Seven To Ten

Seven out of 10 seriously delinquent subprime mortgage borrowers are still not getting the help they need to keep their homes, according to a report released Tuesday by state officials working to stem the foreclosure crisis.

“We’re still way behind,” said Iowa Attorney General Tom Miller, who helped form the State Foreclosure Prevention Working Group, a coalition formed last year by 11 state attorneys general and bank regulators.

The coalition is working with lenders and companies that service mortgages to try to keep people from losing their homes. It drew its statistics from 13 of the 20 major servicer companies, which handle about 58% of all subprime loans.

More than 1 million of those loans, or nearly 25% of the total, were delinquent as of Jan. 31. And foreclosure proceedings have begun on 300,000 of them - an 8% increase since October.

Mortgage servicing companies, which manage accounts and process payments, play a key role in efforts to help delinquent borrowers work out affordable mortgages. Workouts can take the form of simple repayment plans or more comprehensive loan modifications that involve reductions in balances or interest rates.

Many subprime loans are adjustable rate mortgages, meaning their interest rates jump after an introductory period. Borrowers who had not fallen behind on their payments before their rates reset can benefit from a simple freeze of their rates. Many subprime borrowers took out loans they could not really afford - making workouts more complicated.

The report showed that 28.5% of subprime adjustable rate mortgages that won’t reset until spring 2009 are already delinquent. About 21% of these same loans were delinquent in October.

In this day and age, businesses need immediate access to funds to seize opportunities when they arise. Banks are usually the first source for loans but if they would not fund your businesses, where do you turn to? Actually, there is still another avenue known as hard money lenders.

The frustrating situation with banks has led to the growth of hard money lenders who are ready to accept higher risks and extend loans immediately. A hard money loan is a real estate mortgage collateralized against the quick-sale value of the property for which the loan is made.

Interest payments may be higher than usual to protect the lenders’ interest considering most customers have bad or low credit. One of the best sources for nationwide hard money lender is LV Hard Money. They offer commercial as well as residential hard money loans.

You eliminate the hassle of conventional financing, need not worry about the brokerage charges, as they are direct lenders. They can help you stop foreclosure, and could also cash out refinances. Moreover, you will experience a prompt delivery of cash. The most impressive is that the purchase loan is based on your appraised value and not on purchase price.

All you would need to do decide, simply fill in their online form and they will do the rest. They would get back to you and guide you with the entire procedure. I browsed through the site, especially Florida hard money and found it very easy as a consumer.

During this period of credit crunch, it is no fun being deemed as a high credit risk. Even people with impeccable credit record are finding it tough to seek financing. For those in business, the stranglehold by banks is even more dire as cashflow is their lifeblood.

All is not lost though. You can visit BadCreditOffers.com which is a valuable resource for bad credit consumers. Their staff monitor the credit market daily for great “bad credit” deals and compile them for your reference.

With the help of this knowledge, you can now analyze the best offers which fit your needs, whether you are looking for credit cards, mortgages, auto loans, personal loans, etc. The evaluation is easy since you can compare features and details in each product side by side and then make an online application for your choice immediately. And don’t worry, the service is free.

Certainly, this will be better than applying for any offer which drops into your mail without knowing if it contains hidden time-bombs.

I believe there are many people now who have been classified into the group of bad credit consumers. The main thing is not to be depressed. If you are determined, getting back on your feet financially is possible. Start by discarding unnecessary spending habits and making payments on time, you can repair your credit and rebuild your financial future in a few years.

To rescue the economy and encourage consumer spending, the US government is printing more money and increasing federal debt. But the shadow of recession continues to loom large.

Monthly mortgage payments are rising as home values plunge. This double whammy has caused some homeowners to simply abandon their homes and their loans, rather than throw good money after bad.

New tax laws introduced last year have allowed home buyers to walk away from mortgage obligations without a tax consequence. Last time, if bank forgive the shortfall when the house is foreclosed, it is considered as income and hence taxable.

Is it alright for troubled homeowners to walk away when they can no longer afford their homes? I think if you choose to walk away, you have to accept that you’ll pay more for car loans, credit cards and mortgages in the future. At least for a while. I am worried that the hard lessons of greed are not learned if the exit strategy is so easy.

What do you guys think?