According to a recent article in the Los Angeles Times, mortgage interest rates are at their lowest levels in five weeks, and not surprisingly more people are seeking home loans.  This is can be seen as a positive sign that the value in homes are increasing slightly instead of homeowners being upside down on their mortgages.

This is both a positive and a negative for some homeowners.  On the positive side, this means they are able to refinance their homes at a lower rate and take advantage of equity in their homes.  But on the negative side, this assumes that the borrowers who are purchasing new homes still have good credit, can make at least a 20% down payment on residences with value of no more than $417,000.

Two important keys to this type of program:

• Loan amount available up to the maximum JUMBO FHA limit in your area
• FHA financing is for Everyone and not limited to first time homebuyers

FHA loans are guaranteed by the government and offer more flexible guidelines than traditional mortgages.  Some of these features are:

·         Down payment of 3.5%

·         Allows for lower credit scores

·         Cash out refinance transactions up to 85% of loan to value

·         No minimum or maximum income limits

When considering to refinance or purchase, a new property, the consumer must be prepared to present a complete financial package to their lender.  By having all the financial information available, this will allow your loan expert to find the correct loan program to fit your financial requirements.

There are several methods available to the consumer to consider when trying to get out of debt.  These methods are:

·         Try and manage their current debt themselves – in other words tighten their belt and spending habits.

·         Debt consolidation loan – this would combine all outstanding unsecured debt into a single payment loan. The problem is can the consumer qualify for a new loan with no job or financial hardship issue.

·         Refinance or Home Equity loan – This might work, if the consumer has enough equity in their home, however the repayment may be an issue.

·         Credit counseling service – This program acts like a debt consolidation loan. The consumer pays a third party company who in turns pays a small or set percent each month to the lenders until all the balances are pay off. In addition, there is credit counseling for the debtor and this will also have an affect on your credit score.

·         Bankruptcy – This is the most serious and the final step that a consumer should consider.  The consumer needs to discuss with an attorney all facets of bankruptcy since it will cover all debts, both secured and unsecured.

·         Debt settlement – This is a program by which a third party negotiates with the lender in order to reduce the outstanding balances on unsecured credit cards.

There are various kinds of options that consumers are given to get rid of their debts. In your credit  card debt payments have spiraled to 25 percent to 50 percent of your take home pay, you probably need some help with getting that problem corrected.   In today’s economy you are probably reeling from the weight of your credit card bills.  As painful as the situation is – you can fix your financial situation with Debt Settlement.

The debt settlement company negotiates on the borrowers’ behalf with creditors to reduce the overall debts in exchanged for an agreement upon regular payments.  The debt settlement companies typically have relationships during their normal business practices with the credit card companies and can come.

You see, debt settlement consist of long term payment agreements which can last from 12 -48 months.  If you are considering a Chapter 13 Bankruptcy that involves a long term repayment schedule from 5-7 years The process of Debt Settlement can be completed in a matter of months, depending on your ability to  pay the reduced settlement balances to your creditors. 

If your anxious to put your debt behind you sooner rather than later, you’ll be pleased with your decision to choose debt settlement to resolve your current financial situation.

What is Debt Negotiation? Debt Settlement is a process where a debtor negotiates with a creditor and the creditor agrees to a reduced principal amount of payback. Debt Settlement is also know as debt arbitration and debt negotiation. Debt Arbitration is considered to be an honorable way to settle your debts.

Will a creditor really settle debt with a debt negotiation program? Continue Reading »