1.) Loan reinstatement is where a lender has started the foreclosure process and the homeowner finds a way to pay back or “reinstate” the entire deficiency owed. The deficiency amount includes back loan principal and interest payments, accelerated interest costs, attorney’s fees, assorted processing and collection expenses, and late penalty charges. This technique requires the maximum amount of money all at once. Ironically, lenders recently indicated that pre-payment penalties may be included into final judgments in the near future.

When the homeowner’s reason for the delinquency is resolved, he usually asks the lender to take partial payments because he can’t get the entire deficiency amount together. However, the lender will not accept partial payments and the foreclosure will proceed if the full reinstatement amount isn’t paid. The reason for this is simple, the lender knows that the homeowner’s chance of getting out of, and staying out of foreclosure is less than 1 in 8. So the lender does not want to drag out the inevitable, the loss of the home to foreclosure.

2.) A forbearance agreement between the lender and the homeowner stipulates that the homeowner must make additional monthly payments for a specific period to make up the reinstatement amount that he couldn’t pay in full. As simple as it sounds, it may be unaffordable for the homeowner who could barely afford the original loan payment. The lender will usually ask that the homeowner pay the reinstatement amount over a three or six month period. If the monthly loan payment was $2,000 per month and he was 3 months in arrears, the new monthly payment for a three month period would be at least $2,000 + $6,000/3 = $4,000 per month. For a six month repayment schedule the new monthly payment would be $2,000 + $6,000/6 = $3,000 per month. In some instances the lender may ask for an additional cash payment before they will start the increased monthly payments. After the 3 or 6 months, the loan payments revert to the original amount or $2,000 in the above example. The foreclosure does not stop with the signing of the forbearance agreement but simply is put on hold until the homeowner completes making all the increased payments.

When you speak to your lender try for 12 months and don’t accept less than 9 months unless you can truly afford it! Ask them to review your financial statement, which they should readily send you and remember that the lender has already pulled your credit report and knows where you work, possibly how much you make, how many other monthly payments you have, and other information in the public records. They have also done a price analysis on your home and probably had a Broker’s Price Opinion (BPO) completed. Essentially they know what answers you should be giving them, so be forewarned. This method of reinstatement takes as much money as the loan reinstatement except it is spread over 3 – 6 months or, hopefully, more.

3.) A loan modification program was the most common method of foreclosure resolution for decades. It involved the lender issuing a new loan agreement where the deficiency amount was added to the loan balance and paid in identical monthly payments but for many more months, at the end of the loan. The monthly payments remained the same and if the home was sold, the balance of the reinstatement amount was paid from the proceeds of the sale. This method of resolution requires no up-front cash and the same monthly payment as before the foreclosure.

Another type of loan modification was to very slightly increase the monthly payments over the remaining term of the loan. So the homeowner has a choice of either extended but identical payments (as above), or slightly higher payments for the original term of the loan. Either option repaid the lender his money back plus interest. It was an affordable win-win for the lender and the homeowner, but is seldom offered anymore unless the lender knows the property is not worth taking back by foreclosure and he hasn’t sold the loan into a mortgage pool.

Loan modification programs are usually not available unless there is a hardship involved such as a job loss, death or illness. But it is worth asking your lender about it if you are in foreclosure because the market conditions and massive loan defaults puts pressure on the lenders to be more cooperative with homeowners. Your best option is to talk to your lender and as early as possible so you have time to resolve your problem.

About The Author
Dave Dinkel is the author of http://www.StopMyForeclosureMess.com “32 Ways to Quickly Stop Foreclosure and has helped thousands of foreclosure victims for nearly 33 years. If you are facing foreclosure, visit http://www.StopMyForeclosureMess.com StopMyForeclosureMess.com for guaranteed solutions.

If there is one thing that you can be sure of regarding the economy it is this: it will change. Like most other things in life the economy goes through cycles and while you may not be able to predict when things will improve or decline you can bet that they will. As families struggle through the current recession it is important to remember that this is not the first nor the last time that the economy will take a turn for the worse. In knowing this you should also know there are a few simple ways to prepare you finances to ensure you weather the current cycle and remain in a position to benefit when the economy takes it’s next turn; hopefully for the better.

