Letter of Hardship: How To Write A Hardship Letter

House Passes Bill 2346 to Help Military Families Facing Financial Hardship

Matt O'Hern — Mon, 18 May 2009 13:27:00 -0500

The U.S. Congress just passed a bill that provides $96.7 billion to cover "neccesary costs to fund troops overseas and support their families, including stop-loss compensation.
According to an article on newsblaze.com, $17.9 billion of the measure includes personnel costs for each branch of the armed services, including the increased monthly rate of imminent danger pay, family seperataion allowances, hardship duty-location pay and additonal funds for basic allowance for housing.

Cancer and Other Serious Illnesses are Considered Medical Hardships

Matt O'Hern — Mon, 13 Apr 2009 15:42:00 -0500

You may be one of millions of Americans who suffers from a life-threatening or dehabilitating disease such as mesothelioma, a cancer caused by asbestos, or some other form of devestating illness.

These horrible diseases bring enough mental and physical pain for a family to deal with, and a mortagage should be the last thing on your family's mind. Consider writing a well phrased medical hardship letter if you or the providor of your household income is bed-ridden due to disease or another medical reason.

Safeguard Your House to Prevent Another Disaster

Matt O'Hern — Wed, 08 Apr 2009 11:29:00 -0500

I was startled awake from my sleep this morning when I realized that the LOUD beeping sound wasn't my alarm clock, it was my fire alarm low battery alert. I swapped out a new C battery and wondered how many homeowners may not have one of the low-battery notifiers on their fire alarm.

Obviously, if you're on this site, you're pinching pennies, but never let your finances overshadow your family's safety. When your house is on the brink of foreclosure, the last thing you need to deal with is another crisis.

Foreclosure Families are Victims of Circumstance

Matt O'Hern — Mon, 06 Apr 2009 13:42:00 -0500

We all like a good deal. During the peak of the real estate market, almost every house seemed like a best buy because we were convinced the market was just beginning its ascent.

Unfortunately, short-sells and flips only went so far before the market started to correct itself. While many investors purchased houses for the sole intent of making profit, millions of Americans were simply starting their dream.

Your letter of hardship should explain how a circumstance beyond your control spoiled your original dream. Stress the efforts you've made just to make ends meet, and appeal to the reader on a professional yet personal level.

Cut medical expenses with personal fitness and other preventative care

Matt O'Hern — Fri, 27 Mar 2009 10:16:00 -0500

Hardships aren't limited to layoffs or paycuts. Medical bills can drastically cut or eliminate your disposable income, forcing your family into debt. No immune system is perfect, but there are simple steps you can take to decrease your risk of costly medical procedures involving diabetes and heart problems.

A daily exercise regimen and a healthier diet can prevent a medical disaster. You should also consider a daily intake of vitamins and a weight loss supplement , but be sure to consult your doctor before you take any pills or start a new workout routine.

Beware of cash for gold, cash for jewellery offers

Matt O'Hern — Tue, 24 Mar 2009 11:32:00 -0500

Desperate times call for desperate measures ,and many Americans are faced with home foreclosures and other outstanding expenses.

As a result, they may be searching for any means of income,even if it requires them to sell a personal item. Websites such as cash4gold.com offer instant cash for expensive items such as diamond rings and other jewelery, but the Better Business Bureau is advising consumers to avoid cash4gold due to the high volume of complaints they've received.

Include Examples of Personal Items You Sold to Make Ends Meet

Matt O'Hern — Fri, 20 Mar 2009 13:34:00 -0500

If you're trying to appeal to emotional senses, you may want to consider a list of the efforts you've made to ensure you and your family's well being. For example, many American's have resorted to selling prized possesions and heirlooms. If you've strapped for cash to the point that you're selling everything, from patio furniture covers to personal items, you may want to make a formal list with personal items.

Personal Letters Are More Effective than E-Mail

Matt O'Hern — Fri, 20 Mar 2009 13:30:00 -0500

Bruce Silverman, author of "How to Complain for Fun and Profit," , advises consumers to take the time neccesary for printing out your letter and mailing it to the executive or department you want to reach.Silverman insists they were effective because physical letters stand out, while emails get lost in the clutter.

He was interviewed on ABC's 20/20 and was given three frustrated consumers.

One man was frustrated with his airconditioning contract with Sears, another was a young woman upset about her mobile phone malfunctioning, and a young man couldn't convince GameStop to replace a damaged PS3 they sold him.

After each of them took the time to personally mail the letters, the companies eventually resolved their problems.

