towards our debt and speed up our five year balance liquidation plan. I only hope we can hold on another ten months, but I am begging to feel like our time is running out.
(Via O The Oprah Magazine March 2011)
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Monday, February 21, 2011
6 Ways to Help Grow a Business
Just like many businesses these days ours has suffered just like the rest. A good portion of the six figures of debt we have is from keeping our business afloat.
Like so many other aspects of our finances, we have been experiencing improvement with our business as well. However, we are no where near to our pre-recession sales. Just as we have been diligently chipping away at our credit card debt, we are working on getting our business booming again. Here are our six ways we plan to do it:
Like so many other aspects of our finances, we have been experiencing improvement with our business as well. However, we are no where near to our pre-recession sales. Just as we have been diligently chipping away at our credit card debt, we are working on getting our business booming again. Here are our six ways we plan to do it:
- Getting an Edge - We have been looking at what our biggest cost and time constraints are and working on improving those areas. We have already re-wrote our lease payments and lowered our phone and computer costs.
- Own Your Tag Line - Check Google and see if anyone else uses or owns your tag line.
- Hyperfocus - Focus on an area in your business. We want to focus on our Google ranking, but you can work on cutting cost or turning your sales faster, whatever you choose, work on it for 90 days straight.
- Write - Use media like Twitter, YouTube videos, blogs, and Facebook.
- Control Your Spending - Growing costs money. Stay focussed and look for ways to fuel growth without using outside capital. Watch your cash position daily.
- Pulse Faster - Executive teams of the most successful companies huddle daily. If anything, discuss these 6 steps in your meeting to create a habit.
Friday, February 18, 2011
Hello...Bank of America. Can You Hear Me?
As suggested by our loan modification negotiator I contacted Bank of America's business card department to attempt to get a settlement on our charged off credit cards, which was not very successful.
The bank was more than happy to settle on these cards, but with payments that were not affordable. We have two business cards one with a charged off balance of over $40,000 and another of over $10,000. The settlement offer was for 3 payments of a combined total of $6,000. Another alternative was to pay back the entire balances and make payments of a combined total of almost $1,000 a month for five years. This is basically the same balance liquidation programs our personal credit cards are on.
It's not that we don't want to pay what we owe on these cards and we will after we finish paying our other debts, but there is no way we can pay these amounts. Even the payment reduction plan is out of reach once we started paying our mortgage again.
So, I emailed our negotiator and let her now what has happened. She has always been fairly quick to respond back to me, but not this time. She could have been too busy or just didn't feel like telling me, "Well, there is nothing more we can do than."
I probably won't hear anything for sure now until Tuesday. But Bank of America I warn you. If you don't approve this loan modification because we owe you other money, you will awaken a sleeping giant, who will strike back with a force you have yet to reckon with.
The fact that we are denied because payments are being added to our debt that have been charged off and are not being paid is ridiculous. That you tell me because our loan is with Freddie Mac is a problem as well and that all loan mods are not created equal is outrageous. That you gave us a loan modification on our rental property over our primary residence is absurd.
The public must be made aware of the inconsistencies with the banks and the whole loan modification process and I might just be the guy to do it.
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The bank was more than happy to settle on these cards, but with payments that were not affordable. We have two business cards one with a charged off balance of over $40,000 and another of over $10,000. The settlement offer was for 3 payments of a combined total of $6,000. Another alternative was to pay back the entire balances and make payments of a combined total of almost $1,000 a month for five years. This is basically the same balance liquidation programs our personal credit cards are on.
It's not that we don't want to pay what we owe on these cards and we will after we finish paying our other debts, but there is no way we can pay these amounts. Even the payment reduction plan is out of reach once we started paying our mortgage again.
So, I emailed our negotiator and let her now what has happened. She has always been fairly quick to respond back to me, but not this time. She could have been too busy or just didn't feel like telling me, "Well, there is nothing more we can do than."
I probably won't hear anything for sure now until Tuesday. But Bank of America I warn you. If you don't approve this loan modification because we owe you other money, you will awaken a sleeping giant, who will strike back with a force you have yet to reckon with.
