Those struggling under a mountain of debt may not be aware of the various options available to get out of that debt. Between declaring bankruptcy, going for credit counseling, or starting the debt settlement process, we think the most sound evidence for success points toward debt settlement.

We are also convinced that it is much easier on you, as well as guarantees you the most reduced amount of debt, to have a team of professionals experienced in loan modification to go through the process on your behalf. When trying to choose the right team to work for you, here are some guidelines for making sure you're getting the best:

1. Do your homework or seek professional independent advice from others who have done their homework and compare contract terms.
2. Choose a company that does not charge a set up fee.
3. Choose a company with a low monthly maintenance fee (never agree to monthly maintenance fees totaling more than $50/mo)
4. Choose a company that does not charge an enrollment fee, and then later also charges a percentage of what they negotiate away (double fees).
5. Choose a company that allows you to always have complete access and control of your money paid into the settlement program.
6. Choose a company that allows you to borrow or simply take back and keep any amounts paid into a settlement fund account without penalty.
7. Choose a company that allows you to miss a payment and restart your payment plan without having to repay any fees and without any penalties.
8. Choose a company that has at least several years of experience in the business.
9. Choose a company that has no complaints or lawsuits against it from past or current customers.
10. Don't take a company representative's word for these contract terms - read the contract yourself and find these provisions in writing.

For more information, check us out at www.januaryfinancial.com.

It's not something any of us would ever wish for. In fact, for many of us, it's our biggest fear. But in hard economic times, it's all too common to see people face what they'd prayed they'd never have to face. Maybe you are one of the people facing the day when your finances have become too much to manage, and you're wondering if there's even a way out from underneath your mountain of debt.

Well, there is - but not all deal-with-debt plans were created equal. Here is an outline of the four main routes people take when they've hit the wall and want the help of an expert to deal with their debts:

Option #1 - Bankruptcy

• Negative credit report for ten years
  
• BK-13 usually requires 100% pay back of principle amounts borrowed over a five year period
  
• Attorney fees to file BK typically range between $3,000 and $5,000.
  
• Amounts paid into a BK repayment plan cannot be accessed in the case of an emergency.
  
• Typical payment on $40,000 of an unsecured debt would be in the $800 range for five years.
  
• Provides some protection for other assets if BK judge allows those assets to remain in the consumer's possession.

Option #2 - Debt Management, Consumer Credit Counseling or some other Non-Profit Debt repayment program

• Negative credit report for 7 years
  
• Usually requires 100% pay back of principle amounts and usually some interest
  
• Fees for the program are generally split between the lender and the consumer
  
• Amounts paid into a non profit repayment plan cannot be accessed in the case of an emergency
  
• Typical payment on $40,000 of an unsecured debt would be in the $1000 range over four to five years.
• Creditors may seek any and all forms of collection for missed payments including collection agencies, judgments or garnishments.

Option #3 - Do Nothing

• Negative credit forever, as accounts are resold to collection agencies perpetually.
  
• Interest and penalties continue to accrue causing the balances to continually increase.
  
• The cost of never ever being able to re-enter the credit system could far exceed the money saved by not paying over time.
  
• Creditors may seek any and all forms of collection for missed payments including collection agencies, judgments or garnishments.

Option #4 - Debt Settlement

• Negative credit report for 7 years.
  
• Attorney contract guarantees amounts will be settled for less then 50% of the amounts owed on average.
  
• Payment plans only last 18-48 months by which time the consumer is debt free and protected from any further collection efforts by the creditor.
  
• Until accounts are settled, creditors may seek any and all forms of collection for missed payments.
  
• Typical payment on $40,000 of unsecured debt would be in the $500 - $700 range for 3 - 4 years.
  
• All fees are included and paid from the monthly payments requiring no additional out of pocket expenses from the consumer.
  
• Some Debt Settlement programs allow the consumer to access their account in the case of emergency and borrow or withdraw cash without penalty.

Based on the attorney guarantee, the lower amounts of money coming from the debtor's pockets, and the emergency fallback potentials, we strongly prefer Option 4 over the others. Confirm with someone whose financial wisdom you trust, and then visit us for more information at www.januaryfinancial.com.

Especially when kids are involved, it's easy to focus on the material aspects of Christmas - new toys, new clothes, new gadgets. Of course, it's not really any better if only adults are involved, the toys just get more expensive!

Many of us have a lot less money to spend this holiday season than we have in recent history, and this year is the perfect time to revisit what the holiday season should really be about: family, love, and generosity to your fellow man (or woman!). If you are facing the reality of spending less this year, or you just want to reevaluate your family's holiday traditions, consider the following ideas:

• along with the daily ritual of opening an advent calendar window, challenge your children to do something kind or thoughtful for someone else every day. As they eat their chocolate, they can tell you about it.
• Convince your extended family to participate in a gift exchange rather than purchasing individual gifts for each person.
• To keep yourselves entertained, you could also have an "white elephant" exchange: each person brings a silly gift of $10 or less. Put all the gifts in the middle, and have one person choose a gift and open it. The next person can either choose a gift from the middle, or choose to steal the first person's gift, whereby the first person gets to open a new one. This gift exchange game is sure to bring lots of laughs!
• Volunteer at a homeless shelter or soup kitchen. As you help others less fortunate than yourself, remember all the things you have to be thankful for.
• Bake holiday treats instead of buying gift baskets for work associates.
• Don't be a snob - shop at Walmart or even the dollar store for basic items.