Kettlebell Workouts Are The Bomb!

Stu Randall — Wed, 18 Mar 2009 00:15:00 -0500

One of the most important life lessons I've learned in my time on this planet is that you can't have a positive mental attitude unless you feel good about your body. I don't mean that you have to be anorexic or a marathon runner or body builder or on the cover of GQ. I simply mean that you can't expect to feel good inside if you aren't maintaining your level of physical fitness. On a whim I recently took up Kettlebell training and have had phenomenal results. I went from a size 38 waste to a 32 in 6 weeks. I've only lost about 10 pounds, but I've lost more inches that I ever could have imagined. I have mostly lost inches in my waste but my thighs have gotten smaller (and firmer) and my chest and back have really firmed up a swell. Like I said though, you've got to do something to stay fit and kettlebells are doing it for me and you have to find something that works for you.

Credit Cards and Their Role in The Economic Crisis

Admin — Wed, 11 Mar 2009 13:36:00 -0500

In 1995 a historic event occurred that aroused little interest with popular media, yet the long term effects of this milestone have transformed our society. In 1995, for the first time ever, Americans starting paying for purchases with little plastic cards more then cash. Plastic overtook coins and folding money as the payment of choice.

Consumer credit has been around since the early 19 th century. Companies such as Sears, Roebuck and Company were some of the first to lend money to the working man. These early credit cards were called merchant or retail cards, and were issued by the same companies that sold the goods.

During the mid-1960s MasterCard and Visa were established and banks started issuing these all-purpose cards. By the 1990s the all-purpose credit card reigned dominant over traditional store cards, and made it possible for consumers to charge anything from vacations to children's braces.

Credit cards have become so pervasive in our lifestyles it has become extremely difficult in some instances to use cash as a result. Try reserving a room, rent a car, or even order a pair of shoes without one.

Credit cards have become all too easy to obtain. Consumers are inundated with offers through the mail, newspaper flyers, and even in places previously unheard of. Visit some doctor and dentist offices and you'll likely see credit card applications conveniently placed within arms reach. Simply put society has become saturated with credit card offers.

For middle-class America credit cards are a way of life. Increasingly they no longer pay - they finance. Americans have taken to buying groceries and everyday consumables with debt - and financing those items over months or even years. This disturbing trend is only growing and adds to the already fragile economic situation.

Today more and more households find their monthly credit card balance is out of control. Even those credit card holders holding steady jobs and showing good payment history are in serious trouble as they use credit cards to take on more and more debt. A new practice by consumers is borrowing from one card to pay another until the whole situation has spiraled out of control often leaving the homeowner facing possible bankruptcy . As this slide towards financial oblivion occurs people are also discovering they may have no way of stopping foreclosure on their homes.

Credit cards, like life, come with their own slings and arrows. Their seductive influence has changed our mindset about spending. Runaway spending has become an all too common way of life and all too often leads to financial disaster.

Our predecessors understood that hard times often called for hard decisions. The time is at hand for the consumer to make the hard decision of salvaging their finances by reducing or altogether eliminating credit card use. Consumers making the right spending decisions will likely ride out the looming crisis. Those refusing change stand a very real chance of losing it all and ending up with little more than the clothes on their backs.

The Bankruptcy Epidemic

Admin — Wed, 11 Mar 2009 13:34:00 -0500

One cause for bankruptcy filings is less obvious than others. Home mortgages are a large and important sort of debt for most, but buying a home is not what causes bankruptcy. The main culprit is change. Since the late 1940's we have been taught that owning our home is a smart investment, provides long-term financial security, along with the added social acceptance and a nice tax break.

Fast-forward to today and we discover rising interest rates, stagnant incomes, higher property taxes, and other increasing housing costs making home ownership a greater risk for people who can no longer be sure of income stability.

Home ownership, combined with the need to follow the jobs, taking out second-mortgages to pay for college tuition, braces, and a stagnant or declining housing market have combined to move owning a home into the liability column in the family balance sheet. Another recent and alarming trend is the rise in using second and third mortgages to pay off credit card debt.

Homeownership remains one of our most visible signs of respectability and acceptance into society. Families in bankruptcy often want desperately to keep their homes and stop foreclosure. Their bankruptcy filings are often an attempt to eliminate other debts so they can redirect their shrinking incomes into their mortgage payments. Hanging onto a home may no longer make sense economically. Many struggle to hang on and save this important part of their lives when all the signs are telling them to let it go.

