Life After Bankruptcy

For immediate release February 16, 2011


Life After Bankruptcy

By Scott Heggs , Sr. Mortgage Originator

Baltimore, MD – Bankruptcy is an uncomfortable subject for a variety of reasons. The most obvious is the potential havoc it can wreak on your finances. Running a close second is the negative stigma which is often attached to the process. This negativity is important to mention because strong emotions can sometimes lead to unsound financial decisions with devastating results.

Bankruptcy becomes a viable option for someone who is “upside down” in terms of cash flow. In other words, when a person has more money going out each month than coming in, bankruptcy should be considered if no reversal of this negative cash flow is within sight. The longer someone waits to explore the various options available, the more serious his or her situation may become.

One of the worst things people can do in this situation is to borrow more money to try and pay off their debts. On paper, this is clearly an unwise financial decision. In the real world, however, it is very common for individuals to pursue this strategy in an attempt to buy time and hold off on filing for bankruptcy. On the surface, this is certainly a noble notion; however it can often compound the problem and serves only to delay the inevitable.

For many homeowners in the midst of this upside down cash flow, speaking to a qualified mortgage professional is a much better option. An experienced loan officer can objectively look at your finances and help you determine if restructuring your mortgage would not only help, but possibly even alleviate any need for bankruptcy.

If bankruptcy is the only option, seek out a reputable bankruptcy attorney and credit counselor. A qualified mortgage specialist can provide references for you as well, as he or she works with these professionals on a regular basis. Reliable references are essential in this case because experienced professionals greatly increase the odds of a successful bankruptcy experience. It’s that simple.

When filing for bankruptcy, be completely honest and accurate regarding every aspect of your financial situation. This includes any changes to your income which may occur throughout the process. Bankruptcy is a federal procedure, adjudicated by real judges, and scrutinized by representatives who coordinate with the Department of Justice, the FBI, and the IRS.

Here are some additional steps you can take to make the bankruptcy process as painless as possible:

• Save all paperwork regarding your bankruptcy, and keep it organized. This will prove beneficial after your bankruptcy as you now have all of the pertinent information in one place. Also, be sure to write down your discharge date. It’s surprising how many people forget to do this.

• Establish a household budget. This can be accomplished in many ways, but there are several inexpensive computer programs available which do an excellent job.

• Throughout the bankruptcy, do your best to not only live below your means, but to save as much cash as possible. You never know what you may need it for once the process is completed.

• Be prepared for a barrage of junk mail. There will be sharks on the loose who are hoping to capitalize on your need for credit.

Tips for Rebuilding Credit:

• If you must buy a car, focus on transportation as opposed to style. Buy an inexpensive, used car, and try to get a loan for it. It’s a good idea to figure out what your budget allows in terms of a dollar amount first. This means obtaining financing prior to looking for a car.

• Get a secured credit card. Secured credit cards allow for the cardholder to deposit a said amount of money into an account, thus establishing the spending limit of the card. Missed payments result in deductions from the account. Some of these cards will reward responsible borrowers by upping the limit without an additional deposit. Some will even convert the account into a traditional credit card. (Be wary of offers of “easy credit” or any card which asks you to call a 900 number. You will be charged for the call.)

• Meet with a credit repair specialist. Not only can they help you clean up the damage to your credit report, they can advise you on specific ways to rebuild the credit you lost as well.

While it does take time, there is definitely life (and credit) after bankruptcy. Some mortgage lenders will even lend to you within a year or so after a bankruptcy. If you’re in serious financial trouble, the trick is to get the help and advice you need from professionals you trust.

We recommend getting a quote from MortgageSeeker at http://www.mortgageseeker.net/

SUBMITTED BY:

SCOTT HEGGS

410-517-1930

410-517-1933

EMAIL: scottheggs@verizon.net

Nine Ways to Reduce Mortgage Closing Costs

Not only should you prepare for closing costs, you should also plan to negotiate them.


Closing costs are a hidden speed bump in the home purchasing process. Many people are so worn out at that point, that they just pay the closing costs and keep driving ahead at full speed. That’s exactly what many lenders and brokers hope that you’ll do.

Prepare for the closing costs before you get started and they’ll seem like just another part of the process. And the few hundred dollars you save will come in handy when the water heater breaks the first week that you move in!

Check out the following eight tips to start getting an idea of how to cut closing fee costs:

#1: Plan ahead: shop around and get estimates on closing costs from lenders before you get pre-approved for your loan. While you should ultimately look at the closing costs along with other factors like the interest rate , you’ll be able to get a ballpark figure of what they should be. Closing costs are generally 3%-5% of the total cost. If they are more than that, you can probably dismiss that lender.

#2: Simply ask the seller to share or pay for the closing costs. It’s worth a shot, especially in this economy. If the seller is motivated to close the deal quickly, he or she just might agree to it.

#3: Get a Good Faith Estimate. Your GFE is an estimate of how much the closing costs will come to. According to federal law, the actual individual fees can vary up to 10% from the quoted levels in the GFE. Study your GFE and contest or negotiate any suspicious fees (we’ll get to this in later steps). At least a day before closing, ask for you HUD-1 settlement statement. Make sure that this final tally of your closing costs matches the GFE and that no last minute fees have been tacked on.

#4: Ask your broker or lender to explain the closing cost fees to you. If you don’t understand what the cost is for, have them tell you. If you can’t get a good explanation, that’s a sign that the fee is inflated or unnecessary.

#5 Determine what fees are “trash” or “garbage” fees. Are there excessive documenting and processing fees? Lender’s inspection fees? Commitment fees? Assumption fees? Document preparation fees? These can likely be lowered or negotiated.

#6 Check to see how much you’ve been charged for the credit report. Are they charging you $150? It’s probably bloated. And if they are sneaking that one by you, there are likely others.

#7 Make sure that you haven’t already paid any of the fees. You’ve probably already paid an appraisal fee. Make sure that they aren’t charging you twice.

#8 Title Company fees. Lenders or brokers often have a partnership with a title company. Check out the fee and do a little research to see if you can find a cheaper title company to work with.

#9 If you are buying a home, ask the realtor on the seller side to reduce or waive their administration fee. If they want to sell the house bad enough many times they will do this. Also you can ask them to pay for some of your fees out of their commission like the appraisal or home inspection. If the sale is big enough they may well do this.

It may feel like you are at the mercy of your lender or broker when it comes to things like closing fees. You can’t forget, though, that the lender or broker wants the deal to close as much as you do. Remind yourself that you can walk away at any time and it will put you in a much better mental position to negotiate.

Start here to compare mortgage rates from top lenders in our network or just visit www.mortgageseeker.net