“THREE WAYS YOU CAN AVOID GOING BROKE IN THE NEW ECONOMY”

The first thing you can do as illustrated in “The 3 Secret Pillars of Wealth” book is take ownership of your monthly expenditures by having a family budget and a family balance sheet you observe with conviction. If you’re desirous of change, you have to do the work since the only place success comes before work is the dictionary.

Number two, if your home payments are too high because you’re job or industry has fallen off, seek a loan workout with your lender or use a law firm to assist you that has a success rate.

Mr. Burns also states that if you are carrying too much bad debt like credit cards and you’re slowing sinking into the quicksand, think about debt settlement or management services that don’t have an upfront cost and can get you from point A to point B in terms of eliminating this debt. While it may have a temporary blemish on your credit score, at least you get back to the surface where you can breathe.

Lastly, if you’re crunched for cash to invest or pay down bills, look if you or your parents have an old universal life or convertible term life insurance policy that has underperformed or is not really needed and consider having it sold in the secondary market as a life settlement.

More power solutions are available right here so stay tuned, get involved and please send in comments so we can save or pick up lives in this down economy. In numbers we are strong.

James Burns, Esq.

Tax Free Income for Life

I’ve been working on my new program which is going to be essential as Congress is likely to shift the entire marginal tax rate making your deferred plan (IRA or 401(k)) obsolete. You’ll want to take a look at our two vehicle system to build up tax-free.

One of the vehicles is the Solo-401(k) ROTH self-directed plan. This vehicles does not have income limitations on the $165,000 for a couple filing jointly the way the ROTH IRA does. It is designed for solo-practitioners, those without employees or contractors or part-time people.

Since it is ROTH you pay your taxes up front but never pay again on the build-up or when you take monies out in the future. Traditional deferred plans allow you to defer taxes but get hammered when you retire if you are in a higher tax bracket and without tax deductions to offset which is uniformly the case for a retiree.

You can contribute up to 25% of compensation and additional catch-up is available for those 50 or older. A $41,000 annual limit applies and is indexed in the future up to 2010 unless the new regime changes things when they are sworn in as President and one could be higher than the other. A cap of $205,000 on compensation  was in force as of 2004 and is indexed up to 2010. The benefit is that you can set aside more tax-free money in the solo-401(k) ROTH than other plan choices and if it is self-directed, you do have to remain victim to what the market provides as you can have numerous choices for guranteed returns that are not connected to the market at all.

Remember this is just one half of a dynamic duo that provides for tax-free income for life. You’ll want to examine the seld-directed arena so that you’re not held to just mutual funds and other market connected investments that are roller coaster driven because they are up and down according to whimsical financial and political events.

If you have questions or are looking to set one up or need information on the “Dynamic Duo” you can find our e-book “Tax Free Income for Life” available on the website.

Untaxingly,

James Burns

California’s New Foreclosure Law

As a result of the subprime loan market collapse, numerous bills were introduced this year in the California Legislature, including the recently enacted SB 1137.  Within this highly charged political environment, the California Land Title Association (CLTA), along with trustees, escrow companies, and lender groups originally opposed this legislation, which subsequently underwent a series of significant amendments before being signed by the Governor earlier this week.

SB 1137 became effective July 8th as an urgency measure.  However, requirements pertaining to the notice of default and the posting and mailing of an entirely new notice will not become operative until 60 days after the effective date.

The provisions of the new law outlined below apply to loans secured by owner occupied residential real property and made between January 1, 2003 and December 31, 2007.  These provisions will remain effective until January 1, 2013.  The requirements are extensive and the full act text should be consulted for details.

1. A Notice of Default (NOD) may not be filed by the trustee or lender until 30 days after contact is made in person or by telephone with a borrower to asses their financial situation and explore options to avoid foreclosure, or until 30 days after satisfying specified due diligence requirements.
2. During the initial contact the borrower must be advised of the right to request a subsequent meeting.  If a meeting is requested then it must be scheduled within 14 days.
3. An assessment of the borrower’s financial situation and discussion of options may occur at the first contact or at the subsequent meeting, but in either case the borrower must be provided a toll-free number for HUD certified housing counseling agencies.
4. A NOD must include a declaration that the borrower has been contacted or due diligence has been used to try to contact the borrower or that the borrower has surrendered the property.  Due diligence includes having a link to information on the options to avoid foreclosure on the web site of the beneficiary or their agent.
5. If a NOD was filed prior to the effective date of the new law, without a subsequent notice of rescission, then a new declaration must be included as part of the notice of sale.  The declaration must state that the borrower either was contracted to assess their financial situation and explore options to avoid foreclosure or that no contact occurred; in which case the efforts made to contact the borrower must be listed.
6. A NOD may be filed when a borrower has not been contacted as required by the new law if the failure to contact the borrower occurred despite the due diligence of the lender or their agent.  The actions that constitute due diligence are listed in the new law.
7. A new notice has been created by the law and must be posted and mailed at the same time a notice of sale is posted.  The notice advises residents that the property may be sold and that their right to continue to reside in the property may be affected, along with certain other information.

If you have questions please send us an e-mail or if your facing a personal crisis with your mortgage because it has spiked out of control with the interest rate or you owe more than the home is worth and will be worth for years to come we may have legal solutions for you that can put you on the track to recovery. Please download the form on this page and fax it to us available Right here.

The Sky may be Falling for the Next Decade

As a result of our efforts to save homes and in essence, save America, we are finding out that this popped bubble may last a decade.

Recent reports show that Wachovia and Washington Mutual may have concealed the actual numbers of defaults on their books so that executives could get their bonuses. This means other banks could fall by way of Indymac and have difficulties going forward.

The good news is if you have a loan on your home or an investment property that is costing you more than it’s worth or you put the wrong loan on it, we can help with a loan modification or short sale.

Here is a recent modification case.

Woman was at 10.95% before modification.

New modification:

2.25% for next 3 years adjusting to 6.25% cap in 2014. She makes no payments until October 2008 and was settled this month.

If you need help go to this page and download the modification questionnaire. Fax it in to us when it is completed.

Stay safe,

James Burns, Esq.