Financial Distress Help & Support Thread

[Offshore-Wealth.com]

I wish refi's were that easy. I have over $200K equity in my house and can't get any one to refinance me. So final decision is to put it up for sell. It's way too big anyway. The last of 5 kids graduates in a month and it will just be me and hubby. I'd almost rather cut off my right arm than sell but we can't afford it anymore. $8000 in taxes every year plus the note and utilities put us in a very uncomfortable place.
So having said that anyone interested in a Texas hill country stone and cedar house with 5 bedrooms and 6 1/2 baths, 3 car garage with a game room on 2 3/4 acres, PM me!! Oh yea, the taxes are really only $800!!

Interesting,

I have been a mortgage broker for years and Texas is the toughest state to get a mortgage in, but with that kind of equity, I am amazed you cannot find someone within state to refinance you, even with so so credit. As we have seen in this thread, there are many variables to consider, and no one answer will work for everyone, so it is nice to see these posts are helping others deal with their situations. It is always tough to sell our long time homes, so I can relate to what you are saying as I downsized a few years ago as well.

Good luck and health to all, MIke

[Bill]

Well offshore would you invest in realestate or just for a bigger house.

[TEXASGIRL]

Interesting,

I have been a mortgage broker for years and Texas is the toughest state to get a mortgage in, but with that kind of equity, I am amazed you cannot find someone within state to refinance you, even with so so credit. As we have seen in this thread, there are many variables to consider, and no one answer will work for everyone, so it is nice to see these posts are helping others deal with their situations. It is always tough to sell our long time homes, so I can relate to what you are saying as I downsized a few years ago as well.

Good luck and health to all, MIke

Thanks Mike. We know we have made the right decision. We are looking at a historical home in a small town. It's the perfect place for us. I'm starting to get excited about our new future, right after I get over the empty nest!!

[Offshore-Wealth.com]

Do this and you can do almost anything. About 4 years ago I made alot of money selling my house and land (and the horses ) and paid off everything I had cause of fixing to get a Divorce.

Any ways we worked it out after the sell. And rented a House in town for a Year. When we went to Buy again, I learnt since I paid all my bills off and had no revolving accounts that this was worst then Bad Credit. What kind of math is that.

Anyways we got a house in that sub-prime market. Got Interest Rate (7.3) but had to do a adjustable rate after the first 2 years. Which was up last month. I started early looking for a Mortgage company when the time came and to my surprise my rating was still middle. I wanted the Historical lows of todays Interest on this house.

So I hired the Lady about 60 days ago. She isnt cheap but she is good. ($500.00 down and $89.00 a month until done.) My credit Scores are all there in the 700's. Went up over 100 points in each Reporting Company and I just got my call today of when I can close on a 5.25% Mortgage. Just 60 days ago I was looking at 10%.

I want post it here, but if anyone would like this ladies info, just send me a PM and ask for Deanna's info Plaese. I will be more than happy to hook you up. My Dad always said, "A Poor Man is Poor, But a Poor man with out Credit is Worst-Off".

Once you get your rating where it needs to be. Take care of it. Dont buy what you don't have to have. And Paying cash is not always the best advise.

Good point,

Today credit scores are more sensitive than years ago. It use to be that less debt increased your scores, now if you don't have any debt you are penalized, as I too found out recently. Having been in the mortgage industry for years, I can say without a doubt Neno's situation is consistant with what I have seen and experienced.

As to improving scores, there are many strategies one can use to increase FICO rating, but you have to know what the lenders want to see, and it is not a debt free record, that is for sure. They rather see you in debt up to your eyes, as long as you don't miss a payment due date. I closed credit cards and paid them off and found my scores drop by 80, and years ago this would not have happened, so the system is much different now, so beware, don't close your accounts if you are going for a mortgage.

Good luck and health to all, Mike

[azmia]

Don't speak out of place. You don't know what circumstances have put them in the place they are. That was rude.
PLease read the title of the thread. The word SUPPORT mean anything to you?

Exactly, financial situations can happen to anyone. It use to be that 3 months worth of savings would keep you out of harms way. Not any longer. Unplanned situations happen to everyone, but those of us who have had major setbacks, not because of our spending habits, but because of situations out of our control, end up on the short end of the string. With the costs of medical insurance now, most people have no or sub-standard medical protection. Catastrophic illnesses will wipe out a nest egg very fast.

As one poster stated, there are those out there who declare bankruptcy for 10k worth of bills. That was never what that program was set up for. It was to help those who are truly in need find some relief in their situation. The 'unspoken' penalties which credit companies put on you years later, are unfair, and unjust. While your FICO score is everything to a banker, there is no room for an explanation of what really happened to cause the situation to being with. If you need to apply for credit, you will usually end up with a form letter stating that your credit was denied.