The fact that we are denied because payments are being added to our debt that have been charged off and are not being paid is ridiculous. That you tell me because our loan is with Freddie Mac is a problem as well and that all loan mods are not created equal is outrageous. That you gave us a loan modification on our rental property over our primary residence is absurd.
The public must be made aware of the inconsistencies with the banks and the whole loan modification process and I might just be the guy to do it.
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Wednesday, February 16, 2011
Never Give Up Trying to Get a Loan Modification
As suggested, I contacted Bank of America's credit card department, which is the same bank that holds our mortgage to see if we could reach a settlement on our business credit cards. They took down all our financial information to see what we could work out. One thing that I thought was cool was the representative looked to see if we could adjust our payments any further on our personal credit cards. These cards were all previously placed on a balance liquidation program, but any additional help we may be able to get is worth a try. However, he really couldn't help with our business cards either.
He had to transfer us to the business credit card division, which happened to be closed by the time I had called. So, no answer today on whether we will be able to settle on those cards and see if removing those debts from our debt to income calculations will bring us down to an acceptable amount to get approved for the loan mod.
One other interesting note is the credit card rep knew about our attempt to obtain a loan modification already. This may help or hinder us. Will they say, "Ok, lets give these folks a hand" or " These guys most really be desperate. lets sock it to them." We'll just have to wait and see what unfolds. Tomorrow is another day.
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He had to transfer us to the business credit card division, which happened to be closed by the time I had called. So, no answer today on whether we will be able to settle on those cards and see if removing those debts from our debt to income calculations will bring us down to an acceptable amount to get approved for the loan mod.
One other interesting note is the credit card rep knew about our attempt to obtain a loan modification already. This may help or hinder us. Will they say, "Ok, lets give these folks a hand" or " These guys most really be desperate. lets sock it to them." We'll just have to wait and see what unfolds. Tomorrow is another day.
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Tuesday, February 15, 2011
Bang Your Head...Getting a Loan Modification Can Drive You Mad
Day 411 of My Financial Freedom Countdown
As expected we heard back from our lead negotiator today and didn't receive the news we had hoped for. The bank is not budging on the business debt we have charged off with them. With that debt, which we do not pay a dime towards currently, we do not qualify for a loan modification.
It was suggested to us by the negotiator to call the card services department and see if we can work out a settlement. I am fine with this. Especially, since we may be looking at a law suit sooner or latter regarding the charge off and that would really put us in a pickle. So in some ways this may get that monkey off our back and at the same time finally qualify us for a loan mod.
I will be calling the credit card department tomorrow to see what we can do. We were offered settlements before, which were not workable at the time, but now may be doable. I am hoping that they offer us a similar offer as before or maybe even better. The only concern I have is next year at tax time. If they send us a 1099c we could very well owe some money to the IRS. Have I told anyone how much I hate debt?
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).] Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
As expected we heard back from our lead negotiator today and didn't receive the news we had hoped for. The bank is not budging on the business debt we have charged off with them. With that debt, which we do not pay a dime towards currently, we do not qualify for a loan modification.
It was suggested to us by the negotiator to call the card services department and see if we can work out a settlement. I am fine with this. Especially, since we may be looking at a law suit sooner or latter regarding the charge off and that would really put us in a pickle. So in some ways this may get that monkey off our back and at the same time finally qualify us for a loan mod.
I will be calling the credit card department tomorrow to see what we can do. We were offered settlements before, which were not workable at the time, but now may be doable. I am hoping that they offer us a similar offer as before or maybe even better. The only concern I have is next year at tax time. If they send us a 1099c we could very well owe some money to the IRS. Have I told anyone how much I hate debt?
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).] Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
Getting a Loan Modification Can be Such a Drag
Day 410 of My Financial Freedom Countdown
We are going into our 13th month of attempting to get a loan modification on our primary residence. Again we were declined because we have a business card charged off with the same bank that services our mortgage. So it looks like this will be continuing to drag on for God knows how long.