1. Have multiple streams of income- A few decades ago it was standard procedure to graduate from either high school or college and establish yourself with a company for the long haul. Those times have changes and if you wish to be financially secure it is important to understand the benefit of having multiple streams of income. Even if you have a great job with a great salary in times when the economy falters layoffs and downsizing become a reality many people are simply not prepared for. If you depend on just one source of income and you lose that income your finances can quickly take a turn for the worse. If you are fortunate enough to have a severance package you may be able to live off of that for a period of time, but you will eventually have to find another job and in the interim you may have to dip into your savings to survive.
2. Diversity is the key- Similar to the first tip, having a diverse portfolio is the best way to protect yourself from losing everything in one fell swoop. The economy is simply not predictable enough at any time to have all of your eggs in one basket. Your age and the age at which you want to retire play a big factor in how risky you want to be in the market, but you should always spread your investments in a way that some money is safely tucked away slowly making more money.
3. Manage your debt- An import lesson was brought to attention in the last year. Millions of people have learned that their spending and saving habits leave a lot to be desired. If you have debt now is the time to tackle it once and for all. If you can do it on your own by cutting costs and focusing serious energy and efforts toward debt reduction- then by all means go for it. Keep in mind that you will likely have to take a serious look at your lifestyle and make appropriate changes to ensure you do not dig yourself out of debt only to find yourself back in debt from using credit cards or overspending. If you are overwhelmed and your debt is making it impossible to move forward financially it is time to look into the various debt relief options available to you.

Managing your finances does not have to be a game of chance, by using common sense and paying attention to where your money is coming from and going you should be able to stabilize your finances without much difficulty.

• If you pay for trash removal, cancel your service and go in together with your neighbor (or just put your trashin front of his house).
• Wait to wash your dishes until the dishwasher is completely full.
• Turn your computer(s) off at night.
• Don’t run the water while you are brushing your teeth.
• Wash your clothes only in cold water.
• Use the back side of previously-printed on paper in your printer, unless you are printing a non-draft item
• Use your cruise control
• Take your lunch to work.

There are lot more ideas on saving money, but here is something you can do to kick start your efforts.  Pick 2 consecutive days during the week and implement every money-saving option on those 2 days.  It will help you get into the habit.

Happy Saving…

Living On A Budget

Do you always feel the shortage of money before the next pay packet? Do you want to upgrade you television set since last couple of years but are always short of cash? If you aim for a better standard of living and are targeting for a long term financial security then a proper budget planning is a must. You should try living on basic budget and start investing the surplus for a better return.

The most common problems faced across majority of working household in America is their inability to meet the basic living expenses which in turns speaks volumes about the economic health of the country. Living on basic budget means having sufficient amount of funds which will help you maintain and sustain a decent standard of living in a safe and secure community. Family’s basic budget is dependent on the number of factors like the number of children in the household, if you are a single parent, number of earning members in the family and state where you are residing in. While planning a budget the expenditure on following essentials should always be kept in mind:-

• Accommodation – Set aside an amount which you need to pay as a rent if staying in a rented apartment or keep aside the amount you need to pay as you monthly installment if you own private property.
• Food – You need to plan your budget to provide your family with a balanced nourishing diet
• Health care – It always better to have medical cover in case of emergencies for all your family members so do make plans to pay regular premiums for renewing these medical policies
• Taxes – Taxes which needs to be paid to the federal and state government should also be taken into account
• Education and child care – If you are pursuing any part time course or are paying education loan consider that amount in the budget. If having children in the family then a definite amount should be set aside for their education and health care need
• Other needs – Other factors such as transportation, personal grooming, clothing and other miscellaneous expenditures like paying of bills should also be included while planning a budget

You can plan you basic budget using simple pen and paper or Microsoft excel spread sheet. Alternatively, you can also download budgeting software from net. By keeping a track of your income and your expenditure, you can easily find out the surplus cash which can be used for investment and savings. In this way you can also be made aware of the shortages which will prompt you to cut the corners. Neilson research shows that, if you are living on basic budget and keeping track of all the inflow and outflow of cash you can actually save 15-20% of your yearly income. Keeping a track of your personal expenditure will also help you in faster clearing off your debts , plan for all the fun stuff like movies , basketball match tickets , keep a track of spending habits of your children and also instill in them the value of money.