Not everyone has bad spending habits, as I posted before and rvalreadydang, No offense intended, there are those people out there who through no fault of their own end up in a situation similar to yours. I guess I should have continued on my post a bit more. So sorry.

Yes, canceling credit cards is the fastest way to see your Fico score fall. But using them to the hilt is also another way to watch it fall, and to find yourself in a bit of a problem situation. If you notice the more you use your CC the higher your balance will begin to climb. Especially if you are paying more on your cards than the minimum. We actually had to call the bank and tell them to take an increase off one of our CC when it got up to 8k. That is way too much to owe any blood sucking institution, that charges usury interest rates.

[rvalreadydang]

Exactly, financial situations can happen to anyone. It use to be that 3 months worth of savings would keep you out of harms way. Not any longer. Unplanned situations happen to everyone, but those of us who have had major setbacks, not because of our spending habits, but because of situations out of our control, end up on the short end of the string. With the costs of medical insurance now, most people have no or sub-standard medical protection. Catastrophic illnesses will wipe out a nest egg very fast.

As one poster stated, there are those out there who declare bankruptcy for 10k worth of bills. That was never what that program was set up for. It was to help those who are truly in need find some relief in their situation. The 'unspoken' penalties which credit companies put on you years later, are unfair, and unjust. While your FICO score is everything to a banker, there is no room for an explanation of what really happened to cause the situation to being with. If you need to apply for credit, you will usually end up with a form letter stating that your credit was denied.

Not everyone has bad spending habits, as I posted before and rvalreadydang, No offense intended, there are those people out there who through no fault of their own end up in a situation similar to yours. I guess I should have continued on my post a bit more. So sorry.

Yes, canceling credit cards is the fastest way to see your Fico score fall. But using them to the hilt is also another way to watch it fall, and to find yourself in a bit of a problem situation. If you notice the more you use your CC the higher your balance will begin to climb. Especially if you are paying more on your cards than the minimum. We actually had to call the bank and tell them to take an increase off one of our CC when it got up to 8k. That is way too much to owe any blood sucking institution, that charges usury interest rates.

no offense taken i just wanted to clarify my situation....as for cc whatever her name is, no comment

[Offshore-Wealth.com]

Well offshore would you invest in realestate or just for a bigger house.

Good question,

Real estate over the long term has always produced a good return on your investment, even without the personal home benefits, so yes, investing in real estate is always a good strategy, but timing is important, and that is what I am waiting on, the new bottom, and it will be worth the wait, so hang in there, don't be making any purchases just yet. Many smart home owners are selling now, will rent and wait out the bottom, so be patient, not that most of us are not already conditioned to being patient. (g)

Good luck and health to all, Mike

[Offshore-Wealth.com]

Exactly, financial situations can happen to anyone. It use to be that 3 months worth of savings would keep you out of harms way. Not any longer. Unplanned situations happen to everyone, but those of us who have had major setbacks, not because of our spending habits, but because of situations out of our control, end up on the short end of the string. With the costs of medical insurance now, most people have no or sub-standard medical protection. Catastrophic illnesses will wipe out a nest egg very fast.

As one poster stated, there are those out there who declare bankruptcy for 10k worth of bills. That was never what that program was set up for. It was to help those who are truly in need find some relief in their situation. The 'unspoken' penalties which credit companies put on you years later, are unfair, and unjust. While your FICO score is everything to a banker, there is no room for an explanation of what really happened to cause the situation to being with. If you need to apply for credit, you will usually end up with a form letter stating that your credit was denied.

Not everyone has bad spending habits, as I posted before and rvalreadydang, No offense intended, there are those people out there who through no fault of their own end up in a situation similar to yours. I guess I should have continued on my post a bit more. So sorry.

Yes, canceling credit cards is the fastest way to see your Fico score fall. But using them to the hilt is also another way to watch it fall, and to find yourself in a bit of a problem situation. If you notice the more you use your CC the higher your balance will begin to climb. Especially if you are paying more on your cards than the minimum. We actually had to call the bank and tell them to take an increase off one of our CC when it got up to 8k. That is way too much to owe any blood sucking institution, that charges usury interest rates.

Good point,

Everyone will face unexpected financial situations at some point in their lives, so being prepared is critical. We live in a time where savings are at an all time low, if not non-existant. This is especially true with younger consumers, so let this be a lesson to those who have not yet experienced the stress of a financial crisis, job loss, health, college costs, etc., no one is exempt from unexpected losses, no matter how careful they spend.

The issue that bugs me the most is what you stated in your last paragraph. These credit card banks are leaches, and we are all paying way too much on credit card interest and fees. They have force fed consumers a steady diet of credit cards for years, and when the economy goes down the toilet, their profits go through the roof on late fees and higher interest rates. What everyone need to do is pay off credit card debt as a priority, keep one main card for emergencies, but people most break this habit of using their credit cards for everything, unless you are disiplined enough to pay off your balance every month, which sadly, few are.