If this charge off was with another institution this would not even be a question or if the loan was held with Fannie Mae rather than Freddie Mac. All loan mods are not considered equal as it may seem. We were able to get a mod on our rental property with the greatest of ease because that loan was with Fannie Mae. Because the primary residence is with Freddie Mac we're a no go. Fannie does not look at outstanding debt while Freddie does.
Even though one looks at debt and the other doesn't, why is the bank throwing the charge off in our face? It doesn't make sense to me and seems like it is just another excuse. We have already called the president of the mortgage division's office, which we have been receiving call backs, but that does nothing because we are back at step one anyway. We did however receive another call today form a new negotiator. We will be calling him tomorrow to see what he has to say.
I am thinking our next step is to contact our state senator, who is Harry Reid, and discuss this travesty. The fact that all loan mods, regardless of investor or loan program, are not the same is outrageous. There is also not much out there laying out this type of scenario. The public needs to be made aware of this, as I don't feel that this information is public knowledge. Am I to be the guy who has to start a crusade to get this fixed? Even if we do not get a loan mod in the end something needs to be done about this.
My wife did find one bit of hope out there. According to Freddie Mac, if the borrowers debt is greater than 55%, the borrower must take a free debt counseling course in order to qualify. This may be our saving grace as this as yet to be offered to us as an option. We'll have to see what this new negotiator has to say, but I feel a war coming on.
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).] Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
We are going into our 13th month of attempting to get a loan modification on our primary residence. Again we were declined because we have a business card charged off with the same bank that services our mortgage. So it looks like this will be continuing to drag on for God knows how long.
If this charge off was with another institution this would not even be a question or if the loan was held with Fannie Mae rather than Freddie Mac. All loan mods are not considered equal as it may seem. We were able to get a mod on our rental property with the greatest of ease because that loan was with Fannie Mae. Because the primary residence is with Freddie Mac we're a no go. Fannie does not look at outstanding debt while Freddie does.
Even though one looks at debt and the other doesn't, why is the bank throwing the charge off in our face? It doesn't make sense to me and seems like it is just another excuse. We have already called the president of the mortgage division's office, which we have been receiving call backs, but that does nothing because we are back at step one anyway. We did however receive another call today form a new negotiator. We will be calling him tomorrow to see what he has to say.
I am thinking our next step is to contact our state senator, who is Harry Reid, and discuss this travesty. The fact that all loan mods, regardless of investor or loan program, are not the same is outrageous. There is also not much out there laying out this type of scenario. The public needs to be made aware of this, as I don't feel that this information is public knowledge. Am I to be the guy who has to start a crusade to get this fixed? Even if we do not get a loan mod in the end something needs to be done about this.
My wife did find one bit of hope out there. According to Freddie Mac, if the borrowers debt is greater than 55%, the borrower must take a free debt counseling course in order to qualify. This may be our saving grace as this as yet to be offered to us as an option. We'll have to see what this new negotiator has to say, but I feel a war coming on.
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).] Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
Thursday, February 3, 2011
What Good Are Credit Cards If They Only Lead to Trouble?
Credit cards are not bad, but you do need to have some self control. However, credit cards can provide some false financial security. They can be used as an emergency fund if your car breaks down, but a real cash emergency fund is the best policy. If you can't afford to put money aside to start an emergency fund, what makes you think you can make the credit card payments if you use the card for an emergency. A credit card company can serve as a middleman if you have a dispute with a merchant and you can use to make purchases over the phone or on the Internet (hotel room, airline tickets, etc.). But you can also get the same services and do the same things just as easily with a debit card. If you are going to absolutely use a credit card be sure you can pay the balance in full each month. Long term debt has no business on your credit card.
So, to answer the question, what good are credit cards if they only lead to trouble? Nothing really. You don't need them.
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).] Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
So, to answer the question, what good are credit cards if they only lead to trouble? Nothing really. You don't need them.
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).] Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
Tuesday, February 1, 2011
What are Some Warnings Signs That I Have Too Much Debt?
Inappropriate use of credit can be a huge financial pitfall for anyone.
