Mortgage by Randy
monthly update to our clients, colleagues, family & friends
By: Randy Mitchelson, June 2009
===============================================================================
In Issue 15 We Touch On:
Free Loan Modifications
Good & Bad of New Credit Card Regulation
Fixing Credit Report Errors
Mortgage interest rates surged in the last 3 weeks (about 60 basis points) so refinances are slowing. Rates are still very low in historical terms so purchase money mortgage volume is steady. The Federal Reserve has engineered this rate environment dating back to their fourth quarter 2008 tactics so there is no worry about rates suddenly ballooning. A no point 30 year fixed mortgage costs 5.80% on average as of June 12. On to the news....
The current newsletter and all prior newsletters are archived at the MortgageByRandy blog. Bookmark it and share with your friends and family. You can make your own comments and feedback as well. Time for the news...
Mortgage Market: Politicians Can Do Some Good! Free Loan Modifications
The loan modification business is a scary place. There are both legitimate and unscrupulous companies operating which advertise their services to help people get their mortgages modified by the lender. Senator Mel Martinez (R) from Florida recently sent a newsletter with this story about a woman his office helped. If all it takes is a phone call to your senator's office, then the loan mod companies better watch out! This proves that people need not pay thousands of dollars to "specialists" to get modifications done.
LOAN MODIFICATION SUCCESS STORY WITHOUT USING A LOAN MOD COMPANY
Ms. Taylor was recently laid off and could no longer afford to make her mortgage payments. She submitted a hardship letter to her mortgage company asking for a reduction in her monthly mortgage payment. When she did not receive a timely response from her lender, Ms. Taylor contacted the Office of Senator Martinez for assistance.
A caseworker contacted the Office of Thrift Supervision, which oversees Ms. Taylor's lender. A representative from the Office of Thrift Supervision asked the lender to check on the status of Ms. Taylor's request. Following the request, the lender offered Ms. Taylor a forbearance plan to allow her time to find employment before her payments were restarted.
Share this story with anyone you know that is struggling with their mortgage payment due to job loss, unexpected medical issues or a death in the family...or any other legitimate reason.
Personal Credit: What If Your Credit Report Is Wrong?
You started monitoring your credit report more closely - great! Now what to do if incorrect information is found on it? The process is simple, but requires a small investment of time and follow-up and some organized record keeping. Credit bureaus must investigate any item that you claim is incorrect.
To initiate the process of correcting inaccurate information, compose a letter (contact me for a template) explaining exactly what is inaccurate and mail the letter (return receipt requested) to each credit bureau that the information is wrong on. If your letter involves information supplied by a creditor, the credit bureau will mail their own letter to the creditor to validate the information and the creditor has 10 days to respond. The credit bureau may grant an extension of this 10 day period upon request by the creditor up to 30 days. If the information is indeed incorrect the credit bureau must correct or delete the information within 30 days. You may request that the credit bureau send corrected reports to creditors who have received reports in the last six months or any employer who had received a credit report during the past two years.
Economy & Financial Insights: Obama Signs Credit Card Regulation - Will It Help or Hurt?
Commerce Department reported last week that the personal savings rate of American households in April rose to 5.7%, continuing an upward trend that Mortgage by Randy first reported in October 2008. People are using those extra dollars in their paycheck to pay down debt and create rainy day funds. In fact, the Wall Street Journal reported April 30 that Visa said total dollar purchases made using its debit cards surpassed credit-card volume for the first time in the last quarter of 2008. The growth of credit card use has finally come to a halt.
In a bid to aid consumers hit hard by the recession, lawmakers submitted a bill subsequently signed into law by President Obama May 22. The legislation stops retroactive rate increases, requires companies to post credit-card agreements online, ends the practice of shifting payment dates, and requires statements to be mailed 21 days before a payment is due. NOTE: this law goes into effect in February 2010 so the banks have plenty of time to play by the old rules and squeeze consumers for all they can.