What most people don't yet realize is that credit cards are designed to be lifelong debts where you will end up paying thousands in interest without making a dent in the principal paying the minimum each month. The average credit card balance will take over 20 years to pay off when paying the minimum, and many will take over 30 years to pay off is you continue to charge, charge, charge. I am still amazed that most people are now aware of this credit card trap and are needlessly paying three times or more what the borrowed because of it. Like a mortgage, you pay mostly interest, and this is how credit cards are set up now, so BEWARE, resist using those credit cards or you will be trapped for life.

Good luck and health to all, Mike

[POLEBARGE]

Good point,

Today credit scores are more sensitive than years ago. It use to be that less debt increased your scores, now if you don't have any debt you are penalized, as I too found out recently. Having been in the mortgage industry for years, I can say without a doubt Neno's situation is consistant with what I have seen and experienced.

As to improving scores, there are many strategies one can use to increase FICO rating, but you have to know what the lenders want to see, and it is not a debt free record, that is for sure. They rather see you in debt up to your eyes, as long as you don't miss a payment due date. I closed credit cards and paid them off and found my scores drop by 80, and years ago this would not have happened, so the system is much different now, so beware, don't close your accounts if you are going for a mortgage.

Good luck and health to all, Mike

There is good news out there for credit scores. Mike may know of this being in the finance business also. There is going a new way the credit bureau's score our credit. It is called Advantage score. It was to have come out this fall but who knows. It is going to put things in better light than the current system that truely make little to no sense. NENO yes paying off all debt and closing everything can lower the score along with total inactivity. If you are not paying some sort of debt your score drops cause it shows maybe you cant pay it. LOL STUPID isnt it? You can also take measures on your own to increase you credit score.
Everyone has seen the mycreditreport.com and other sites. On these site you can view and look at your report. They will not give you score unless you pay for it. What you can do is look and disput accounts. I have taken friends who had bad credit shown them how to disput the accounts on their credit report and also risen their own score by 100's of points.
THe loop hole in the credit sysytem is that a creditor has 30 days to get back in touch with the credit bureau and update the account info. If you have a Capital one card and lets say it is past due and charged off. Disput the account online to the 3 bureaus and just put in the disput box not mine. Mark on your calendar when you did this. 30 days from that date do it again, and again, again and again. Sooner or later Capital one misses that 30 day window they have (Capital one responds to millions of these in a month that yes they miss some all the time). As soon as Capital one does not get back to the creidt bureau if falls off of your report.
I am currently working on a friends report and trying to get a PREFECTLY paid account taken off. If so........ I will let you all draw your conculson on that statement.

The other major thing to remember about credit scores is this. Do not take your credit card balance over 50% of the limit. That is a major hit. Stop rolling from 0% to 0% cards. This to is bad. It shows a ton of open accounts but also that you can only pay on something for 1 year. The bureau scores off of revoling credit, limits, installment loans and balances, and length of time on all accounts. If you have 5 credit cards and you only use one close the card you had the least amount of time. Also Citifinicail and Benificail loans are kind of bad. Most places know the type of lenders these are and a red flag goes up. I hate to say it for those that have these types of loans but I am not judging just giving info.

Originally Posted by cccchrissy
Many of you with bad credit need to lok at your character. YOU made your choices. You borrowed. Pay it back

I agree with the above statement, IF AND ONLY IF you truely was reckless and did it to yourself. For those that have lost their great paying job, or medical bills, I feel for all of you. But there are people that have to KEEP UP WITH THE JONES'S and those I do not feel for at all.

[azmia]

What most people don't yet realize is that credit cards are designed to be lifelong debts where you will end up paying thousands in interest without making a dent in the principal paying the minimum each month. The average credit card balance will take over 20 years to pay off when paying the minimum, and many will take over 30 years to pay off is you continue to charge, charge, charge. I am still amazed that most people are now aware of this credit card trap and are needlessly paying three times or more what the borrowed because of it. Like a mortgage, you pay mostly interest, and this is how credit cards are set up now, so BEWARE, resist using those credit cards or you will be trapped for life.

What is even more disturbing for me is the fact that Bank of American has begun a new program in the West, no doubtedly aimed at the lower income families who could not qualify for CC (credit cards), because of their limited income, they are now lowering their requirements, and accepting applications 'without' the need of social security numbers, in an attempt to 'help' those who otherwise would not be able to obtain a Visa or Mastercard. To me it is a blaintant attempt to walk away from their financial responsiblity when the program has a million more families who can't afford to pay their high interest charges, and BOA will look towards the government (us) to foot another bill when it does happen.

Usury rates combined with the true inability to pay off maxed credit cards are going to be a true problem.

Last information I had on this was that there is a senate group looking into it, but it was several weeks ago and since then information has gone 'cold'.