Do determine if you have a a financial management and debt problem, see if the following warning signs apply to you:
Do determine if you have a a financial management and debt problem, see if the following warning signs apply to you:
- You are consistently receiving past due notices from your creditors and on other bills.
- You are charging more on your credit cards then what you make each month.
- You are unable to save at least ten percent of your pay each month.
- You are unable to pay your credit cards in full each month and it takes longer and longer to pay down your debt.
- You have to juggle your payments or stall creditors so you can pay another.
Thursday, January 27, 2011
What are Some Painless Ways I Can Save More Money?
People usually have no problem spending money, but saving money is a whole different story. It's kind of like when you want to lose weight, but just like there are ways to cut back on calories, there are a few things you can do to make saving money relatively painless.
- Whenever you get a raise, deposit the extra money you make directly into your savings account so you don't miss it. It is very tempting to spend the extra money, but don't give yourself a chance to spend it. Set yourself up on direct deposit right away and have the amount of your raise put away.
- Brown bag your lunch. Taking your lunch to work instead of eating out will save you anywhere from $5 to $10 a day. That could be a $100 or more a month.
- If you don't have debt, put your tax return in your savings account. However, if you do have debt, slap that refund down on your credit cards.
- Deposit any overtime pay, bonus or part-time job money into your saving account.
- Pay cash for everything. You will spend less if you pay cash over using your debit or credit cards. It hurts to spend cash. Swiping plastic doesn't. Ditch the cards.
- Put in your budget a savings plan for big purchase items like a new car. The more you put down the less your payment will be. Not to mention the money you will save in interest. Even better, save enough money to pay cash for your car.
Tuesday, January 4, 2011
Looking Forward to Less Debt 2011
Sorry it's been awhile, but here's a quick post to say hello to 2011. Last year was a fantastic year with us paying off over $20,000 in debt. More details with exact figures coming soon.
The balance liquidation programs and loan modifications, well at least one so far, are working well. I look forward to paying off an additional $20,000 if not more in 2011. If you haven't made paying off your debt a New Year's resolution, you need to get on it.
Christmas was great and we bought all our gifts with cash only. Not using our credit cards last year was scary at first, but really you don't need them. CASH is the best policy.
So here's looking to an awesome 2011. Let's payoff some debt.
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).] Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
The balance liquidation programs and loan modifications, well at least one so far, are working well. I look forward to paying off an additional $20,000 if not more in 2011. If you haven't made paying off your debt a New Year's resolution, you need to get on it.
Christmas was great and we bought all our gifts with cash only. Not using our credit cards last year was scary at first, but really you don't need them. CASH is the best policy.
So here's looking to an awesome 2011. Let's payoff some debt.
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).] Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
Friday, December 3, 2010
Should I Really Cut Up All of My Credit Cards?
I know you are thinking, "I can't survive with out my credit cards." Having a credit card can be addictive, but if you are in debt, they need to go. You can do it. You don't necessarily need to close your cards, but leave them open. Closing your cards can hurt your credit score.
photo via (achildgrows)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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Sunday, November 21, 2010
Bad at Blogging...But Great at Paying Off Debt
Day 325 of my Financial Freedom Countdown
My blog posts have fallen tremendously. Going from posting virtually everyday to posting once a week on Sunday's. I don't intend for this to continue this way forever and as things balance out a little a will get back to my regular posting. The thing is I am really busy right now and I mean really busy. Not only because of the holidays, but as in business. The kind of business I had before the recession. The busy that makes me a lot of money and also will help speed up my five year credit card balance liquidation plan.
Couple of things have happened the past couple of weeks and one of them is our production has picked up. It would seem people are starting to get confident and are beginning to start spending money again. We'll see if this lasts, but for now any excess funds coming in up and above what is in the realm of our normal budget is going towards debt. I expect to be able to start reporting on paying off and bringing several credit card accounts to a zero balance real soon. If things continue going the way they are that is. I think what is happening right now will continue on until at least January, but it feels like it could go on forever or at least until the next economic crisis, but who knows? We'll see.
