A new excited home buyer!

I met with a client in late February related to the IDA Saver program. The IDA Saver is a program of United Way of Central Alabama(UWCA) that provides matching down payment assistance (or funds for a business, or funds for education to qualified, income eligible persons and families). Client is a single mother of three. In late February, client's credit score was in the high 400’s. Client did a great job following guidance, and came back in today December). Her credit score increased to 613. She and I were both thrilled with these results. She will move forward with the purchase of a home with UWCA’s help. It is an honor to be able to serve individuals and families in this manner. 

Another housing retention success storty

I celebrate every success story when clients receive a loan modification that enables them to retain their home. This week was another celebration week. A client experienced a loss in their family resulting in less retirement income (when we lose a spouse our social security income will decline, the living spouse will receive the greater of funds his or her partner received  rather than 2 checks). With reduced income my client became eligible for a HAMP modification. She received a reduction in payment this week of more than $200 per month. This reduction will enable this client to retain their home and live in greater financial serenity.  

Housing counselors can and do help

If you are having difficulty making your mortgage payment, do contact a non-profit housing counselor. You can locate such counselors on HUD's web site by following the attached link: http://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm
I share the following story from my work as a housing counselor. I received a call  from a client who had been ill for the past 2 years and during this time, her homeowners insurance (HOI) lapsed due to her failure to pay her insurer a required $30 membership fee (most insurers do not have this requirement). The client's lender, when they became aware of issue, force placed insurance. This means they purchased a HOI policy to protect their interest in the home. Her home payment went from $487 to $854 monthly! The force placed insurance only protects the lender, not the client (this is always true as many learned when tornadoes struck Alabama in April). My client had tried with no success to obtain help from her lender. We called the client's lender via conference call and were able to cure this problem. Her reduced payment was restored within 5 business days as soon as her insurer called the insurance department of the lender affirming that coverage was restored. If you feel wronged by your mortgage servicer seek professional help.    

Recent college grad job search challenges

Here is a link to a NY Times article written by Robert Goldfarb, a management consultant, comments on recent college grad job search and criteria essential to companies seeking new employees. Worth reading: http://www.nytimes.com/2011/12/11/jobs/helping-graduates-find-their-footing-in-the-workplace.html?_r=1&ref=business

Student Loan Debt caution!

I am watching the Suze Orman Show and a call comes in from a NYU dental student approaching graduation. She shares that she has $450,000 in student loan debt and asks Suze how she will pay this debt back. Nearly everyday in my work I see people as a financial coach who have too much student loan debt, are often taking on more debt, and are having trouble meeting their financial obligations including student loan debt. I offer the following observations and cautions:

1. Approach educational opportunities and the financing of same carefully.
2. Understand what the financial outcomes of students in the program you are entering have been. What do people earn, how long before they are able to get desired job, etc. Be a smart school and school financing shopper.
3. Consider if the program of study is within your means and are likely to produce good outcomes for you.
4. Be particularly careful about private for profit education institutions including online institutions. The cost of these programs tends to be high, the student loan default is much higher than non-profit or public schools.
5. Understand that it is very difficult to ever place federal or private student loan debt in bankruptcy.
6. Treat the decision to attend a particular school and program, and in considering student loans, as carefully as weighing a choice of spending limited money in your bank account or wallet. For many, the use of other people's money (OPM) can be much easier to spend than your own. This is a major mistake.
7. Note, I believe in the power of education. I believe well chosen career paths, well chosen schools, well chosen education funding options are in your best interests. Any shortcoming in these choices can be and will be dangerous to your financial and emotional well-being long-term. Life is always about making good choices. Making the right choices for you and your life circumstance.
8. Remember some professions including teaching, social work, and others offer the potential to have student loan debt forgiven after working in a field for ten or more years and paying on your student loan debt during this period.
9. Look into consolidating federal student loan debt, and exploring Income - Based  Repayment Plans if applicable.

Worth reading money and stress

I came upon the following article discussing money and stress. The article closes with a reference to the value of helping others as a great way to help ourselves! Worth keeping in mind anytime of the year. Wishing each of you Happy Holidays and a Happy New Year!
http://www.dailyfinance.com/2011/12/07/travis-stork-of-the-doctors-on-how-money-stress-can-make-you-s/

The Wallet Useful Resource and Article Regarding Money & Stress

Worth reading and periodically visiting this site: http://blogs.wsj.com/wallet/2008/12/10/more-ways-to-handle-money-stress/

HARP (not only a musical instrument)

If you or individuals you know meet the following criteria, they need to get to know HARP (Home Affordable Refinance Program):

1. They own their home.
2. Their loan is owned by FNMA or FHLMC (they own 80% of all conventional mortgages).
3. Their home is worth less than what they owe on their home.
4. Their mortgage rate is above current market rates.

Contact a HUD-approved housing counselor to explore HARP. Follow this link to locate a counselor: 

http://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfmhttp://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm

Reverse mortgages (for you or your folks?)

If you or your folks have considered a reverse mortgage, I offer the following insights:

1. Home owners must be 62 years of age or older (the older the better).
2. Must have at least 50% equity in their home.
3. Home must be in fairly good condition.
4. Home owners need funds to supplement their income, to rebuild an emergency reserve fund, or to complete desired home improvements.
5. The following link will help you locate reverse mortgage lenders, click on HECM check box: http://www.nls.gov/ll/code/llslcrit.cfm
6. The following link will help you locate HUD-approved reverse mortgage housing counselors (I am certified to do this counseling): https://entp.hud.gov/idapp/html/hecm_agency_look.cfm