So keep a track of your income and spending habits and plan your budget, this will definitely let you enjoy all the goodness of life while still living on basic budget.

I am going to be evaluating all of the following bills and will be taking drastic actions, if necessary, to get the costs reduced:

• Sat TV
• Home Phone
• DSL

• Settling Credit Card Debt

It is truly sad that more people are not aware that it is very possible to settle credit card debt personally without ever having to deal with a legal representative. If the credit companies that you owe money to decide to take legal action against you, they will charge you with their no doubt costly legal fees.

It would be wise to call the credit card companies yourself and try to work out a settlement agreement with them on a personal basis. The credit card companies really don’t want the situation to progress to the point where they have to take legal action, so they will probably be willing to negotiate even if your account has been delinquent for several months.

Start by trying to adjust your interest rate and lower service charges that have been applied to your account. Once you know what the credit company is charging you, you will be more prepared to negotiate effectively with them on a settlement.

In your efforts to reach a debt settlement with the credit card company you should focus your efforts on negotiating over the interest rate and service charges first, not discussing the principal. The credit card companies make their money off the service charges and interest rates on your account, so try to make a deal that benefits you both mutually.

Next Comes the Hard Part

The money that you spent on purchases that has already been paid by the credit card company, called the principal, is the hardest aspect of your debt to negotiate over with credit card companies. They don’t want to have paid for something and not have you pay them back.

Getting your way with negotiations over the principal is not easy, so don’t feel bad if the credit card company refuses to budge. Even getting the company to adjust your interest rate or service charges is difficult. Remember that the credit card company’s goal is to get their money from you, not repossess your things.

Regardless of what agreement you reach with the credit card company, you need to be prepared to follow through with your end of the deal. If you fail to meet the terms of your settlement plan, you can expect the credit card company to take aggressive action to get their money, not a second chance.

You will be shocked at what the small expenses add up to. Add up the cost of the unnecessary things and multiply that by 12 months, then multiply that by 5 years.

That is how much you could have saved (and drawn interest on) in just five years. This is the very reason everyone needs a budget.

We can enjoy financial success if we can get control of those small expenses that really have no bearing on our lives.

One example is the amount of money you may be spending on lunch.  Cut what you spend on lunch from five dollars a day to three dollars a day.  In a week, you will have saved $10. $40 in a month… $480 in a year… $2400 in five years….plus interest.

Don’t worry.  You will still be eating lunch everyday.  You will, however, have saved a ton of money and that’s just on lunch. There are other areas of your life where cuts can be made.

Set some specific long term and short term goals. There are no wrong answers here. If it’s important to you, then it’s important period.

If you want to be able to pay down some debt, buy a new car, or pay for your kids to go to college, think about the little things before it’s time to pay for the big things.

I’ll bet you’re wondering what organization has to do with saving money.

Actually quite a bit!

Imagine that you’ve been looking all over your house for that book/DVD/sunglasses/whatever and you can’t find it. Or imagine that you’re at the store and can’t remember if you still have any bananas or jars of strawberry jam.

Simple things, right?

Well, when we can’t remember what we have and don’t know where to find what we have, we usually end up buying it again. And then, before you know it, you’re like my aunt with 17 umbrellas.

My mother always says that once you replace something you can’t find, you’ll find the original missing item. I’m sure many of you have heard that as well. But for as many times as we’ve heard this, we still do not take action and bring some organization into our lives to avoid spending money when did not need to spend in the first place.

