Strategic default is a term coined to describe borrowers who are willfully (or passively?) allowing their mortgages to enter default because their homes are underwater. Why do people strategically default on their mortgages? People strategically default for many reasons, but mostly because they no longer want to throw money out the window. A few borrowers  … Read more

You maybe haven’t heard of a cash-out refinance lately. Here’s why:  cash-out refinancing assumes that you are in an upside down mortgage. In fact, it only works if you have solid equity in your home and your home hasn’t lost much, if any value. The beauty of the cash out refinance A cash-out refinance allows  … Read more

It has become common for a newly divorced homeowner to default on a mortgage and end up in foreclosure. With the primary breadwinner no longer supporting the household, the person who took the house in the divorce may suddenly find it impossible to stay current on the mortgage. When he or she falls into default,  … Read more

Debt negotiation letters are to be written during the final stages of a debt negotiation. They are superior to haggling over the phone because they provide a document of any communication or proposed transaction between you and bill collectors. Writing a negotiation letter should be done with the assistance of a non-profit debt relief service.  … Read more

Private mortgage insurance is insurance a lender takes out on less than prime or higher risk loans. This insurance protects the lender in the case of default on the part of the borrower, like foreclosure or a short sale. As a borrower, you can make less of a down payment, which is usually 20% of  … Read more

Under the Forgiveness Debt Relief Act of 2007, you have no tax obligations after a short sale until 2012. However, the status of tax liability in this case may change very soon. A common misconception troubled homeowners frequently held before 2007 is that they were free of their tax obligations to the IRS after a  … Read more

There are many debt settlement options available and when considering the differences between Chapter 7 and Chapter 13, it is important to review the size and scope of your debts. To determine if one qualifies for Chapter 7 bankruptcy, a borrower must undergo a means test and complete a pre-filing credit counseling session. For Chapter  … Read more

If you have bad credit, but would like to take advantage of super low refinancing options right now, there are a few simple things you can do. If your house is at risk of foreclosure, or sold your home in a short sale recently, you will still have to wait at least 2 years before  … Read more

Many lenders are participating in the Home Affordable Modification Program. This government-sponsored loan modification program offers incentives for lenders to help troubled homeowners with their mortgages through a loan modification. Successful modifications rewarded Currently, many lenders are extending temporary loan modification terms to borrowers. If the borrower proves they can make their payments during trial  … Read more

Foreclosures and bankruptcy will be on your credit report for years. That doesn’t mean that you have to suffer for it indefinitely. The quickest way to rebuild credit is to take on new debt. Unfortunately, there aren’t many lenders who are willing to do this right after a bankruptcy. But you can reasonably expect that  … Read more