Loan Modifications

With 800 Billion Dollars of Adjustable Rate Mortgages still coming up for reset in 2009 and beyond, getting them modified will be necessary in order to stop another round of foreclosures.  Although the Federal Government has encouaged lenders to modify these problem loans, most borrowers are not getting a permanent solution to their mortgage problems. Due to this on-going situation, many law firms throughout the United States are specializing in loss mitigation and representing borrowers to help them get favorable modifications from the lenders.  With overnight bank rates being set at almost zero by the FED, the spread is now favorable to modify most of these problem loans and still make good profits.  All that needs to happen is for the mortgage consumer to understand that these services and help are out there for them.

Best ROI paying off debt.

In this economic era of stagnant income and property equity growth, many financial experts are looking at the Return on Investment of paying off debt.

What many are suggesting to their clients is since debt service interest payments are paid with after-tax-dollars, by paying off debt and saving the interest payments ranging anywhere from 6%, 18% or even 28%, you guarantee saving the equivalent of those payments as earnings AFTER TAX.

When you compare this financial return from debt reduction with any type of guaranteed investment opportunities available today, it is very unlikely anyone will find anything that will guarantee 28%, 18% or even 6%.  It is the simple truth and why paying off debt is such a good ROI for almost all consumers today.

Eliminating Debt is FIRST STEP to Financial Freedom

For the last 25 years or so, the popular 30-Year Fixed Rate Mortgage has probably been the most important factor in fueling the just completed housing boom. By amortizing payments over 30 years, it lowered monthly mortgage payments to the point where it opened up the housing market to millions of first time home buyers that otherwise may have not been able to enter the market.   That’s all good right?

Well lets look on the other side of coin as to what it has done to the mentality of consumers today. 

I am speaking of the mentality of millions of purchase decisions being made each day on the basis of “how much is the monthly payment and can I afford it with my monthly income.”  Millions and millions are living pay check to pay check making monthly payments with no hope of ever getting out of this abyss of debt.  Paying large portions of monthly income to interest finance charges that escalate and eventually force people into life styles they did not intend to ever be in.

Am I saying using credit is always bad?  Absolutely not.  Leveraging the banks money for a home or car is neccessay for almost everyone. Using a credit card for a 30-Day float is a wonderful tool. Getting in debt and allowing it to accumulate with no plan to get out is where the mistake is made.  There is absolutely no way to ever accumulate the kind of wealth needed to pay for the things most people want or look forward to unless they get out of debt as quickly as possible in life.

More and more financial professionals are seeing the light and are offering strategies for their clients to get out of debt and help them accumulate the maximum amount of wealth at a much earlier age.  Look for advisors that speak this way.  Run for the exits if you get advice that debt is good and cash is bad.  That is definitely an old school strategy that did not work for millions.