CALIFORNIA would prohibit the charging of advance fees to homeowners in connection with a loan modification, and require anyone who wishes to charge a fee for loan modification services (after performing them) to provide a state mandated notice beforehand regarding the availability of non-fee options for the borrower.
Tens of thousands of Californians face default and possible foreclosure if they are unable to negotiate a loan modification with their lender. A cottage industry has sprung up to exploit these borrowers, prey on their fears of foreclosure and their ignorance of the complicated foreclosure process. Loan modification “consultants” charge borrowers fees – often up-front and nonrefundable – for services available elsewhere free-of-charge.
Fear and desperation create a perfect climate for exploitation. By these scammers and there are many out there that will come in many forms.
Unscrupulous loan-modification consultants can be found lurking outside every mortgage fair, trolling for troubled borrowers. Their advertisements flood neighborhoods that have been hardest hit by foreclosure.
This was passed a couple of years ago, up until now I am still getting calls from many homeowners that they are paying some company to do their loan modification for them. Why, are we still in denial?
Remember these scammers will tell you what you want to here and then take your hard earned money.
Keeping your home is absolutely understandable and acceptable. But keeping a loan mortgage balance that you cannot afford is entirely different. We all have to be logical and realistic about what we want and what we can reach.
Simple calculation to what you should be able to afford, you should be paying only 38% of your net income towards your total mortgage payments per month. That total mortgage payments should include your taxes, insurance, principal and interest. Why 35%, because the rest will go towards your utilities, food, entertainment, kids etc… if you are very frugal with your life style you can sometimes go to about 50% but a target number should always be around 38%.
For example and typical husband and wife making about $ 80,000.00 a years which is about net of $ 4800 a month in income. Your mortgage payments PITI should not exceed 38% which is about $ 1823 a month. You will then have about $3000.00 left for all your other expenses. If like most you have two children in public schools, a family of four will typically have a total utility bill of about $ 450 which includes our Filipino Channel and one phone line. Another phone line would be another estimate of $50.00. then you have your gas and auto maintenance of about easy $500.00 for two vehicles. Your kids school, supplies, clothing, activities and food would run you about easy $300.00 each. We are now at a total of $ 1,600.00. Now, our groceries would run about $400 if you are eating home maybe 5-6 days in a week and then your weekend dinning at regular restaurant about $250.00 a month. This will be at a total of $2250.00 in expenses, you have about $750.00 left for miscellaneous expenses and your retirement for your future.
So, for some homeowners that are not properly doing their expenses monthly. You will be lost in reality and think your net income of $4800.00 would actually allow you to have a mortgage of $3500 a month which is 72% of your net income. This will not be sustainable and if your using your reserves to funds the deficit, you will have to have a large savings account.
Our job market is improving, the medical field is showing signs of recovery for most people in Healthcare jobs, you should be fortunate. But depending on age of workers not everyone can maintain two full time jobs to support a large mortgage payment.
Recently I experience a close family member that passed away. Sometime it takes something bad to happen in order for us to realize the importance of our lives and family. I am hoping I can help some more people understand that they no longer should work for a mortgage but for a family. Life will be short and fast so if we don’t savor it, it will be gone.
I want to make you realize that every situation has a solution, you are not alone and there is definitely nothing to be embarrassed about. Don’t keep these problems within and carry the burden. You need to talk to someone to resolve these problems. The solutions may or may not fit your thoughts but they are nevertheless still a solution. Don’t find an answer that is not there, be educated and be accepting.
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Thanks again for your inquiries, please call Ken Go of 1st Innovative Finance Group at -562-697-7028 or write to[email protected].