I was reading the paper this morning and saw an article related to the mortgage mess that's getting us all in a frenzy.
Possible solution? Freezing the lower rates for a little while. How long? Well the government is pushing for 5-7 years while investors aren't to happy about that and suggest 1-2 years.
My take on it. I'm with the investors. I think giving homeowners another 2 years to get themselves in a position to refinance at a better, more stable rate to avoid trouble is enough time. Considerable improvements can be made to a person's credit and financial situation in 24 months. I've seen it happen numerous times and have done it myself.
Ok so, there are homeowners who were not educated enough to be prepared for the disaster that is about to strike their pockets and possibly send them into a downward spiral that will be hard for them to get out of. Surely homeowners who want to keep their homes but were not educated about what their mortgage terms really meant or how to prepare themselves for higher rates or to avoid them have already begun to research, educate themselves, and formulate a plan to keep them from the mess they may be facing. Why not give them a little more time to get it together. They are now warned and fully aware that something needs to be done with their situation to save them. An extra 24 months is a good second chance in my opinion.
If this rate freeze is granted, I suggest the following for homeowners who may be affected:
1. Take a close look at your credit reports and begin to repair your credit.Enlist the help of a mortgage professional to teach you how to read your credit reports. Also use online resources to learn to repair your credit. www.creditboards.com/forumsis an excellent resource with tons of information on how to repair your credit. Credit repair is a long and tedious process but it is worth the elbow grease in the long run. I've been there and the information on these boards have helped me alot.
2. Get a budget and stick to it. Saving is crucial. You want to have some money in the bank just in case something happens and you are not blessed with the ability to refinance. A cushion will help you through the hump until you are. Don't buy anything you don't need. If you're an impulse spender, stop it. It's a madness that can be cured. Just be the Little Engine Who Could..."I think I can....I think I can."
3. Get mortgage smart. Follow the mortgage industry. Take advantage of the net and learn as much as you can. By all means, stay here on Active Rain. Use that search option until your little heart is filled with mortgage cheer.
4. This may be related to item #2 but don't make any huge purchases. You're in the running how. You're swimming for your dear life. Don't take on any huge obligations unless you know without a doubt that you absolutely have to. You've been given another chance here so you must do what you need to do to benefit from it.
5. SAY IT WITH ME...DISCIPLINE & ELBOW GREASE WILL MAKE MY LIFE COMPLETE! DISCIPLINE & ELBOW GREASE WILL MAKE MY LIFE COMPLETE!!! Chant this everyday to keep yourselves strong and if that second change gets granted, you'll come out on top!
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