Posts Tagged ‘Foreclosure’
Breaking news:
The Obama administration has announced changes to its flagship foreclosure prevention initiative – the Home Affordable Modification Program (HAMP). Among the changes, borrowers who are struggling because of debt beyond their mortgage will be eligible for a secondary evaluation with more flexible debt-to-income criteria, and eligibility will be extended to investor-owned homes that are used as rental properties. The administration is also giving principal reductions a bigger role within the program, tripling incentives for investors that agree to write down an underwater borrower’s principal balance and offering these same incentives to the nation’s two biggest mortgage investors – Fannie Mae and Freddie Mac.
We’ll all have to stay tuned to see how this develops . . .
While foreclosures in Wisconsin are down, the housing crisis still exists in Milwaukee, Kenosha, Waukesha, and other southeastern Wisconsin communities that Miller and Miller serves. Here is a link to an interesting article from MSN Money on why something needs to be done to remedy the housing crisis, along with a unique solution.
If you live in the Milwaukee metro area and are looking for ways to keep your home, contact Miller and Miller today. And remember that we have offices conveniently located in Milwaukee, Kenosha, and Germantown to ensure that everyone in southeastern Wisconsin has an office close by.
Mortgage foreclosure filings in southeastern Wisconsin dropped 14% in 2011 to the fewest in four years, good news for a battered residential real estate market that is still is working through an abundance of foreclosed homes. Mortgage foreclosure filings in Milwaukee, Waukesha, Kenosha, Racine and Ozaukee Counties dropped 14% in 2011 to the fewest in
USA Today recently published an article explaining that Americans’ student loan debt, which totals approximately $850 billion, now exceeds outstanding credit card debt in the U.S., which totals approximately $828 billion.
Perhaps a more interesting element of this story has to do with the monthly repayment numbers borrowers are expected to pay. The USA Today article suggests that $30,000 of student loans, payable at 6.8% interest over ten years would amount to $350 per month. At this level of debt, the average person would need to earn at least $42,000 per year. Unfortunately, as bankruptcy attorneys we commonly see student loan debt in excess of $100,000, with monthly payments over $1,000.
From a bankruptcy perspective, student loan debt is not dischargeable except in cases of “undue hardship.” In the Eastern District of Wisconsin, the court uses a very strict three part test to determine whether student loans may be discharged. As the law stands today, debtors in the Eastern District of Wisconsin have not been successful in arguing for hardship discharge on the grounds that they cannot find a job that pays enough to support their student loan obligations.
Karen Blumenthal recently published an article in the Wall Street Journal entitled, New Ways Bankers are Spying on You, which discusses how in these difficult economic times, banks are doing much more than simply looking at your credit score when deciding whether or not you are worth lending to.
This brings to mind the client who comes to my office and tells me that even though they are hopelessly in debt, they are worried about filing a bankruptcy because their credit score is still high. I always remind these clients that your credit score is supposed to be one of many barometers of your financial health, not an absolute indication of financial health. Unfortunately, many people are encouraged to misuse credit based upon the erroneous assumption that all is well because their credit score is still above 700, and they slowly fall into financial hardship.
The definition of financial health includes living within a budget, controlling debt, using credit responsibly, working towards short and long-term financial goals, and saving. It is challenging to manage any of these things when you are struggling to make minimum payments on your monthly obligations.
The federal bankruptcy laws provide a solution for those who are overwhelmed with debt. Bankruptcy can restructure or eliminate certain debts while protecting assets like your car, your home, and your 401(k). If you have more debt than you can handle, and feel like you aren’t getting ahead, don’t be fooled by a high credit score. It might be time to consult with one of the experienced attorneys at Miller and Miller, who can advise you of your options on how to get back on the road to financial health.