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Should I Stop Making My House Payment If I Want A New Mortgage?

When homeowners are not able to make their house payments without difficulty, it is time to start looking for options to get rid of debt or reduce current expenses. There are several ways to do this, and one of the most well-known options is to file for bankruptcy. Bankruptcy is a great tool for getting out of hand finances under control, but it is not the only option. Another idea to think about is debt consolidation, which is a good way to wrap all of your monthly bill payments into one lump sum each month. In some consolidation cases you might even be able to pay less than the full balance due, which can significantly reduce your overall debt load. Refinance and modification of mortgages are also good ways to curb expenses, and it is important to know the difference between the two.

If you want a new mortgage you can get one by refinancing your current mortgage, just with a new lender. Or, you can ask for your existing mortgage holder to change the terms of your loan by modifying the note. A refinance requires you to apply for a new loan with a new bank, and essentially go through the entire loan process again. But this time around the lender will not loan the full balance, so you will need to have some equity in your home for a refinance to work. With a modification, you will not have to worry about equity or having your home appraised because the loan is changed by the current mortgage lender. But do you have to be current on payments for a modification or refinance? Here are some basics:

● For a refinance to work you should be relatively current on your payments. If you are not it can be harder to get a bank to work with you, because the risk of nonpayment will appear too great.
● In a modification most lenders will begin negotiations once you fall behind on your house payment, and contact them for solutions. This is not to say default is a requirement all of the time, but is common in most cases.

Deciding on what to do to get a new mortgage requires careful consideration of several factors. Only you know what facts apply to your situation, and we can help sort through the data and come up with options for your consideration. The approach we take involves providing you with a thorough explanation of all available remedies, so you are satisfied with your final choice.

If you are considering modifying your mortgage, or want information on other options, contact us at

Will Modifying My Mortgage Make My Payments Lower?

Mortgage modification programs are great ways to reduce your house payment. The way it works is that you apply with your current mortgage lender for a rewrite of your existing mortgage. The rewritten mortgage will have new terms, and the biggest change is a drop in interest rate. Once the interest rate on your loan goes down, your payment will decrease as well.

If you are struggling to make your house payment, you should consider applying for a mortgage modification. The steps required include:

● Filling out an application for modification with your current mortgage holder.
● Providing documents to your lender showing your income.
● Giving details about your current financial situation, and showing that you are currently experiencing a financial hardship such that a lower payment will relieve some financial pressure.
● Participate in a trial modification, if requested to do so, to prove to your lender that you are capable of making the new payment.
It is important to document your efforts, by keeping copies of all documents you send to the lender and keeping a diary of the dates and times of any telephone conversations. It is not out of the ordinary to have your lender request data you have already sent, and if that happens you will want to be able to show the lender the requested information has already been provided. This can take a lot of time and cause a great deal of frustration, and not all lenders will agree to give you a modified mortgage. For these reasons you need to partner with a qualified legal professional who can take on these tasks for you. A good lawyer will also negotiate on your behalf, so the modified terms offered are ones that are within your budget. We can help you analyze your finances and determine if a mortgage modification is right for you or if you need to explore other options. If so, we will let you know what options may work for your situation and help you decide what steps to take next in your efforts to becoming debt free. Our goal is to help you get back on your feet, and give you a positive financial outlook.

For more information about mortgage modifications, contact us at

What Does It Mean To Use My House As Collateral For A Loan?

Most loans are made possible by having some type of collateral to use as security. For instance, when you buy a new car the lender takes a security interest in the car and holds on to that interest until the loan is paid in full. This interest is what allows an auto lender to repossess a vehicle when payments are not made. The same is true when you purchase a house, and use the house as collateral for the mortgage loan. Very few of us can afford to buy our homes outright, so a mortgage on the property is given, to provide assurances to the lender that the loan will be repaid. If not, the lender will initiate foreclosure proceedings to recoup their losses by taking back and reselling the property.

But taking out a mortgage to buy a home is not the only way a house is used for collateral for a loan. Here are some other examples:

• Refinancing your home will require you to use the house as collateral for the refinanced note. If your home is paid off, you will now have a new mortgage on the house and if you are only using the equity in your home you might now have two mortgages.
• A second mortgage is the most common type of loan where your home is used as collateral, and that is the instance of taking a loan against the equity you have built up in your house. A lender will only agree to this type of lending arrangement if the value of the home is significantly more than the unpaid existing mortgage, and will place a second mortgage on the house to ensure repayment.

