Beware of foreclosure rescue scams
March 18, 2009
Any time the economy is bad, it opens the door even wider for shady businesses, scams and fraud.
Unfortunately, it’s no different during the current housing crisis. With the news of government help for homeowners, there are plenty of people who are ready and willing to take advantage of people who are in a vulnerable position.
Here are a few things that should raise a red flag when dealing with a company that is promising to help you with your mortgage:
· The company solicits your business. Be wary of any company that initiates contact with you if you haven’t already contacted the company first.
· The company offers to find out who your mortgage loan holder is … for a fee. You can find out who holds your loan for free. Fannie May and Freddie Mac have web sites to help you obtain this information. (www.fanniemae.com/homeaffordable) (www.freddiemac.com/avoidforeclosure)
· The company is charging upfront fees and/or high fees. Reputable housing counseling agencies offer their services at no charge or for a minimal charge.
The Federal Reserve has also published a list of tips to help you avoid a foreclosure scam. You can find the list here.
The best place to go for help is to a non-profit credit counseling agency that is also approved by the U.S. Department of Housing and Urban Development to offer housing counseling. Advantage Credit Counseling Service is a HUD-approved housing counseling agency that can work with consumers in
If you do not live in one of those states, you can find an approved agency in your area at www.hud.gov.
These agencies offer housing counseling at no cost and can direct you to other reputable services in your area.
Also, before you do business with any company check their rating with the Better Business Bureau (www.bbb.org). And read all paperwork before you sign anything. Do not give out any personal information – like your Social Security number or bank account information – unless you are absolutely certain of who you are dealing with.
Would you walk away from your home?
January 21, 2009
I’ve been reading a lot lately about people who are walking away from their homes, not because they can’t afford the payments, but because they don’t feel their homes are worth enough.
On the MSN Money Community message boards, it’s not uncommon to see the discussion pop up. The topic is usually brought up by a homeowner who is considering walking away. Sometimes the topic is broached by people who are outright frustrated watching people walk away from their homes.
Inevitably the debate boils down to: Is it wrong to walk away from your home?
NPR did a piece about this very thing nearly a year ago when the reality of sinking home values and foreclosures was really sinking in.
On MSN, Liz Pulliam Weston wrote an informative story about when to walk away from your home.
What are your thoughts on the topic?
What’s in your house?
November 25, 2008
If you are facing any kind of a financial crisis, it’s clear you should look for a way to reduce your spending and increase your income.
Some people may have valuable items sitting in their homes and don’t even realize it.
CNN did a story about trash haulers who are making big bucks off of the wave of foreclosures. Many people leave their homes without taking their possessions, even very personal things like family photos. The banks left holding the properties have to clean them out.
It’s sad that people just leave everything behind. It’s also sad that they don’t look to see what they have in their homes that could help them through their financial bind.
The trash haulers interviewed in the CNN story said they have found valuable things left behind, including a painting appraised at $11,000!
I wonder if that homeowner even knew what they had. That’s a lot of money. Maybe it could have helped them to save their home, or provided them with some seed money to start over again.
Not all of us have valuable art sitting around in our homes, but if you’re experiencing financial difficulty, it couldn’t hurt to look around.
One of my family members discovered a set of silverware tucked away in a piece of furniture given to them by another family member. It turned out to be worth thousands. They don’t need the money right now, but it’s nice to know they have an insurance policy of sorts if they are ever in a situation where they need cash.
If you are looking for ways to pay off credit card debt or you’re facing the possibility of foreclosure — in addition to calling Advantage CCS for help — assess what you have in case you own something that could give you some financial help.
Sell your home; make it appealing to buyers
September 24, 2008
I was reading Gather Little By Little, a personal finance blog, this morning. The blogger, known as Gibble, is trying to sell him home. He wrote about the repairs they made to their home based on comments from prospective buyers and real estate agents who toured the home.
Everyone knows it’s a buyers market, and many sellers are having a tough time.
As someone who just purchased a home for the first time, I’d like to offer some tips to anyone who may be selling a home. These are just some thoughts from the perspective of a buyer. Some things cost some money, and some don’t cost a thing.
Clean up your clutter. It is hard to really see what a home looks like when it’s buried under mounds of knick knacks, photos, dishes, clothing, etc. Plus, it makes a perspective buyer wonder what’s hiding underneath all of that stuff. It doesn’t cost a thing to box some stuff up, put away some dishes and pick the dirty clothes up off the floor.
After you clean the clutter, clean the house. Run the vacuum cleaner, dust, spruce it up a little. And if you have pets, sprinkle a little carpet deodorizer around and hide the litter box. Pet smells are especially off-putting to buyers.
Rearrange your furniture. Look for ways to place your furniture that might make the rooms look a little more spacious.
Fresh paint is great. If it’s been awhile since you’ve put a fresh coat of paint on your walls — or if you have a room that is painted in colors that are unusual or suited to your individual taste — repaint in neutral colors. A gallon of paint goes a long way and is a fairly inexpensive way to please buyers.
About those carpets … If your carpets are old and dirty, clean or replace them. Replacing carpeting can be an expensive venture. If that’s not in your budget, consider renting a rug scrubber. They are easy to use, cost less than a professional cleaning service, but can really help out dirty carpets and rugs.
Try for curb appeal. Sweep the porch. Mow the lawn. Pull any weeds from the shrubbery.
Of course there are expensive things one can to do make their house more appealing to buyers, but many people can’t afford to reside their home or put on a new roof.
But, there are some simple, cost effective ways to increase your home’s appeal for potential buyers.
Please feel free to share any thoughts, tips or suggestions you have to help someone make their home more appealing to buyers.
What is a short sale?
September 19, 2008
Short sale is a term often heard lately as people struggle to pay their mortgages and avoid foreclosure.
But, what is a short sale? And what implications can it have in the future?
A short sale essentially means your lender agrees to allow you to sell your home for less than you owe on it. Banks allow this as an alternative to a foreclosure because it means they won’t have a property to maintain and resell.
A short sale can have a negative impact on the seller’s credit score. It also means that no profit will be gained from the sale to give the seller money to put towards the purchase of another home or rent for a property.
A bank may agree to a short sale, but still hold the borrower responsible for part of the remainder of the loan or the entire remainder of the loan.
The New York Times wrote about this. The story featured a couple who had to move for work-related reasons and found that the value of their home had dropped to below what was owed. The lender agreed to a short sale, but required the couple to pay back $40,000 of the loss.
According to the story, the couple’s lender sent them an e-mail telling them the lender would work with them when they were ready to “participate in the loss.”
Increasingly banks aren’t willing to bear full brunt of a short sale.
What can you do if you’re facing mortgage payments you can’t handle?
Contact a non-profit credit counseling agency, like Advantage CCS in
You don’t have to struggle through difficulties with budgeting and paying your mortgage alone. Get help as soon as you realize you are going to have a problem.
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