Change, as mentioned previously, is also the answer to reversing the growing bankruptcy trend. Unfortunately change is not always easy or readily accepted by some. People become comfortable with homeownership, and their new position in society. Human nature being what it is causes us to resist anything that may disturb our status quo, or literally "the way things are".

Those who embrace the idea they must make needed alterations to their spending and lifestyle habits will likely manage to weather the current economic uncertainties. Those who ignore the signs may likely lose it all.

The Effects of Foreclosures On Our Economy

Admin — Thu, 05 Mar 2009 11:40:00 -0500

A recent study by First American Corporation of Santa Ana, California predicts some 1.1 million people will likely face losing their homes to foreclosure during the next 6-7 years. Adjustable-rate mortgages which were so tempting during the real estate boom are the primary cause for the expected losses.

Putting this to a dollar amount reveals lenders taking about a hit for over 112 billion dollars. This amount is greater than the Gross National Product for most countries, yet U.S financial experts predict the economy should be able to absorb the loss since it represents less than one-percent of the expected $12 trillion in new home mortgage loans projected over the same 6-7 year time frame.

While this is good news for the country and the economy it does little to lessen the stress for those million-plus homeowners unable to stop foreclosure on their homes.

What is the current foreclosure situation? Another foreclosure record was broken recently as another 286,000 foreclosures were filed during the third quarter. Once again these record numbers were driven by a handful of states - California, Florida, Nevada and Arizona. In fact the foreclosure numbers across the country showed an overall decrease if you don't take those four states into consideration.

The challenge for a homeowner to avoid foreclosure has become even greater now that more stringent measures have been set into place to prevent another out of control boom real estate market like the one that gripped the nation between 2003 - 2005. Because credit availability has been constrained, refinance options are limited for borrowers. All these factors work against homeowners barely keeping their heads above water as it is. Worse yet is that as time passes the possibility for stopping foreclosure will become harder still.

The allure of homeownership and the greed of some lenders combined to make to make this one of the most tumultuous real estate markets in his

Negative Entries On Your Credit Report

Admin — Thu, 05 Mar 2009 11:38:00 -0500

Believe it or not your credit is susceptible to any number of factors beyond your control. The point is nobody's perfect, and neither is the average person's credit report. Anybody recall the summer a few years ago when Florida was hammered by what seemed to be an endless succession of hurricanes? Do you suppose those natural disasters might have slowed down the mail service, and perhaps causing some payments to be late? You bet it did, and this simply an illustrates what I'm talking about.

There any number of legitimate, and illegitimate, reasons for negative entries to show up in your credit report. Do you think lenders and creditors are perfect? Not for a minute. With billions of bits of information flying around it is only logical for honest mistakes to happen. This being said it proving extremely difficult to obtain the lofty status of "perfect" credit.

There are very few people who have what is considered "perfect" credit, or a FICO score of 850. In my previous career I saw this score only once. Lack of perfection is much more commonplace, and as long as your credit report shows more smooth sailing than rocky shoals you should be eligible for plenty of loans at competitive rates.

By now you are probably saying "Well that's all well and good, but just how many bumps can my credit report tolerate before it moves into the danger zone? How long does the negative information remain? How do lenders interpret this?" Bad credit typically stays on your credit report for seven - ten years, depending on your state of residence. Lenders use a complex formula to determine your risk factor.

The long and short of it is if you have a lot of information on your credit report, with most of it being positive, the negative has less of an impact. For the younger generation this isn't the best of news, as they tend to fewer open accounts and months of credit history.

So what do you do if you do discover negative information on your credit report that you are certain is in error? By law you are allowed by the Fair Credit Reporting Act to dispute any listings in question on your credit report. To learn what you are going to need for information and documentation either go online or use the automated telephone system. Both are tedious and time consuming, but persist you'll learn exactly what you'll need to submit a written request. Once the bureau receives your request they have to take action.

By law the credit reporting bureaus have only 30-days to verify and respond to your written request. If they fail to meet this time requirement they must remove the listing in question, and notify you of the outcome.

A word of advice - your written request should not be couched in threatening terms. I suggest instead taking the same approach you would for writing an acquaintance. Don't you enjoy receiving a letter from someone who cares whether you are having a good day or not? These types of letters, if written properly, are highly effective. Place yourself in the credit reporting bureau employee's shoes. He, or she, has just opened several letters that all started out the same. Some are irate, some are con jobs and some are downright stupid because the poor soul who wrote it has no writing skills. Now here comes your letter across her desk with a "Thank You" - isn't that a nice, and clever way, to change their mental state and get them interested in what you have to say? Here you are thanking them for something they have not even done yet. Think they might read on further?