These types of loans can become problematic if you fall behind on payments. Because if you have two mortgages you also have two payments, and two lenders looking to enforce their security interest in their home. It is not uncommon for a second mortgage holder to attempt foreclosure for non payment, even if you are making the payments on the first mortgage. This is likely to happen if you have equity, because any foreclosure by a second mortgage holder is done subject to the first mortgage. This area of law and a potential foreclosure in this situation is complex, but we can help. Whether the answer is to file bankruptcy, ask for a modification of your mortgage, consolidate debt, or some other solution we can help.

For more information about how to get out of debt, contact us at We will help by coming up with solutions that work for you.

Should I Take A Payday Loan To Get Out Of Debt?

When you have more bills than you can pay, you start to look for any way to get out of debt and keep current on monthly obligations. Some people turn to friends or family, take out a consolidation loan, or try to refinance their home. But you have to be careful when looking for ways to transfer debt, so you don’t end up owing more and so that you actually make progress on getting your debts paid. A question that often arises is whether a consumer with overwhelming debt should take out a payday loan to get out of debt.

Taking a payday loan to get out of debt is not a good idea. Typical payday loans have characteristics that make getting out of debt impossible, such as:

• High interest rates, which are considered by some to be more than what the law allows
• Prepayment penalties, on the off chance you are able to pay off the loan before it is due you might end up paying more because a prepayment penalty could be added to the balance
• Payment due dates that come up quickly, there is usually a fast turn around time on repayment of a pay day loan and depending on your financial picture you may be unprepared to make the payment when it is due. If so, you will face more interest and penalties.
• Fees and costs that add to what you owe, which can make the payment beyond what is within your budget and cause you to rack up more fees and costs on top of the accumulating principal and interest amounts.

One alternative to a payday loan not mentioned above is to file for bankruptcy. Bankruptcy will not require you to pay exorbitant rates on the debts you do repay, and in fact you might even be entitled to lower interest rates rather than increases. Depending on the type of bankruptcy you file, you can reduce the rate on your auto loan and you can also reduce the total amount of unsecured debt you owe. Those are common components of a Chapter 13 case, and in a Chapter 7 you will be entitled to have your unsecured debt completely forgiven. Rather than spin your wheels and go nowhere fast by taking out pay day loans, consider bankruptcy to help get you out of debt. We have filed cases for people with all sorts of financial situations, and will work with you to file a case that meets your needs.

For more information about bankruptcy, contact us at

Will I Be Able To Get A Credit Card If I File Bankruptcy?

Having too much in credit card debt is the reason most people file bankruptcy, but the need for credit in an emergency still remains. So even if you need to file bankruptcy to get out of debt, you may still need access to credit from time to time in order to cover unexpected expenses like home repairs or medical bills. This paradox is puzzling to those that want to file bankruptcy to help improve their financial situation, so a quick run down on what to expect is in order.

Getting a credit card after you file bankruptcy is not only possible, but highly likely. Here are the most important things to know about bankruptcy and credit card debts:

• You can get rid of all of your credit card debt, or at least have the balances lowered to a fraction of what you owe, by filing for bankruptcy.
• When you no longer owe credit cards each month, you can use the money you were spending on minimum payments for other obligations. Elimination or reduction of credit card balances typically frees up a large chunk of disposable income for many consumers.
• Once your case is discharged, the credit card debts are no longer considered due and your card issuers cannot ask for repayment.
• Shortly after your bankruptcy case is discharged you may begin receiving offers from credit card companies, to take out a card and start rebuilding your credit. The interest rates on these cards will be higher than what you are used to, so be careful about accepting an offer and relying on a credit card after bankruptcy. After all, if credit card debt overwhelmed you prior to filing, you do not want to go down that road again in the near future.

Our best words of wisdom on getting a credit card and using it regularly after you have filed bankruptcy is to only do so if you are able to pay it off in full each month. Otherwise you will reenter the cycle of paying interest on top of interest, and racking up a balance that might become too much to bear. All of the hard work you do to get out of debt by filing bankruptcy should not be put at risk by jumping right back into a load of debt. Be careful about the new debt you acquire after filing bankruptcy, and work instead towards establishing an emergency fund so you do not have to resort to credit for large purchases or emergency situations.