So, what do we do about this? The answer to almost every organizing problem is to have a system. Why a system? Because we are creatures of habit and mostly prefer to do things the same way every time. Not only that but with a system you have less to remember. You just follow the system.

There are a couple of systems you can put in place to help you save money in various areas of your life. Here are 4 areas in which you will want to find a system that works for you to help save you tons of money in the end.

1. Grocery Shopping

How many times have you been at the grocery store, without your list, and wondered if you should be an item you’re not really sure if you have or need?

I’m willing to be it happens a lot. It happens more when you don’t have a list. It happens even more when you don’t know what you have in your kitchen.

Here’s what I suggest. Go through your cabinets and fridge before you attempt to make a shopping list. The list you’re about to make is what you can see that you’re missing or low on. Next, depending on how often you shop (I suggest no more than weekly) and plan your menus accordingly. So, plan menus weekly if you shop weekly, two weeks at a time if you shop bi-weekly, etc.

Once you know what you’re going to make, you can look at what you’re missing (from your first list), and make your shopping list accordingly.

When you get to the store, do not deviate from this list. Take appropriate coupons if you want to, but don’t go hungry and leave the kids at home.

2. Shoes

What woman doesn’t like to have a variety of shoes? Unlike men, we must have different shoes for different outfits, occasions, and seasons. However, this love of shoes can go overboard.

This has happened to me, I must admit. While shopping for something totally unrelated, I saw a great pair of gray houndstooth heels in Target. The only problem was the heel was a little too high and the size 11 was probably one size or so more than I needed.

I reasoned that my feet would swell and I wouldn’t be standing long anyway. Plus, the shoes weren’t expensive. Well, I stood for a long time on the day I wore them, it rained, and they were too big. They were worn once and are now on their way to charity. What a waste!

I should have taken stock of what I had and thought about what I was going to wear on that occasion. Had I done that, I would have saved my feet and my money.

So, take note: know what you have before you start adding to your collection.

3. Clothing

What goes for shoes also goes for clothing.

I used to get clothing as gifts from my parents and internally wondered where they thought a 14 year old was going to wear a white ruffled shirt in 1995. (I eventually found a use for that shirt in one of the plays I was in.)

The point is, even though they were trying to be nice about it, the clothing choices didn’t fit my existing lifestyle. We do that sometimes. Whether it’s a trend or something great we saw on someone else, we figure it’s just something we have to have. But, by thinking this way, we often ignore the fact that it’s not our style, it’s not flattering, or it’s out of our budget.

The organization here also revolves around knowing what you have. This will help you determine what you actually need and if there is room in your budget and your closet for the things you want.

4. Bills

The key to organization and paying bills is really simple. Pay your bills on time.

One more time: pay your bills on time.

This advice is most important when the bill is a credit card or loan. Late fees and over the limit fees (sometimes as a result of late fees) can seriously hinder your ability to eventually be debt free. (Who wants to stay in debt forever?)

There are a couple of ways you can do this. You can pay the bills as you receive them in the mail (if you still get paper bills) or as you receive notification by email for electronic bills. Or, to make this more automated and ensure the bills are paid on time, sign up for a 3rd party service, one at your bank, or one offered by your creditor where the payment is automatically debited from a designated checking account each month.

There are a number of ways to have as much or as little control over this process as possible, but the point is to set up a system and stick with it so that you don’t lose money to late fees and penalties.

5. Miscellaneous Items

This is the area where so many people get into trouble.

We find ourselves at the store and we see something we like. We think we have one at home, but we’re not sure. So, instead of waiting until we get home to verify (or call someone who is at home), we purchase the item anyway and end up with multiples. (Remember the 17 umbrellas?)

It’s good to wait to make some purchases anyway, but the more organized you become, the more aware you are of what you have. When you know what you have, then you also know what needs to be replaced or what you’re lacking.

Once you start organizing, you will find a surprising number of items you have bought and you can’t remember why or what it is even for. You will also find the things you thought were lost but were really just buried under foolishness and mayhem called clutter.