In short, just be creative! There are plenty of ways to make the holidays memorable without spending a lot of money, and we're confident that you can make it happen.

To learn more about us, visit us at www.januaryfinancial.com

September was an exciting time. The kids were back in school. A hint of crisp weather was in the air. A plan was afoot within the government to purchase "toxic" mortgage-backed securities from Freddie Mac and Fannie Mae. Life was good.

The problem was, after Congress approved TARP (the Troubled Asset Relief Plan), the Fed changed its mind and went to bail out banks instead of the mortgage market. It seemed back to square one for anyone involved in the mortgage industry, whether as a professional or a consumer.

But have no fear, faithful readers, good news is afoot yet again! Last week, Henry Paulson approved another plan, very similar to the first, the aim of which is to help detox the poisoned environment of the mortgage market. Mortgage rates went a lot lower, allowing many people to refinance into better loans.

Rates are still good over a week later. Some reports are even surfacing of 30-year fixed mortgages available on purchase loans (not refinances) for 4.5%. These rates may even be available for jumbo loans (which are necessary in many areas of Southern California).

With all this good news, there is an inherent danger afoot: the desire to continue waiting for rates to drop even further. Many borrowers will decide that if rates are decreasing now, they will continue to decrease and it will be advantageous to wait it out. The problem is that the plan that would bring about these lower rates has not yet solidified, and many changes could still occur that could cause rates to change dramatically. Also, there's no guarantee that the change would be in favor of borrowers - rates might actually increase.

As always, our advice is to contact a trusted mortgage professional (like us!) whose job is to read the markets so as to best advise their clients for their individual situations. If you are considering a new home loan or changing an existing loan, please call us first to make sure your next move is the best one available.

Find out more about us on our website: www.januaryfinancial.com

If there's one thing we all know by now, it's that we are in a buyer's market. We are taking this opportunity to showcase amazing buys around Orange County, particularly in the Foothill Ranch area, and giving readers a quick look at what it would take financially to own one of these homes.

This beautiful townhome in the private community of Portola Hills is on sale now! Enjoy the sweeping views of the canyon from the upgraded kitchen with stainless steel appliances. Take time to play and relax in the spacious backyard with both grass and tile. At night, put your feet up and relax in front of the custom fireplace and custom flooring.

• Purchase Price: $320,000
• Loan Amount (assuming 20% down payment): $256,000
• Interest rate on a 30-year fixed mortgage (based on current numbers, subject to change): 5.5%
• Monthly payment: $1816.92

If you are paying rent on a similar-sized home, consider the financial benefit of owning your own home and taking advantage of the tax benefits, as well as the intrinsic benefits of owning a your living space.

Many other homes like this one are available in Orange County and we are committed to finding the right loan for our clients' particular situations. Please contact us today

Please note that all figures quoted are for estimation purposes only and do not constitute a loan offer. Numbers are based on good credit standing. In some cases a smaller down payment amount may be available.

Find out more about us on our website: www.januaryfinancial.com

It's official: we are in a recession.

Pundits and politicians danced around the word for months, not wanting to declare such bad news, but last week's decision by the National Bureau of Economic Research (NBER) made it unavoidable. Not only are we in a recession, but we have been for the last year.

"Big surprise," many of you are saying. It's true: whether it was officially labeled a recession or not, the last year's economy has been tough on most of us. Many have adjusted their lives to make their dollars work, from small changes like eating out less often, to big ones like undergoing a loan modification to save money on home mortgages.

So, while in reality, the official recession news probably won't change your day to day too much, here are some things to keep in mind as we face the beginning of a new year:

• historically, by the time the NBER gets around to officially declaring a recession, we're usually within a few months of the end of it.
• in the years since WWII, the US has experienced 11 recessions (this one included), the average length of which is 10 months. We're officially in month 11, which means that statistically the end is in sight.
• many firms are aware of the recession and are more willing than ever to work with consumers financially, whether through a loan modification on your mortgage or a restoration of credit. Now is the time to start negotiating!
• although the stock market is taking a beating right now, time heals all wounds. Historically, 100% of all the 10-year rolling averages of market returns since these things started being recorded have ended in the black. Try not to panic about your 401(k) and instead, give it time to recover.

The main thing to keep in mind while living through a recession is to stay optimistic. Things could most certainly be worse, and there's never been a recession that we haven't come out of!

Check out this link for further information.

Do you remember a time growing up when your father said to you, "well, kids, it's time to tighten our belts"? Or maybe your mother tried to soften the blow, telling you in October that "it's going to be a very small Christmas this year."