For more information about bankruptcy, contact us at We will help by coming up with solutions that work for you.

The Top Two Ways To Change Your House Payment

Many Americans bought into the “American Dream” of home ownership only to be staring down large house payments years after signing on the dotted line. And for many, the monthly house payment is the single largest expense to pay every 30 days, leaving very little money left over for other necessities and bills. If your house payment is too high, there are things you can do to get some relief. Knowing where to look is the first step, and then deciding what will work for your family comes next.

The top two ways to change your house payment, and get on a more affordable repayment plan are to:

• Ask your lender to rewrite the note. This is done by modifying the mortgage, and the rewrite typically includes lowering the interest rate. Once the interest rate is lower, the payment will go down and become more manageable.
• Refinance your note with a new lender. If your current lender is not willing to help by modifying your mortgage, a different lender may be willing to refinance the note on your behalf.

This will require an approval for a new loan, which means you need to provide income verification and possibly have an appraisal of your home done. Most refinanced loans are only made if there is sufficient equity in the home to cover the refinance, as many lenders only offer refinance options for around 80% of the home’s value. So if your home has a lot of equity in it, meaning it is worth significantly more than you owe, you may be able to use that equity to your advantage by refinancing your existing mortgage.
When neither of these work, you can also consider filing for bankruptcy. While you still have to make your house payment if you want to keep your house, even if you file bankruptcy, what bankruptcy does is eliminate or reduce your other bills so your house payment is no longer out of reach. When you have fewer things on your plate to pay each month, a once unaffordable house payment suddenly becomes within your budget. Whatever your need or circumstances, we can help.

For more information about how to manage debt, contact us at We will help by coming up with solutions that work for you.

What You Can Do To Get Charged Off Accounts Off Your Credit Report

Your credit report sums up your creditworthiness, and is relied upon by lenders when you apply for new loans. If your credit report shows you pay late, have been foreclosed on, or had a car repossessed you are less likely to get a loan with a lower rate. But bad marks on your credit, even a bankruptcy, do not mean that you can never buy a house or get a loan. And while there are some things you are not able to control, when it comes to your credit you should question what is reported and make challenges when necessary. If you are successful, your credit score can go up, which helps you get better loan offers.

One of the most damaging items on your credit is a charged off account. A charged off account is one where you have not made payments for at least six months, so the creditor writes the balance off their books and asks that you pay the entire balance at once. Most people are not able to pay a large balance all at one time, and so the lender ends up going to Court to get a judgment for the balance. All of these things hurt your credit, and so you should do these things to have a charged off account removed from your report:

• Respond to any lawsuit filed against you, so you can assert any defenses you have to the nonpayment of the debt.
• Dispute that the debt is valid, and ask the lender to provide you with a pay history and current balance due.
• Challenge the balance, which will require you to show all payments made and show that the creditor’s records are not accurate.

It is important to remember that an account that is reported as charged off is not the same as an account being reported as paid off. You can also try to work with the lender directly, and ask that they remove the notation of charge off from your credit. If you decide to make this request, it is crucial to do it in writing and keep copies of all correspondence you receive from the lender. If the lender make an agreement with you but that agreement is not reflected on your credit report, you can send copies of all documentation to the credit reporting agencies and ask for an investigation. We can help with this process, and invite you to contact us today to learn your options and how we can help you achieve financial success.

For more information about how to get out of debt or what to do to make sure your credit report is accurate, contact us at We will help by coming up with solutions that work for you.

Five Ways To Manage Debt

Managing debt is no fun, but is a necessary part of life if you want to have financial success. The key to successful debt management is to come up with a plan that works for you, and stick to that plan. Once you have identified your financial needs, you are better prepared to come up with a debt management plan that makes sense. Regardless of whether you have a little debt, or are struggling to make ends meet, there is a plan that will help you.