Something else that happened this week was I pulled my credit report from https://www.annualcreditreport.com/. You are able to get a free copy of your credit card each year from the three major credit bureaus. I have learned from Blogging Away Debt that I should do this every quarter and will begin doing this more regularly now. This time around I chose Equifax for my free report and this is the first time I have pulled my credit report since my financial crisis began a couple of years ago.
I was glad to find that nothing out of the ordinary was happening, such as identity theft, and my balances were finally beginning to come down significantly. Many readers ask me, "How much debt do actually have?" I have well over six figures of debt and I have been meaning to post a page following my progress and I will do that soon. However, for now, here is an idea what my debt looks like 2010 comes to a close:
Car loan $15,960
Visa $4,829
Visa $767
Visa $13,890
Master Card $21,899
Visa $15,112
Master Card $12,752
Visa $18,164
Medical Account $3,552
Credit Line $9,590
Home improvement Loan $4,013
Personal Loan $17,078.85
Personal Loan $2,626.11
loan from parent $2,500
Grand ugly total $142,732.96
Just think this was even worse at the beginning of 2010. We have paid off a good $20,000 plus so far this year and I feel we will really begin our debt snowball real soon. This debt does not include our business debt nor our mortgages, so it is even uglier. I really do feel the best is yet to come and we are going to get this licked in three years instead of five. Just watch.
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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Couple of things have happened the past couple of weeks and one of them is our production has picked up. It would seem people are starting to get confident and are beginning to start spending money again. We'll see if this lasts, but for now any excess funds coming in up and above what is in the realm of our normal budget is going towards debt. I expect to be able to start reporting on paying off and bringing several credit card accounts to a zero balance real soon. If things continue going the way they are that is. I think what is happening right now will continue on until at least January, but it feels like it could go on forever or at least until the next economic crisis, but who knows? We'll see.
Something else that happened this week was I pulled my credit report from https://www.annualcreditreport.com/. You are able to get a free copy of your credit card each year from the three major credit bureaus. I have learned from Blogging Away Debt that I should do this every quarter and will begin doing this more regularly now. This time around I chose Equifax for my free report and this is the first time I have pulled my credit report since my financial crisis began a couple of years ago.
I was glad to find that nothing out of the ordinary was happening, such as identity theft, and my balances were finally beginning to come down significantly. Many readers ask me, "How much debt do actually have?" I have well over six figures of debt and I have been meaning to post a page following my progress and I will do that soon. However, for now, here is an idea what my debt looks like 2010 comes to a close:
Car loan $15,960
Visa $4,829
Visa $767
Visa $13,890
Master Card $21,899
Visa $15,112
Master Card $12,752
Visa $18,164
Medical Account $3,552
Credit Line $9,590
Home improvement Loan $4,013
Personal Loan $17,078.85
Personal Loan $2,626.11
loan from parent $2,500
Grand ugly total $142,732.96
Just think this was even worse at the beginning of 2010. We have paid off a good $20,000 plus so far this year and I feel we will really begin our debt snowball real soon. This debt does not include our business debt nor our mortgages, so it is even uglier. I really do feel the best is yet to come and we are going to get this licked in three years instead of five. Just watch.
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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Monday, November 8, 2010
I am Paying Off My Debt and so is the Rest of America
Day 311 of my Financial Freedom Countdown
I have paid off over $20,000 of credit card debt this year and I am not the only one reducing my debt. Americans have paid off nearly $1 trillion in debt over the past 2 years. Total consumer debt was $11.6 trillion as of September 30; down 7.4%, or $922 billion, from the peak reached in the third quarter of 2008.
"Americans are borrowing less and paying off more debt than in the recent past. This change, which we continue to study carefully, can be a result of both tightening credit standards and voluntary changes in saving behavior." Donghoon Lee, senior economist in the Research and Statistics Group at the New York Fed Said in a statement.
"Lending practices are tight making it more difficult for people to secure more debt," said Chris Viale, president and CEO of Cambridge Credit Corp., a non profit credit counseling agency based in Agawam, Mass, "The only choice they have is paying down debt."
