Tips to Buy, Stay In or Sell Your Home

June is National Home Ownership Month. Many Americans purchases homes during June. In June 2010, home sales increased 24% from the previous month. Owning a home is one of the best ways to generate wealth. Owning a home requires financial discipline and sacrifice. Create a budget or spending plan to help manage your finances to make sure you can stay in your home for as long as you like and to help reduce the chances of filing for bankruptcy or foreclosure.

Your monthly mortgage payment should be no more than 38% of your total monthly income. This will ensure that you have extra cash to pay for unexpected expenses and will reduce the chances of using a credit card and going into debt. The advantages of owning a home are: it increases your credit score, proves that you are a responsible spender, provides a tax write-off, increases your financial worth, and provides you with an asset that will appreciate over time.

Before you buy a home you need to prepare for the home buying process. Estimate your monthly mortgage payment. Subtract the difference of the estimated monthly mortgage payment and your current rent (if you pay rent). Here are 6 tips to help you buy a home.
1. Find the best loan
2. Use home buying programs
3. Find a home and make an offer
4. Get a home inspection
5. Shop for homeowners insurance
6. Prepare for settlement and closing

Here are 10 programs to help homeowners stay in their homes.
1. Hope Now Program – www.hopenow.com, 888-995-4673
2. FHA Secure Loan Program – http://portal.hud.gov.
3. Home Affordable Refinance Mortgage Program (HARP) - http://www.makinghomeaffordable.gov/refinance_yes.html
4. Home Affordable Modification Program (HAMP) - https://www.hmpadmin.com/portal/programs/fha_hamp.jsp
5. Second Lien Modification Program (2MP) –https://www.hmpadmin.com/portal/programs/second_lien.jsp
6. HAFA (Home Affordable Foreclosure Alternatives) Program - https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.jsp
7. FHA HAMP (FHA Home Affordable Modification Program) –https://www.hmpadmin.com/portal/programs/fha2lp.jsp
8. FHA Second Loan (FHA2LP) – https://www.hmpadmin.com/portal/programs/fha2lp.jsp
9. UP (Unpaid Principal) –https://www.hmpadmin.com/portal/programs/foreclosure_alternatives.jsp
10. Retired Veteran Program, www.va.gov

Here are 8 tips on how to stay in your home or sell your home.
1. Short Sale. If you cannot afford to keep your home and you are upside down on your mortgage, then a short sale might work for you. Your lender must approve the sale because you would have to sell your home for less than what you owe your lender. As part of your negotiations, you need to make sure that the lender agrees to accept the sold proceeds as satisfying your loan debt.
2. Reinstatement. Your loan is reinstated to current status after you pay the default amount and any other costs or fees.
3. Loan modification. Your lender modifies your current loan to make your payments more affordable by lowering the interest rate and/or extending the mortgage term and adding the default amount to the back end of your loan or forgiving it. Provide documentation to show you are experiencing a hardship.
4. Forbearance. Your lender works out a short term payment plan for you to get caught up on your payments. After you are caught up, you go back to paying your regular mortgage payments. Occasionally, the lender will reduce the principal amount on your loan as well.
5. Deed in lieu of Foreclosure. Signing the deed back to the lender, handing them the keys, and walking away owing the lender nothing.
6. Repayment. Pay the past due amount over a period of months. Read the terms carefully to be sure you can afford the payment.
7. Refinancing. If you have equity, you can refinance by obtaining a new loan with a lower interest rate, at a fixed term with a lower monthly payment and pay off your existing mortgage.

Fraud is an aspect of every industry including the mortgage industry. Beware of mortgage scams and illegal practices. Here are 8 tips to prevent being a victim of predatory lending and discrimination:
1. Do you research before applying for a mortgage loan
2. Shop around to several lenders before making a selection
3. Ask questions if you don't understand something
4. Take the paperwork home and read it over, contact a real estate lawyer or law school student to help explain any legal terms and information you don't understand
5. Make sure all of your questions regarding the loan are answered
6. Make sure you are comfortable with the terms provided
7. If the terms keep changing find another lender to do business with
8. Go with your gut instinct, if it seems too good to be true it probably is

NFL Players are Just Like Us When It Comes to Money

Many NFL players go from a low to middle class lifestyle to upper or wealthy lifestyle in an instant and are not taught how to manage their finances and are not sure who they should or should not trust. Many NFL players are taken advantage of because of their financial status. In other instances they succumb to guilt from family and friends to take care of them, peer pressure, impulse shopping, unable to say no to those asking for money, living above their means, trying to impress others, being overcharged, or bad investments which causes them to lose their homes, have their cars repossessed or file for bankruptcy due to their bad spending habits and poor financial choices.