Although the provisions of this law are intended to help protect consumers, there are some potentially negative consequences to be prepared for. First, if you are a consumer that pays the full credit card balance each month and takes advantage of cash-back or airline rewards, there is a chance that your bank will impose an annual fee next year to make-up for the losses they incur from this new law. Some rewards programs may be pared back with higher redemption rates and caps. Third, fewer promotional rates may be available.
Question of the Month: How Long Will Information Stay On My Credit Report?
The answers to this question are governed by the federal Fair Credit Reporting Act (FCRA). Positive information may stay on indefinitely, but generally is removed after ten years. Accurate negative information like late payments or collection accounts may remain on your credit report up to seven years and MUST be deleted at that point. Bankruptcies and unpaid tax liens may remain on your report for up to ten years. Judgements can remain until the record is satisfied. Keep in mind that although negative information may be on the report, the older it gets the less impact it has on the score, especially once the negative items become greater than two years old.
Giving Back: Supporting Our Communities - Mitchelson Scholarship Foundation
High school graduation season is upon us. Once again, the Larry Mitchelson Scholarship Foundation will be selecting an aspiring art student to receive a cash award to help them pursue higher education. Previous winners are profiled on the foundation web site. As the students progress in their career they can submit updates and pictures of their art work. Your generous donations can be conveniently made securely on the foundation Facebook page or use the mailing address on the web site.
Need volunteers? Do you have a fundraising event upcoming? Do you have a personal web site where you are raising donations for your cause? Submit the information to randy@mortgagebyrandy.com by the 5th day of each month and we will do our best to include your information in the next issue.
Traveling to New York City next week to work with Chris Coulthrust, the smartest person I know. Our annual Fourth of July fireworks viewing party will be July 3 in Estero. Then, on to Nashville July 17 for the Michelle's Angels Tribute Concert! If you love great live music, celebrating with fun people and contributing to a great cause, join us the weekend of July 17 for a one of a kind concert at The Listening Room in downtown Nashville. Less than 200 seats are available and tickets are FREE. Contact me to reserve yours seats!
Randy
_____________________________________________________________________________________
Mortgage by Randy newsletter, Copyright 2009 Randy Mitchelson. All Rights Reserved.
Randy Mitchelson is a licensed mortgage professional. All material presented herein is believed to be reliable but we cannot attest to its accuracy. All material represents the opinions of Randy Mitchelson. Recommendations may change and readers are urged to check with their financial advisors before making any decisions. Opinions expressed in these reports may change without prior notice. Mitchelson can be reached at 239-851-6738.
____________________________________________________________________________________
You have permission to publish this article electronically or in print as long as the following is included:
Randy Mitchelson, of Estero, Florida, is a business professional, entrepreneur and author with over 15 years experience in financial services. Mitchelson has served in leadership roles for Global & Fortune 500 firms like Bank of America, KeyBank and CIBC.
As a member of National Association of Mortgage Brokers, Randy has earned the Lending Integrity Seal of Approval. He educates both individuals and groups about credit scoring by conducting personalized credit report reviews, action plans and one on one consultations. He is author of the free monthly newsletter, Mortgage by Randy as well as the Daily Dollar newsletter. A licensed mortgage professional, Mitchelson also founded Trinity Home Financing, LLC.
He is owner of Estero, Florida based National Web Leads, LLC, an internet lead generation service matching consumers with lenders for auto, cash advance and other loan products. Through its network of partners, National Web Leads delivers innovative Web 2.0 software solutions such as lead generation platforms and real time desktop widget and mobile reporting tools for lenders and internet marketers.
Mitchelson earned his BS and MBA at Rensselaer Polytechnic Institute in Troy, NY. He is a founding member and Finance Chairman of the Southwest Florida Regional Technology Partnership Inc. and Vice President for the Michelle's Angels Foundation Inc. He is married to Susan, a Pharmacy Supervisor in the Lee Memorial Health System in Fort Myers, Florida.
Comments(0)