I am pleased to see so much debt being paid down. However, from the sounds of it, it seems that most of the debt reduction is due to cosumers being forced to by their creditors. Like me, many have had their limits reduced or credit card accounts closed through balance liquidation programs. But if you are following Dave Ramsey's plan it doesn't matter if your credit card accounts are closed. You aren't going to need them anyway. Debt snowball those balances into an oblivion!
(via CNNMoney.com)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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"Americans are borrowing less and paying off more debt than in the recent past. This change, which we continue to study carefully, can be a result of both tightening credit standards and voluntary changes in saving behavior." Donghoon Lee, senior economist in the Research and Statistics Group at the New York Fed Said in a statement.
"Lending practices are tight making it more difficult for people to secure more debt," said Chris Viale, president and CEO of Cambridge Credit Corp., a non profit credit counseling agency based in Agawam, Mass, "The only choice they have is paying down debt."
I am pleased to see so much debt being paid down. However, from the sounds of it, it seems that most of the debt reduction is due to cosumers being forced to by their creditors. Like me, many have had their limits reduced or credit card accounts closed through balance liquidation programs. But if you are following Dave Ramsey's plan it doesn't matter if your credit card accounts are closed. You aren't going to need them anyway. Debt snowball those balances into an oblivion!
(via CNNMoney.com)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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Saturday, November 6, 2010
Good Riddance Wells Fargo Financial
Day 310 of my Financial Freedom Countdown
This has just not my week for good news. I almost had a judgement filed against me, the hot water heater went out at my rental property, and the second mortgage on my investment property has been sold to another servicer before we could get a loan modification on it. So what else can happen? Two of my credit card accounts that have been paid in a timely matter have been closed.
I hadn't paid attention to the expiration date on my Wells Fargo Financial cards, but they did expire last month. Not only did they expire, but Wells Fargo Financial sent me a letter stating they were closing the accounts and not re-newing the cards.
The thing is these credit cards were the only cards that we did not have on a balance liquidation program. So we now have no available credit whatsoever. Is this a bad thing, really? Not at all. We have our emergency fund in place and now there is no way we can get into financial trouble again since all of our credit cards are now closed. One thought however...How is this going to change my credit score with no open credit lines? Credit scores? We don't need credit scores where were going.
photo via (Credit.com)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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I hadn't paid attention to the expiration date on my Wells Fargo Financial cards, but they did expire last month. Not only did they expire, but Wells Fargo Financial sent me a letter stating they were closing the accounts and not re-newing the cards.
The thing is these credit cards were the only cards that we did not have on a balance liquidation program. So we now have no available credit whatsoever. Is this a bad thing, really? Not at all. We have our emergency fund in place and now there is no way we can get into financial trouble again since all of our credit cards are now closed. One thought however...How is this going to change my credit score with no open credit lines? Credit scores? We don't need credit scores where were going.
photo via (Credit.com)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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Friday, November 5, 2010
The Second Mortgage on My Investment Property is Being Sold to Another Servicing Company
Day 309 of my Financial Freedom Countdown
Along with restructuring all our credit card debt, we have been working on getting a loan modification on our primary residence since February of this year with no avail. We have been diligently following up with everything the bank has asked for, but they keep coming back and asking for updated information or totally new requests for other items not previously asked for. The thing is it didn't take no where as long to get a loan modification on our rental property's first mortgage, but we didn't stand a chance on the second mortgage for the investment property.
We applied for a loan mod on the second mortgage the same time we did for the first mortgage on the rental. However, we were almost immediately told the second mortgage had mortgage insurance on it and it had claim against it. This was back in June and now it looks like that process is now complete.
We received a letter from our previous servicer that our loan had indeed been officially transferred and I also noticed that the loan no longer reflects on our online banking account profile. We have not been contacted by the new servicer yet, but I expect that we will hear from them very soon as I know they will want to get paid. I just hope they will want to work with us and this won't be another case of the Lord giveth and the creditor taketh away. We really want to work things out.
photo via (adversaryproceeding)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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We applied for a loan mod on the second mortgage the same time we did for the first mortgage on the rental. However, we were almost immediately told the second mortgage had mortgage insurance on it and it had claim against it. This was back in June and now it looks like that process is now complete.