Many players buy things that have no value and have very little assets. Some forget to pay taxes, don’t keep track of their finances, make bad investments, get caught up in scams and lack basic business knowledge. This lack of financial experience and financial literacy education causes NFL players to buy things they can’t afford and try to portray a certain image that is difficult to live up to.

Approximately 40% of NFL players end up bankrupt after retirement. According to MSNBC approximately 380 players of the total 1,700 players live paycheck to paycheck. The average rookie salary is $320,000. When players get paid, after they pay taxes, pay their agent, publicists, accountants, lawyers and others on their payroll, pay for their lavish lifestyle with a home, multiple cars, jewelry, clothing, helping family and friends they have very little left.

Some NFL players are borrowing money from friends due to the lockout. Some players are getting payday loans called “lockout loans” provided by lending agents. Lockout loans for more than $60,000 can have interest rates as high as 36%. The NFL Players Association in advance of the lockout advised players to save at least 3 game checks and find additional ways to make money but many did not follow this advice. The NFL Players Association also provides financial seminars and classes for players who do not heed the advice provided or may not understand the advice provided.

Many players get caught up in the media frenzy and hype and want to give the appearance that they are wealthy when some are just one paycheck away from bankruptcy. Some players retire and don’t realize they are in financial ruin and need help until they retire.

Many players feel guilty by pressure from family and friends to take care of them financially which can cause a heavy financial strain on players. Family and friends see players on television and don’t realize how many expenses players have each month due to their lifestyle.

Many rookie players try to keep up with the spending habits of some of the veteran players and end up filing bankruptcy or foreclosure on their homes. In many instances players are taken advantage of by lawyers, accountants, agents and others who steal or do not keep their clients informed about their spending habits. In other cases, clients are advised about their poor spending habits but continue to spend until all their money is gone. The NFL Players association, lawyers, accountants, publicists and all who are on the payroll of the players as well as the players themselves are to blame.

My advice to all NFL players, read all books written by Warren Buffet who has lived in the same house for 50 years, drives himself everywhere, does not have security or a bodyguard, never travels by private jet, does not socialize with high society, makes popcorn and watches television, does not carry a cell phone, does not have a computer on his desk, buys clothes from the department store and is an expert in managing his money. You are experts when playing on the field, now it is time to be experts in managing your money – you owe it to yourself.

Help for Bank of America Customers

As of August 2010 over 2 million homes are listed as foreclosed which shows there is still a great need for mortgage companies to work with homeowners to help them stay in their homes. Bank of America has decided to delay foreclosing on homes in 23 states while the company determines if they rushed too soon to foreclosure on some homes.

The states affected are: Connecticut, Delaware, Florida, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Nebraska, New Jersey, New Mexico, New York, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Vermont and Wisconsin.

In some cases employees signed foreclosure documents without verifying the information. GMAC and JPMorgan Chase have also made the same mistake. This issue may lead to lawsuits due to homeowners contesting foreclosures that may not be valid. Pressure is being added to mortgage industry professionals by state attorney generals who are working hard to enforce foreclosure laws.

In some states, mortgage lenders can foreclose quickly on delinquent homeowners. Freddie Mac and Fannie Mae and Freddie Mac stated that they are informing mortgage companies to follow proper procedures.

It is uncertain how this decision will affect homeowners. If you are a Bank of America mortgage customer call the company at the 800 number provided on your mortgage statement to get information about your foreclosure or pending foreclosure.

In the future, go with your gut if you feel you have not been treated fairly by your mortgage company or you feel that proper procedures have not been followed. You can also contact HUD or a certified housing counselor to get a second opinion on any housing paperwork or issues that you are concerned about or have questions about. You can also file a complaint against your mortgage company with the Federal Trade Commission, Better Business Bureau or your state attorney general's office. If you have a FHA mortgage loan you can file a complaint with HUD.