“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.

Is Advanta in Breach of Contract on Credit Cards?

As of July 30, 2009 - Advanta Bank Corp. stated that they were closing all business credit card accounts. They cited in the letters that went out that an independent trust which owned the balances cards and provides funding for new transactions was pulling out. As such, you need to keeping paying your balance but Advanta will be unable to provide further credit.

Now under basic contract law which is the thread between your agreement with credit card companies there is an offer, acceptance and consideration. Advanta offered me credit and I accepted and the consideration is the the act of providing credit with my obligation to pay it back with interest. Now, as a result of Advanta losing a trust that was funding these, they suddenly are in breach in my mind and as a result, they are asking me to modify my agreement without new consideration which is a requirement to modify the terms of any agreement.

A breach occurs when the bargained-for exchange is not honored by the other party, in this case Advanta Bank Corp. I believe I’m entitled to an order of performance which is the extension of credit otherwise what incentive do I have to pay back any balance on this card? They have not offered me additional consideration like to pay less or go without interest and I think this is not only a breach but unconscionable that Advanta could not act it good faith and fair dealing and assumes the public is stupid and unaware of their rights.

I implore all consumers, if your card is cut off please get a copy of your original agreement and all addendum and see if they have the ability to do this or take the credit card company to arbitration since they make that a part of the agreement. I intend to call and get my card settled for a lot less since they are in non-performance and breaching their agreement.

Wake up and take back your power and let them know you’re not going to be insulted and slapped around any longer. Chime in and let us know about your credit card stink by leaving a message below.

Sincerely,

James Burns, Esq.

“Loan Modification or Complication?”

The plan centers on Fannie Mae and Freddie Mac, which between them own or back about 31 million mortgages worth a combined $5 trillion. The federal government took over the firms in September due to mounting losses on their portfolios of mortgages.

Eligibility is determined by several factors: Homeowners must be 90 days or more late in their mortgage payments, owe at least 90% of their home’s current value, live in the home on which the mortgage was taken and have not filed for bankruptcy.

Their mortgage payments would be adjusted through lower interest rates or longer repayment schedules with the goal of bringing payments below 38% of monthly household income. Interest rates could be lowered for five years and then raised to a predetermined level. Loan terms could be lengthened to 40 years.

Officials said the standards for loan modifications should fast-track changes in payments. The standards will be applied to loans owned and guaranteed by Fannie and Freddie, but officials said they hope they will also be adopted industry wide.

“We expect that it could significantly increase the number of modifications completed,” said James Lockhart, director of the Federal Housing Finance Agency, the regulator that oversees Fannie and Freddie. …

Fannie reported this week that 1.7% of its mortgages by value are delinquent by 90 or more days. Fannie’s filings suggest that it has about 18 million mortgages on its books, which would work out to about 300,000 mortgages that could potentially be eligible. The borrower will ultimately be responsible for paying the full amount of the principal borrowed, but payment on part of the principal can be deferred to make the monthly payment affordable.

Homeowners who purposefully default on their mortgage to get a modification will not be eligible. Borrowers will have to submit a statement showing financial hardship or a change in financial circumstances, along with proof of their income. The modification will become final once a borrower has made three payments under the modified terms.

But even in cases where declining home prices have taken the value of a home to less than is owed on the mortgage, the balance of the loan will not be lowered under this program.

“This is not loan forgiveness; the loans will be paid but at terms affordable for borrowers,” said Brian Montgomery, commissioner of the Federal Housing Administration.

The fact that mortgage balances will not be reduced for the so-called underwater mortgages — those in which a homeowner owes more than the home is worth — will limit the use and impact of the program, according to some experts.

However, there is a competing interest in getting modifications done and that is the investors who purchased these loans. Some hedge funds, including Greenwich Financial Services and Braddock Financial, told banks in October that they might sue the banks if they changed mortgages that were within mortgage bonds that the hedge funds had purchased. Modifying the terms of mortgages underlying mortgage bonds can change how much those bonds are worth.

Investor rules and underlying servicing contracts with respect to modifications are not uniform and may prevent us from doing modifications that would benefits borrowers and investors.

Under the plan, Fannie Mae, Freddie Mac and other mortgage firms will rewrite the terms on some overdue mortgages so the homeowners won’t pay more than 38% of their monthly income. Modifications could include deferring some of the principal owed, lowering interest rates or extending maturities to as much as 40 years. The process will be streamlined and uniform.

If you know someone in need of saving their home have them contact my office after downloading our questionnaire which should be faxed back to use…get it here .

James Burns, Esq.

Is the Sky Falling?

I could tell you from what we are seeing in mortgage modifications and short sales that things look a little bleak. Every week i meet with would-be investors who are now clinging on for dear life because they bought too much investment property without real income to support them. When I see people they are ready to walk-away, let it foreclose and tragically trash their credit for a decade.

There are choices and sometimes we have to face the music. The way your character is tested is by how well you deal with adversity, I’m finding many people are ready to abandon their leadership capability and run and hide under a rock. Sure there is a little embarrassment that goes with being a failed real estate investor but ultimately you have to face it and do what is right to keep your credit in tact.

First, a little history on credit scores. A company called the Fair Isaac Corporation created the first credit score. It was made available to lenders in the very late 80s and soon thereafter began to pick up momentum and popularity in the lending world. They called it the FICO score  and it became the gold standard in the mortgage and other consumer lending.

For years the FICO score was a mystery to consumers and was only known by the lending industry. Credit scores have only recently been made available to the public in the last few years. In 2001, California passed a law that required credit scores to be made available to California residents.

It also turned into a cash cow for the bureaus. However, for two of the three, instead of selling the actual FICO score, where they had to pay royalties to the Fair Isaac Corporation - they created their own scores to sell to consumers, that’s where the confusion started. Now all the bureaus  sell scores targeted at the consumer market, and unwitting consumers assume that these scores are the same scores a lender would see. Unfortunately, this is just not the case as Edward Jamision, Esq. would point out. His office has one of the best credit repair services that we look forward to bringing on.

Sometimes if you qualify for the loan modification which means you have a current loan that is 7.5% or more or is going to adjust or recast, and you want to stay in the home. Another thing you need to consider is getting your property tax bill reduced which we love to assist people with and you can examine the numbers for your self by going to this link. For a minimum fee you can get your annual tax bill reduced and save some money there.

If you’re looking to consider loan modification or if you owe more than the property is worth and are having financial difficulties you’ll want to download our questionnaire from here and you’ll also find our e-book “How to Avoid Foreclosure- 3 things you can do right now” which gives you great information on your options. Stop the worry and find solutions to your housing problem.

Untaxingly,

James Burns, Esq.