We received a letter from our previous servicer that our loan had indeed been officially transferred and I also noticed that the loan no longer reflects on our online banking account profile. We have not been contacted by the new servicer yet, but I expect that we will hear from them very soon as I know they will want to get paid. I just hope they will want to work with us and this won't be another case of the Lord giveth and the creditor taketh away. We really want to work things out.
photo via (adversaryproceeding)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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Friday, October 29, 2010
The Lord Giveth and the Creditor Taketh Away
Day 302 of my Financial Freedom Countdown
I have been feeling really good about paying off our debt lately. We have been very fortunate to see an increase of business and more business means more money to pay towards debt. However, this feeling of a light at the end of tunnel is feeling threatened.
We are totally on track to be debt free in a little over four years. Thanks mostly to the balance liquidation programs we are on. But just as we are making head way and are beginning to see a way to pay extra towards our credit cards we get hit with something else...more debt.
We had a CareCredit account that we used for extra expenses when we were having infertility treatments and like many of our other credit cards we fell behind on our payments. We owed a relatively low amount compared to our other credit cards. Right around $3,000, but we ended up letting the account go, which was now a big mistake.
With the general low amount it wasn't like we really wanted to have the card charged off, we just had bigger fish to fry and actually forgot about the account. We are now faced with a big fat stupid tax fee.
CareCredit charged off the account and sold it to Persolve, LLC AKA Account Resolution Associates. Persolve ironically means "to pay in full" and pay in full and then some is indeed what we now have to do. We began getting calls from Persolve a couple of weeks ago. They finally called on an evening we were home and we took the call. It wasn't like we were hiding. We really want to get our debt paid off and work out some kind of deal.
Initially the collector was very nice and seemed to really want to help, but shortly after a few conversations he turned into a big fat part of the male anatomy. His initial discussion offered payments of $200 a month, but are now at a final offer of $300 a month. No reduction in balance, no lower payments, no nothing. He even came back with a judgement ready to be filed, which he immediately faxed to us and was about to file it. So now not only do we have to pay the $3,000 balance we once owed, we will have to a total of $4,050 in payments.
If you have an opportunity to settle with your creditor do it before it goes to some out of control collection agency. In my case I am already over $100,000 in debt, what's a few more thousand? Yeah, right. This sucks.
photo via (andebtnegotiators.mymultimedia.com)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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We are totally on track to be debt free in a little over four years. Thanks mostly to the balance liquidation programs we are on. But just as we are making head way and are beginning to see a way to pay extra towards our credit cards we get hit with something else...more debt.
We had a CareCredit account that we used for extra expenses when we were having infertility treatments and like many of our other credit cards we fell behind on our payments. We owed a relatively low amount compared to our other credit cards. Right around $3,000, but we ended up letting the account go, which was now a big mistake.
With the general low amount it wasn't like we really wanted to have the card charged off, we just had bigger fish to fry and actually forgot about the account. We are now faced with a big fat stupid tax fee.
CareCredit charged off the account and sold it to Persolve, LLC AKA Account Resolution Associates. Persolve ironically means "to pay in full" and pay in full and then some is indeed what we now have to do. We began getting calls from Persolve a couple of weeks ago. They finally called on an evening we were home and we took the call. It wasn't like we were hiding. We really want to get our debt paid off and work out some kind of deal.
Initially the collector was very nice and seemed to really want to help, but shortly after a few conversations he turned into a big fat part of the male anatomy. His initial discussion offered payments of $200 a month, but are now at a final offer of $300 a month. No reduction in balance, no lower payments, no nothing. He even came back with a judgement ready to be filed, which he immediately faxed to us and was about to file it. So now not only do we have to pay the $3,000 balance we once owed, we will have to a total of $4,050 in payments.
