Archive for December, 2007
The recently passed Bankruptcy Abuse prevention and Consumer Protection Act will make it harder for people with problem debt to have their debt eliminated through filing for bankruptcy. This new legislation will make it harder to have debts wiped out by the courts, and will require more debtors to pay back some or all of their debts. Considered by many to be a gift from Congress to the major credit card companies, this new law has many people rightly concerned about how to best deal with their debt problems. An additional concern that few have considered is that it not only will be more difficult to file for bankruptcy, it may also be difficult to find legal assistance once the new law takes effect in October, 2005.
Under current law, filing for Chapter 7 bankruptcy for consumer debt is a fairly routine procedure. A Chapter 7 filing allows most debts to be eliminated once the debtor demonstrates that they cannot pay their bills. While it is and should be considered a last resort for those in debt, a Chapter 7 filing allows those who emerge from bankruptcy to have a “fresh start.” Legal costs vary for assisting with a Chapter 7 filing, but they typically involve only a few hours of billing time on the part of an attorney. Under the new legislation most filers will be forced to file for bankruptcy under the more complicated Chapter 13. A Chapter 13 filing, which requires the structuring of a repayment plan, is somewhat more complicated and generally costs two to three times as much in legal fees. Adding to the complication is the fact that the new legislation will hold the attorneys for those filing for bankruptcy liable for paperwork issues, leaving the attorneys vulnerable to lawsuits from both bankruptcy trustees and the customers on whose behalf they file.
What this means to the consumer is that good legal help will be expensive and hard to find once the new bankruptcy law takes effect. Attorneys who specialize in bankruptcy cases will undoubtedly raise their rates significantly in order to offset their greater risk. Attorneys who seldom work on bankruptcy cases may simply stop handling them, thinking that the additional risk of a lawsuit isn’t worth their trouble. Anyone who is currently experiencing debt problems, which might require the help of a bankruptcy attorney, should probably meet with one now. It is better to find one now, even if you don’t need one, than to need one later and realize that you cannot find one.
©Copyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to debt consolidation and credit counseling, and StructuredSettlementHelp.com, a site devoted to information regarding structured settlements.
I saw the ads in our small-town newspaper for years before I realized exactly what was going on. They were always the same: A house for sale with 5% down and payments of 1% of the purchase price. It might be a three bedroom home for $90,000, for example, with $4,500 down and $900 per month payments.
A friend started doing the same thing and explained the process to me. It was a way to get a great return on capital. It was the opposite of buying with no money down. You bought for cash.
A Real Estate Investment Formula
It is simple, really. When you buy for cash, you often get a much better price. A house that needs a little work might be worth $75,000, for example. By offering $65,000 cash, you negotiate your way to a $68,000 purchase price. If not, you walk away – there are always others.
Then you put few thousand into high-return repairs and improvements. Paint, carpet, and maybe asphalt for the dirt driveway. For our example, we’ll say you put $5,000 into it.
Now it’s worth $85,000 perhaps, but you target those who can’t get financing easily, and you finance it yourself. By making it easy for the buyer, you can get $90,000 for the home – and do it without a realtor’s commission. Whatever the sales price, you let the buyer put 5% down, and make monthly payments of 1% of the purchase price. Of course, you get higher than market interest too.
The buyer is thrilled that they can buy instead of renting, and you get a capital gain of perhaps $14,000 after expenses, plus good interest. Your total rate of return is somewhere over 25%!
The first to do this cosistently in our town were a father and son. They were both lawyers, and saved money by doing their own foreclosures when necessary. After forclosing, they just raised the price and sold it all over again, of course. By the way, if you can get an average return of 18% on your money, you’ll turn $75,000 into more than one million dollars in about fifteen years.
Steve Gillman has invested real estate for years. To learn more, and to see a photo of a beautiful house he and his wife bought for $17,500, visit http://www.HousesUnderFiftyThousand.com
The power of home equity and interest-only payments, provided from most home equity loans is amazing. You can get a home equity loan, with no closing costs and pay as little as $30.00 to $40.00 per month for up to $10,000 in equity cash. These loans are surprisingly easy to get for both residential and investment real estate.
The terms on these amazing loans vary, but are quite nice. You can get them for up to 30 years, but they are usually completed in terms of 10 to 15 years. You can always pay just the interest on the loan – a very low payment, or you can pay on the principal loan, if you desire. You have all the power.
Another fantastic part of home equity loans is that in many cases you can take out 100 percent of the equity. So, if you owe $130,000 and your house is valued at $140,000, you can get $10,000. Now you’ll need good credit to do this. Not to worry, though, if your credit has some flaws. You can still get at your equity.
You’ll just get a little less, and you’ll probably pay a little more. And if you are told you don’t qualify, don’t despair; there is another way — a cash out refinance loan. A cash out refinance home loan gets at the equity you desire, but it puts a new first mortgage on your house for the entire amount, and you get the money that is left over. It may sound convoluted, but it really is not. Get the wealth building system Winning the Mortgage Game to learn exactly how it’s done.
Mark Barnes is an investment real estate and real estate finance expert. Get his free mortgage finance course at http://www.winningthemortgagegame.com and also learn how to gain financial independence through proper real estate investment strategies. Mark is also the author of the new novel, The League, a shocking, sports-related conspiracy. Learn more about his suspense thriller at http://www.sportsnovels.com
Recently passed by Congress with overwhelming support, the oddly-named Bankruptcy Abuse Prevention and Consumer Protection Act was designed to eliminate “bankruptcy of convenience.” The perceived problem is that many compulsive gamblers, shoppers and drug users often run up huge debts on easily available credit cards with no intention of paying their bills. A relatively easy bankruptcy filing through Chapter 7 of the Federal bankruptcy code wipes all the debts clean and gives the debtor a fresh start. Studies would suggest that most people who file for bankruptcy are actually suffering from sudden illness, job loss or some other catastrophic event, but the law was passed just the same, and debtors will now have to repay at least a portion of their problem debt when the new law takes place in October, 2005.
A provision of the new law that was not well publicized is the fact that the law applies to any debt, including debt which has been incurred through theft of the debtor’s identity. If someone steals your credit card, or driver’s license, or both, and runs up a huge amount of debt by posing as you, then you will be held responsible for the debt. Identity theft has become an increasingly large problem in the last few years, but the new legislation should make everyone aware of the problem associated with identity theft. While a determined thief can probably steal anything, a few simple steps can make it harder for someone to steal your identity.:
A few simple steps, practiced regularly, can protect you from identity theft. More importantly, these steps can protect you from having to repay thousands of dollars of debt that some thief might run up in your name. Your identity is your most valuable asset. Protect it carefully.
©Copyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to debt consolidation and credit counseling, and StructuredSettlementHelp.com, a site devoted to information regarding structured settlements.