Do yourself and your family a favor and stop the foolishness. Get organized and save money. You’ll be glad you did.

How Organization Will Save You Money
Copyright 2008
Wendy Stewart
All Rights Reserved

NOTICE: Article(s) may be republished free of charge to relevant websites, as long as Copyright and Author Resource Box are included; and ALL Hyperlinks REMAIN intact and active.

Get your credit report. I blogged about how you can do that for free. It is important to know what is on your report, and to clear up any negative or incorrect items as soon as possible. If you’ve set aside $25,000 to invest, but you have $25,000 worth of bad credit, you are better off cleaning up the credit first!

Look at what you are paying out each month, and get rid of expenses that are unnecessary. High interest credit cards, high interest unsecured loans, and services you are paying for but do not use are good examples. Pay them off and get rid of them.  If you can, exchange the high interest credit card for one with lower interest and refinance high interest loans with loans that are lower interest. You may have to use some of your investment funds to take care of these matters, but in the long run, you will see that this is the wisest course of action.

Get yourself into good financial shape.  You can then enhance your financial situation with sound investments.

Also, don’t invest if your bank balance is always low or if you are struggling to pay your monthly bills. Your investment dollars will be better spent to rectify adverse financial issues that affect you each day.

While you are in the process of clearing up your present financial situation, make it a point to educate yourself about the various types of investments.

This way, when you are in a financially sound situation, you will be armed with the knowledge that you need to make equally sound investments in your future.

• Chase Home Finance
• Citibank
• American Express

The down economy is affecting just about everyone. Based on that, I am expanding the scope of Spending Less 101 to include debt reduction information.

This is a little different subject. It has to do with debt collection. It is my philosophy that everyone is responsible for their actions, however, debt collectors can be real jerks and I don’t know how they can live with themselves when they go home at night. Maybe they are jerks, by nature.

This subject came up because I have been getting some calls on my cell phone. I searched for the number using Google and came up with the company that was calling me, AND, this neat service called whoscallingme.com. It’s FREE and with people coming together for one common purpose, there is a lot of information to be shared.

If they don’t have the information you need, search Google. If they do, please post a comment. It is truly better to give, than receive.

Gas Credit Cards are meant for saving money, keeping in view the high gas prices. You have a variety of cards to choose from, and each one has a different offer. These cards offer you a rebate up to 5% on purchase of gas and also other items like grocery. The rebate is lower in the case of purchase of items other than gas. When you have earned cash back of $50 all you have to do is obtain the check from your credit card issuer.

Certain Gas Credit Cards offer comparatively higher rebates on hotel reservations and travel including flights and car, and also double rewards for the initial bills. Certain other credit cards have come up with innovative ideas like rebate on purchase of automotive parts, no interest on purchases for a certain number of days after the billing date etc. Though you are on the look out for such incentives you should be sure if you are actually going to use them, and are not going to incur loss for the kind of rewards you do not actually require.

There is ambiguity regarding any introductory offer, and before taking a decision you should pay special attention to the fine print. You can notice that in many cases the percentage of rebate offered by the Gas Credit Cards drop dramatically to less than half after a certain number of days. And even though you are happy with the functioning of your credit card the issuer may change the terms and conditions or add a clause, suddenly to your disadvantage.

Also the rebates may not be offered at all the gas stations, which may cause you inconvenience and also sometimes extra gas. Your effort always must be cash in on the rebate, you have to request for a check or money to be transferred into your account, instead of waiting for them to pay you, as the rebates may cease to exist after a given period. If you intend to carry a balance like majority of the credit card holders do, you might end up suffering loss on account of the high interest rate. The idea of the Gas Credit Card is to save you a few dollars and not accrue debt.

