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Where can I turn for debt help and advice?

January 21st, 2011


Where do you turn for advice when your debts have got out of hand? It’s something many of us will wonder at some point in our lives, and it’s important to take action fast if you find yourself in this situation.

As a rule, if you find yourself struggling with debt, you should contact your lenders immediately to explain the situation. They’ll want to help you – after all, it’s in their interest as well as yours that you find a way to repay your debts.

In some cases, you might be able to come to some kind of alternative agreement for repaying your debts. They may allow you to make smaller payments – or even make no payments at all (known as a ‘payment holiday’) – for a while, to allow you to get your finances back on track. Just make sure you understand all the potential consequences before you agree to anything.

However, if you can’t come to an agreement with your lenders, it’s time to talk to a debt adviser. In fact, many people choose to talk to a debt adviser first, so they feel as well prepared as possible when they contact their lenders.

How can a debt adviser help?

It’s a debt adviser’s job to help you find the best way of clearing your debts.

This doesn’t always have to mean a change in the way you repay your debts. Your debt adviser might be able to help you spot areas in which you can cut back to make ‘room’ for your payments, or they might help you draw up a budget plan so you can run your finances more efficiently.

Or your debt adviser may be able to recommend a debt solution that could help. There are debt solutions designed to help with almost any kind of debt – even if you don’t think you’ll ever be able to pay your debts off completely.

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A cure for ailing credit

April 24th, 2009

Credit has become a much-used word, thanks to the various connotations that it is being used in. Transactions in which the payment is deferred to the near future are termed as credit transactions.

Ever thought why the grocer sells goods on deferred payment- because of a good credit that you enjoy. Credit is the reputation or standing that a person has in the society. Though credit includes various non-financial aspects, our study primarily includes the financial aspect.

The lending community watches every financial transaction of the person in question with its hawkish sight, and classifies the cases from excellent to worst. One cannot be sure of staying on a particular credit rating for a long time, owing to the volatile nature of the credit reports.

A single instance of default or late payment can tarnish the credit for a long time. Having contracted bad credit once, you would always find yourself facing the same situation, unless some serious efforts are taken to get out of the muck.

Do you think that the issue is insignificant to your case? Think again. Checking with your counterpart having a good credit rating will reveal the higher rate of interest being charged by you. The reason for this extra charge is a bad credit tag that accompanies your credit report. It will be much easier for a person with good credit to get a loan than for a person with bad credit.

These and many more reasons make credit repair a priority.

First check the credit report. Every person who has ever indulged in credit transactions will have a credit report prepared by the credit reference agencies. A person can apply for a credit report within 60 days of receiving the bad credit notice. Make a note of any discrepancies in the credit report. There are many debts that you have not incurred but are present in the credit report. Many trivial matters like divorces, lawsuits etc affect credit. It will thus be important to see that even the smaller discrepancies are not overlooked. Credit report must be regularly checked to fix such small discrepancies within time. This will also help trace identity theft on your account. These must be fixed immediately.

The paragraph above dealt with entries in the credit report not conforming to the person. Next, we deal with the case when there actually is a debt that has not been paid. The debt must be paid up as quickly as possible. Delay beyond a month will make payment inconsequential because the credit reports will incorporate the defaults, thus making the bad credit irreversible for a period of about six years.

Credit counseling will be beneficial for people who are not much aware of the various options available to them. Various credit-counseling agencies are available on the net and on phone. They even conduct personal meetings with the clients. After having a chat on the problem being faced by the client, they suggest viable solutions. However, the client can refuse using the solution if they do not find it useful.

Prevention is better than cure. Certain steps may be taken to prevent credit rating from worsening. Only a few loans must be taken. The number of debts will vary with the income capacity of every individual. Regularity in payments will also have a positive impact on the credit rating. A considerable time gap must be maintained between any two loans . Having too many loans with a shorter repayment period can have serious repercussions for the finances. This too will affect the credit rating.

These will not clean up the credit report altogether, but will at least help to make a small dent in the bad credit history. With a concerted effort over a period of time, the credit history will transform.

Bad credit has serious repercussions for the individuals. They are refused loans by most of the lenders. This article explains the various methods to repair the credit history. It also gives tips have been provided to keep the credit rating from falling.

James Taylor holds a Master’s degree in Commerce from JNU. He is working as financial consultant for Chance For Loans. To find debt consolidation loans, debt consolidation loans, cheap rates, personal loans, secured loans, unsecured loans, improvement loans

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Souring FHA Loans

March 9th, 2009

Well, that didn’t take long. In November, BusinessWeek had a big cover story on the way in which dodgy subprime lenders were moving into the formerly safe-and-boring world of FHA loans. And now the shoe is dropping:

In the past year alone, the number of borrowers who failed to make more than a single payment before defaulting on FHA-backed mortgages has nearly tripled, far outpacing the agency’s overall growth in new loans, according to a Washington Post analysis of federal data.
Many industry experts attribute the jump in these instant defaults to factors that include the weak economy, lax scrutiny of prospective borrowers and most notably, foul play among unscrupulous lenders looking to make a quick buck.
If a loan “is going into default immediately, it clearly suggests impropriety and fraudulent activity,” said Kenneth Donohue, the inspector general of the Department of Housing and Urban Development, which includes the FHA.

Annoyingly the WaPo story can’t find space in almost 2,300 words to ever tell us the rates at which FHA loans are souring: we’re told that the immediate-default rate has “nearly tripled”, for instance, but we’re not told the absolute default rates. The closest we get is this:

More than 9,200 of the loans insured by the FHA in the past two years have gone into default after no or only one payment, according to the Post analysis.

I haven’t been able to work out where the FHA reports the total number of loans that it originates; the best thing I’ve found so far is this chart, showing FHA originations rising from about 60,000 a month in January 2008 to over 140,000 in August. So very roughly I’d guess that over the past two years the FHA has insured about 2 million loans. If that’s the case, then the immediate-default rate is about 0.5%. But some hard numbers would be very welcome here.


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Wexler Supports Bill Empowering Homeowners and Encouraging Lenders to Refinance Mortgages

March 3rd, 2009

lowers fees paid by borrowers and lenders, and provides ,000 payments to servicers for each successful loan REFINANCING. Congressman Robert Wexler is Chairman of the Subcommittee on Europe and a senior member of the House Foreign Affairs Committee and

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