Your credit report is truly one of the most important documents you are responsible for. Banks, lenders, and the reporting bureaus are not going to take it on themselves to verify the accuracy and validity of the information unless you take an active role and force the issue. Do nothing and your inaction could unnecessarily cost you thousands of your hard-earned dollars. Take action and enjoy the benefits and advantages of good credit.

Do You Owe More On Your Home Than It's Worth?

Admin — Mon, 02 Mar 2009 09:16:00 -0500

Try to picture being hung upside-down over a yawning chasm. Imagine further still hanging there watching helplessly as the cash in your pockets slowly falls out piece by piece never to be regained as it disappears into the gloom below. Now picture the home you recently purchased during the real estate boom, or refinanced during the same period, not being worth what you initially paid for it. This is known as being upside down in a mortgage and until the current trend reverses you can almost count on losing a little money day by day.

What factors involved brought this problem into being? Probably the biggest reason is the equity mining that went on during the boom times and continues to this day in spite of all the negative media warning against it.

In some parts of the country homes doubled and even tripled in value, so people found themselves sitting on what was for them a considerable cash resource just waiting to be tapped. Another factor contributing to the problem is the real estate bubble is continuing to deflate and home prices are dropping.

If you chose to wring every last penny of equity out of your home during that time frame then the unfortunate consequence may be your home is no longer holding the same value thus creating a vast gap between what you owe versus the homes actual worth. In some instances the disparity may be tens of thousands of dollars. Making this problem worse still is those refinancing are experiencing "resets" on their adjustable rate loans causing their monthly payments to increase by hundreds of dollars in most cases.

Aside from basic greed and lack of foresight on the part of the homeowner there is another player in this drama. Along came a villain in the guise of a lender who was determined to convince you to "make hay while the sun is shining" and use that equity to your advantage.

Initially homeowners took the cash out of the equity for noble enough reasons. They used the money to pay for home remodeling and renovations, college tuition, or maybe to start new businesses, all of which are reasonable motives. Most homeowners in fact left some of the equity in the home.

The lenders were relentless however and convinced consumers to cash out the remaining equity to buy new cars, boats, take expensive vacations, or any number of wasteful purchases.
As housing prices continue to plateau or decline, homeowners who have little or no equity could find they owe more on their homes then they are worth. And, if interest rates rise, homeowners with adjustable rate mortgages may not be able to keep up higher payments or sell the house for what they paid. Foreclosures could spike and the inventory of homes for sale will increase. It's a vicious cycle that could send real estate market into a downward spiral.

The Nationwide Foreclosure Crisis

Admin — Mon, 02 Mar 2009 09:13:00 -0500

The numbers are impressive and also oppressive at the same time. Over 600,000 foreclosures were reported between January and July of this year and there are no signs of the trend slowing up.

Since the beginning of the crisis lenders have made it clear they do not wish to own any property, yet as the qualifications for loans and credit rules have become far more stringent homeowners are now faced fewer and fewer options for dealing with them. Lenders are overwhelmed and many are offering little, if anything at all, in the way of answers to the problem.

Homeowners looking to stop foreclosure are finding some lenders no longer offering loan modifications or refinancing options. Lenders instead are asking homeowners to call as soon as they realize they have, or may have, a problem making their mortgage payment so that other options such as temporary payment suspension, putting missed payments at the end of the loan term, or extending the loan period to lower payments.

Research reports that only about half of the homeowners facing foreclosure make the call. Of those that do contact their lender at the first sign of trouble they are reporting that many lenders are unsympathetic and non-responsive. Many are reporting being placed on hold for over an hour, being shunted around from department to department in a perpetual shuffle trying to speak with the right person, getting dropped during transfers or finding full voice mail boxes.

Adding another twist to this story is the concern over those mortgages bought by foreign investors. These fall under globalization rules which make it difficult to alter a loans term. Many of the mortgages sold in the secondary market are reporting some of the highest default rates.

What has to happen before a turnaround in the current foreclosure crisis can begin a turnaround? Lenders that were slow on the uptake in dealing effectively with distressed borrowers need to implement better lines of communication. Homeowners facing a possible home loan default and looking to avoid foreclosure are going to have to be more proactive in contacting their lenders.

In the meantime thousands of homes are going into foreclosure across the country with several months left this year to set yet another record.