Because of the stiff competition in credit card business the companies are always on the look out for innovative methods to attract customers. As gas is something everyone buys, teaming up with a gas company means better business. On the other hand the gas companies themselves offer credit cards which can be used at only those gas stations. Rebates are offered for purchase of gas and items on sale at the particular gas station. Sole gas station credit cards generally offer more discounts, and in case of a gas station in your neighborhood it is a good idea, unless you are going on a trip and you run out of gas. Other advantages of using these cards besides the rebate is that you need not carry cash and expenditure on gas will not be mixed up with regular expenditure.

If you are particular about monitoring the expenditure on gas these cards offer monthly statements with list of purchase. Like other credit cards you may watch out for annual fee or other hidden charges in case of the Gas Credit Cards too.

Gas Credit Cards are credit cards that help you reduce travel expenses by offering rebate on purchase of gas, and also on certain other purchases.

Article Source: http://www.content.onlypunjab.com

Gary L. Scurry offers advice and great tips regarding all aspects concerning Gas Credit Cards. To view my hot pick for Gas Credit Cards visit www.credit-cards-4-all.com/ and compare Gas Credit Cards offers.

]]> http://www.spendingless101.com/2008/06/07/learn-how-to-use-credit-to-save-money/feed/ 5 http://www.spendingless101.com/2008/05/18/29-free-ebooks/ http://www.spendingless101.com/2008/05/18/29-free-ebooks/#comments Sun, 18 May 2008 06:25:57 +0000 John http://www.spendingless101.com/?p=102
This post has been 10 days in the making. It’s been a long, hard road, but here it is; 29 free eBooks.

Enjoy:

1. LegendFire’s Writer’s Guide
2. Vedic Mathematics
3. Poems From My Soul
4. Cell Phone Recycling Guide
5. 100 Ways To Save The Planet
6. Building Wealth: A Beginner’s Guide to Securing Your Financial Future
7. Pathways to Getting Ahead
8. Money Matters: Your Guide for Financial Security
9. Banking Basics
10. Simple Strategies for Managing Your Money
11. Taking Control of Your Finances
12. Consumer Action Handbook
13. Consumer’s Almanac
14. Ten Questions to Ask When Choosing a Financial Planner
15. Building a Better Credit Report
16. SHOP: The Credit Card You Pick Can Save You Money
17. Healthy Credit
18. 66 Ways to Save Money
19. Get the Facts on Saving and Investing
20. Savings Fitness: A Guide to Your Money and Your Financial Future
21. Money for Life
22. Save Money On Gas
23. Dealing With Debt
24. Smart Saving and Investing
25. Money Matters For All Ages
26. Success Tips For Home & Biz
27. Build and Remodel Your Own House
28. The Science of Getting Rich
29. Money For Life – Budgeting Success and Financial Fitness in Just 12 Weeks

If you don’t like that one, here is another money-saving idea on showering. Get a gym membership somewhere that has a nice shower facility. Shower and shave there instead of at home. You’ll save money on electricity and water. You may even work out every once in a while.

When it comes to free food, go to the drive up at any fast food place and complain about them forgetting part of your order from earlier in the day. They will usually give you free replacement food without questioning you.

If you want a free drink, keep cups from various fast-food places. When it is time to get your drink, go by one of the places you have a cup from, take the cup in and fill it up.

If you use coupons, try this and you may hit the jackpot. Take a bunch of coupons (even ones for things you didn’t get), to the store and turn them in at the register when you check out. If those things are flagged as you not having them, most of the time, the cashiers don’t check; they just give you the credit.

If you email a chain restaurant and complain about something, you will most-likely get a coupon for free food.

On second thought, don’t do any of these. They are not a good idea.

1. The 10 Most-Hated Money Saving Tips
2. Top 10 Foods Not To Buy Generic
3. 10 Tips For Becoming A Smarter Shopper
4. 10 Myths On Saving Money At The Grocery Store
5. Top 10  Computing Energy Savers
6. Top 10 Grocery Strategies For Saving Money At The Grocery Store (title could have been shorter)
7. Top 10 April Fool’s Tips To Save Gas
8. Top 10 Money Saving Tips
9. Top 10 Grocery Saving Tips
10. Top 10 Car Dealer Scams