If you have an opportunity to settle with your creditor do it before it goes to some out of control collection agency. In my case I am already over $100,000 in debt, what's a few more thousand? Yeah, right. This sucks.
photo via (andebtnegotiators.mymultimedia.com)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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Sunday, October 24, 2010
Should I Have Cashed Out or Rolled Over My 401(K)?
Day 296 of my Financial Freedom Countdown
One of my biggest regrets during my first financial crisis is pulling money out of my 401(k). I wish I still had all the money today. However, even if I still had it, I would probably be tempted to pull it out again to pay off debt. If you are feeling the same temptation, tell Satan to get behind you right now.
Do not cash out your 401(k) unless you are retiring. One out five employed U.S. citizens have made this same mistake and now have loans against their 401(k) funds. If you make a withdrawal from your 401(k) it will result in major taxes and penalties. Most people who withdraw early end up with half as much as they originally had. I actually ended up with none.
I had at one time over $50,000 in my 401(k), but had pulled it out to pay off credit card debt. On average most American employees have $33,000 in their 401(k) at age 30. Now most financial planners would tell you that amount would turn into over $500,000 when you reach 65. Granted that you earn an average of 8-12%. So, with me having $50,000, imagine what I would have in another 30 years.
However, using the $33,000 as an example, $33,000 would end up being worth more like $18,000 after taxes and penalties. In my case, the rest of my debt had been eliminated, but my 401(k) was wiped out and I ended up paying $15,000 in income tax. Unfortunately, most people like me cash out their 401(k) when they are laid off.
If you are laid off, do everything you can to avoid the temptation of withdrawing from your 401(k). When you do go back to work, some employer 401(k) plans will allow you to re-invest your old 401(k) into your new one, but if not, you should roll your 401(k) into an IRA. I know you may busy getting adjusted on your new job and whatever else life throws at you, but you must make the roll over a priority.
Use me as an example and do not cash out your 401(k) and pay 40 percent in taxes and penalties. Do what you have must to roll it in an IRA and leave it until you retire. Fill out the roll over paperwork. Thirty minutes of your time is worth it. If not, $100,000 or more is all you have to lose. You decide.
Photo Via (401khardshipwithdrawal.com)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
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Do not cash out your 401(k) unless you are retiring. One out five employed U.S. citizens have made this same mistake and now have loans against their 401(k) funds. If you make a withdrawal from your 401(k) it will result in major taxes and penalties. Most people who withdraw early end up with half as much as they originally had. I actually ended up with none.
I had at one time over $50,000 in my 401(k), but had pulled it out to pay off credit card debt. On average most American employees have $33,000 in their 401(k) at age 30. Now most financial planners would tell you that amount would turn into over $500,000 when you reach 65. Granted that you earn an average of 8-12%. So, with me having $50,000, imagine what I would have in another 30 years.
However, using the $33,000 as an example, $33,000 would end up being worth more like $18,000 after taxes and penalties. In my case, the rest of my debt had been eliminated, but my 401(k) was wiped out and I ended up paying $15,000 in income tax. Unfortunately, most people like me cash out their 401(k) when they are laid off.
If you are laid off, do everything you can to avoid the temptation of withdrawing from your 401(k). When you do go back to work, some employer 401(k) plans will allow you to re-invest your old 401(k) into your new one, but if not, you should roll your 401(k) into an IRA. I know you may busy getting adjusted on your new job and whatever else life throws at you, but you must make the roll over a priority.
Use me as an example and do not cash out your 401(k) and pay 40 percent in taxes and penalties. Do what you have must to roll it in an IRA and leave it until you retire. Fill out the roll over paperwork. Thirty minutes of your time is worth it. If not, $100,000 or more is all you have to lose. You decide.
Photo Via (401khardshipwithdrawal.com)
[This post is written and copyrighted by Financial Elite (http://financialelite.blogspot.com/ ).]
Did you enjoy reading this article? You can receive free full-text articles from Financial Elite by RSS in your email inbox daily by entering your email HERE. Your email will only be used for this daily subscription, and each email will include a link you may use to unsubscribe at any time. Also follow us on Twitter.
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