The first step is to make a list of your expenses, and add up your total household income. Once you do that, here are five ways to manage the debt you have:

• Budget to spend only what you make, and no more. If you are spending more than you make, a budget will show you where you can cut out an expense, or at least cut back on the amount of that expense each month.
• Consolidate high rate debts into one loan with a lower interest rate, so you only have one payment each month at a lower rate. This will not only make it easier to pay the debt because you will only have to make one payment, but you will also pay off your debt faster because the interest rate will not be as high.
• Ask your mortgage lender to modify your mortgage. A mortgage modification lowers the interest rate on your house payment, which means a lower house payment. If you are able to pay less for your house each month, you can use the extra money to pay off other debts.
• Focus on one debt at a time, pay that debt off, and then use that monthly payment to work on the next debt.
• Call your credit card companies and ask for a lower rate, or for a lump sum payment of less than what is owed to settle the account in full.

You can also manage debt by seeking the relief offered by the bankruptcy laws. The biggest benefit of filing bankruptcy is that the instant you file a case your lenders are prohibited from contacting you, from maintaining pending collection actions, or from starting a new collection lawsuit against you. This means if you are in foreclosure or your wages are being garnished, these will stop the minute a bankruptcy case is filed.

For more information about bankruptcy, contact us at

Three Reasons Why You May Not Be Able To Save Any Money

We all know having a savings account can help you stay out of debt when an emergency or unexpected expense arises. But knowing that having a savings account is important does not always equate to being able to fund a savings account. For most people, money is tight, and people are having a hard time just paying the bills these days, let alone having any extra money left to set aside at the end of the day. But that does not have to be the case, and with a quick look at what is keeping you from saving, you can learn where a change in habits is needed so you can be more financially prepared for what life throws at you.

Three reasons why you may not be able to save any money are:

• You don’t have a budget, so you don’t know where your money is going each pay day. When you don’t know what expenses you have, you are not able to pinpoint areas of overspending and thus miss opportunities to cut back and save.
• Your check book isn’t balanced. A balanced check book is something that is hard to achieve, especially if you use your debit card or a phone app to make most of your purchases. Unless you write down these expenditures or keep every receipt you get, you may be overlooking a purchase. If you don’t have record of what you’ve spent, you will not be able to balance your check book and so won’t ever have a good picture of how much money is available to you for saving.
• You spend more than you make. If you routinely spend more money than you make, you will never have anything left to put into a savings account.

We know how hard it is to save money, especially when you have had a financial set back. It could be that you have been laid off, had a medical emergency, or been forced to work fewer hours at a lower rate of pay, and these circumstances make it hard to pay the bills let alone start a savings. If you have too much debt, think about how filing bankruptcy might help you. Bankruptcy can help you get out of debt, cab help you learn what types of spending behaviors lead to debt, and can give you instant relief from creditor harassment so you can stop and breathe.

For more information about bankruptcy, contact us at We will help by coming up with solutions that work for you.

What Happens In A Repossession Action?

A repossession case is a legal way for a lender to take your property away from you, when you don’t make the required payments. It is a type of action reserved for the taking of personal property, which is not the same as real estate. Commonly repossessed items of personal property includes cars, motorcycles, and boats. In some states a repossession agent can take a person’s car or other items of personal property without a lawsuit being filed, as long as there is not a breach of the peace during the taking. However, it is more likely that the lender will file a lawsuit to take your property, and this type of action is called a replevin.

In a replevin action the lender has to do the following:

• Identify the item sought to be repossessed, with enough description so that the item is easy to spot when the writ of possession is entered. It is critical that the Court has enough information to identify the property, so a wrongful repossession can be avoided.
• Sue for at least the value of the item.
• Seek an order from the Court allowing the property to be seized.
• Set forth information that shows why and how the lender is entitled to take possession of the property. This usually consists of allegations that the loan is in default and that the lender has an interest in the property, as a secured creditor for having made the loan used to purchase the item.

If you receive a replevin suit, you will need to file an answer or you risk losing your property. There may be circumstances that prevent the lender from taking your property, but if you fail to file an answer and set forth those reasons the Court will allow the repossession to take place. One option you have, aside from filing an answer and raising a valid defense to the request to replevin, is to file for bankruptcy. A bankruptcy action will stop a pending replevin request, and will also help you to get the rest of your finances in order. Bankruptcy filings also put an end to foreclosures and wage garnishments. For help deciding what is best for you, call us today.

For more information about repossessions, contact us at