In hard economic times like the ones we're experiencing now, Americans are often required to tighten their financial belts in order to make ends meet. A very positive outcome can be expected from this though, as we learn to better save and manage our money, as well as to evaluate our expenses. Here are some ideas and tips on making sure your money is being used to its best advantage:

1. Property taxes - these taxes are assessed as a percentage of the value of your property. In the last few years, values went up --- way up. And property taxes went up too. We all know that values are going down now, but have you seen a corresponding decrease in your taxes? If not, you can be proactive in getting those taxes reassessed and potentially saving a lot of money. Just ask us how!
2. Insurance - Geico, Allstate, Liberty Mutual and the rest love to tell you about how much they save their customers on their insurance. Do you know that hundreds of other insurance companies exist with equal or better coverage and lower rates? The best way to find them is through a trustworthy insurance broker who can shop many different carriers at one time to find you the best coverage at the best price. You may be able to save hundreds of dollars without losing a penny of coverage. (Put our broker to the test by contacting cyara@stratumins.com and asking for a free, no obligation quote)
3. Loan Modification - for struggling homeowners, modifying your home loan is a very real option to keep you in your home. Depending on your situation, you could save hundreds of dollars a month on your mortgage (to save time and headaches, please contact a loan mod specialist -- like us -- to be your advocate throughout the process).
   

Some other ideas to save money on a smaller scale include:

• getting your hair cut less often
• planning your meals a week in advance so you spend less money eating out and wasted on unnecessary groceries
• canceling magazine subscriptions and read the highlights online instead
• going clothes shopping for what you need only - not when you're looking for entertainment
• exercising more - you'll save money on other forms of entertainment if instead you head outside for a walk

If you're short for cash, you don't need to resort to credit cards to make ends meet. A simple evaluation of your spending, as well as taking advantage of the possible savings above, will help you slide through this slowdown without visiting the soup kitchen.

Every time I listen to the news these days, I think of that old song, "raindrops keep falling on my head..."

The stock market continues to tank. Drip. The dollar is barely getting any stronger. Drip. Home prices are on a slippery slide downward. Drip.

Bad news just keeps pouring down out of the heavens, causing America to shudder with fear every time a news item flashes into our minds. We start planning out "what if" scenarios in order to prepare for the worst. We batten down the hatches and wait, paralyzed with the fear of losing everything.

Did you know that fear of losing is making you miss out on a lot of potential opportunities to improve your lifestyle?

There are the obvious examples:

• buying real estate at a "bargain" (may or may not be a good idea for your particular situation)
• buying stocks at a bargain
• renegotiating your home loan with your lender to take advantage of a potentially lower payment (only works if you're clearly struggling financially)

And then there are the examples that we like better, of the "think outside the box" variety:

• make over your home by benefitting from contractors lowering their prices to get you to accept their bid
• create new business concepts that work better in a struggling economy than a booming one, like a business helping families learn to cook healthy meals at home on a budget
• save money on entertainment by instead vowing to discover your own neighborhood
  

If you are feeling nervous in this bad news rainstorm of an economy, first acknowledge that to be nervous about the future is normal. Then, shake off your fear, straighten your shoulders, and give us a call to see what opportunities may be available to you.

The Team at January Financial

Office: 949-305-6355  ---  email: info@januaryfinancial.com

The good news for real estate investors: buying a home in Orange County is about as cheap as it was in 2003.

The bad news for real estate investors: competition is fierce and rents are dropping.

We all know that with so many families foreclosing on their home loans, buying inexpensive rental properties is becoming relatively easy for investors. One of the [millions of] side effects of this whole crazy economic downturn is that now those savvy investors are having a hard time finding tenants who can afford the rent. 

Rental rates here in Orange County will "only" drop about 3% this year, which is not nearly so bad as Florida. There, rents are expected to drop 10%! (OC Register).

So for any tenants or potential first-time home buyers out there, pay attention and watch for opportunities, either to negotiate lower rent, or find an inexpensive home for which you can afford the mortgage. Investors, make sure you've got a reliable tenant lined up before you head into escrow to sign your closing papers.

Cyara Pott - Market Specialist

The father of a friend of mine has been flying for American Airlines for over 30 years. Though this pilot will only be turning 60 this November, he has decided to take an early retirement. He has some very foresightful reasoning for doing so.

Knowing that his pension is linked to the stock exchange, this man took the chance a year or two ago to lock in his retirement income amount to what the stock market was doing then. I'm not sure of the logistics, but this lock only lasts a couple of years. Rather than retiring in a few years as planned, he has decided to take advantage of his good position now instead of working until the lock expires, and then having to work a few more years just to get his retirement back to the original position.

I've got a couple decades left until I can retire at the standard age, but this gentleman's actions got me thinking. The news reports all this market volatility as bad news only. In reality, there are many opportunities afforded by this investment market that wouldn't have been available a few years ago.

In the meantime, I'm resolving to continue thinking creatively to see how I can make the most of less than ideal times. It just takes a little outside-the-box thinking.

Cyara Pott - Market Specialist