The White House Reveals the Housing Plan

There has been a lot of debate concerning the housing bailout plan. Many details of this plan have not been revealed…until now.

Details about exactly “who” and “when” are now being released by President Obama and his administration. The new plan is geared to help over 9 million homeowners stay in their homes. How will this happen? Struggling homeowners will be able to refinance their mortgages into new mortgage programs that have lower monthly payments.

This new program, also know as the “Making Home Affordable” program, has already been extremely popular among homeowners. Many homeowners, who have been struggling for several months, say that the new program is welcomed news.

Here’s an interesting point to consider however. Homeowners who have been hit the hardest by the crash of the housing market won’t be affected by the bailout plan. That’s right…homeowners who own their primary residence in Arizona, Nevada, California and Florida aren’t likely to qualify for the “Making Home Affordable” plan.

The Obama administration and other government officials predict that “tens of thousands” of homeowners who need the help the most, won’t be able to qualify for it. Instead, the housing bailout plan is only a small step in the right direction. The Obama administration has made it very clear that the plan is targeted to help “responsible” homeowners.

There is another factor to consider, here’s the marketing analytics: not every bank and/lender is going to be participating in the program. However, the plan is twofold. One aspect of the plan deals directly with banks and lenders. Up to 4 million homeowners will be assisted in this aspect because the government will work with the lender to modify existing troubled mortgages. The government will also work with the other 5 million homeowners to refinance their existing mortgages into more secure, fixed-rate loans.

Here’s what you need to know if you are interested in this program:

1. Eligible homeowners must provide a copy of their most recent tax return
2. Eligible homeowners must provide two of their most current pay stubs
3. Eligible homeowners must provide an “affidavit of financial hardship”
4. Eligible homeowners can only have their mortgage modified one time
5. The loan modification program runs from March 4, 2009 until 2012
6. The loan modification program affects mortgages made on or before January 1, 2009
7. Single-family residences that are worth more than $729,750 are not eligible for the program

Finally, there are some specific details about President Obama’s housing plan. If you are a homeowner that is struggling to make your mortgage payment, check into the details of this plan. This could be just what you have been waiting for.

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Have You Considered Swapping Your Home?

Have You Considered Swapping Your Home?

More and more people have been affected by the current housing crisis. Millions of homeowners are unable to sell their home for as much as they owe on it. Millions more simply can’t make their mortgage payments. However, a new real estate trend is sweeping the nation and this one has real estate agents stumped.

The trend is home swapping. You read that right. Home swapping. Here’s how it works: One potential home buyer wants a bigger house. One potential home seller wants a smaller house. The buyer can’t get necessary funding without selling their primary residence first. So, the buyer and seller simply “sell” their houses to each other. Each of the closings would have to happen almost simultaneously in order to avoid any sort of financing hang-ups.

Believe it or not, this trend is sweeping the nation. Of course, both the buyer and seller have to agree to the terms of the swap. Similarly, both the buyer and seller end up being both a buyer and seller of one another’s home.

There isn’t really a way to track how large of a trend this is becoming because the National Association of Realtors does not keep track of home swaps in its annual averages. Stephanie Singer, of the National Association of Realtors, said, “We haven’t seen this happen on a very big scale. It can be a very complex transaction, especially if you’re crossing state lines.” However, no one can be certain how often this is happening.

There have been home-swapping websites created to facilitate such transactions. MK HomeSwap, GoSwap.org, Domuswap.com and OnlineHouseTrading.com are some of the most popular home swapping websites out there.

Areas that have been hit the hardest by the housing collapse are also the areas that are seeing the most swapping. Southern California, Arizona, Nevada and Florida are home to many home swaps per year. This is proof that homeowners are getting creative, especially when they have been hit hard by the housing market.

If you have been experiencing problems with your current mortgage or have had a hard time selling your home, you might want to consider listing your home on a home swap website. It may be your only opportunity to get out of your current mortgage without losing money on the transaction.

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Which Retailers Are Bound For Bankruptcy

We, as a country, have already watched several big-name retailers go out of business. Mervyns, especially, comes to mind. Mervyns was a department store that sold products for low prices. Where are they no? Non-existent.

The retail industry is probably the most vulnerable right now. Customer analytics shows consumers are spending less and less of their valuable income on non-necessity items. Retailers spend over 10 years in an atmosphere that encouraged consumers to get into debt.

Now, consumers can’t get the same financing they could a few years ago. American families have had to cut back in every aspect of their lives, including unnecessary spending.

Large financial lenders have had to cut back their lending to retailers as well. Wachovia, GE Capital and CIT Group (some of the retail industry’s biggest lenders) have had to tighten their lending terms. Their reasoning is to reduce the exposure to nationwide retailers. These terms have made it much more difficult for retailers to “find capital to reorganize under bankruptcy-court protection.”

So, what does this all mean? There are likely to be a lot more retail liquidations in the coming months.

Circuit City Stores filed Chapter 11 bankruptcy protection in November. On January 9, the electronics superstore said that it faced possible liquidation if an acquisition or cash infusion deal didn’t work out.

Goody’s Family Clothing recently announced that it will be liquidating all of its remaining 287 stores. This announcement came just three months after it “exited” bankruptcy status.

Against All Odds USA, a clothing chain, also announced that it will enter Chapter 11 protection. It will enter this protection in hopes of being sold or being reorganized.

Standard and Poor’s recently reported that nine major U.S. retailers and restaurants face a significant risk of default. Among these are Loehmann’s Holdings, Duane Reade Holdings and Finlay Enterprises. One year ago, S&P had only six companies on its list.

Michael Henkin, managing director and co-head of the restructuring group at Jeffries said, “A lot of retailers survived through the holiday season because they built up their inventories in the summer before anyone, like their vendors, knew it would be this bad. But now you will see a lot of filings.”

Loehmann’s President, Robert Glass, said, “We have sufficient cash to sustain our operations, and pay the interest on (our) notes. Our parent has put money into the business, and has continued to be very, very supportive.”

Many of the retailers that are in grave danger of being liquidated say that they are “comfortable” in their current position. But, the fact of the matter is that many of these companies will be out of business by the end of 2009.

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Which Credit Card Fits Your Style

Everyone has different “taste.” This “taste” includes taste in food, clothes, home decor, furniture, etc. Afterall, that is what makes this world such an interesting place. But, did you know that consumers can get different credit cards according to their individual style.

The biggest indicator of your credit card style is the way that you were raised. Sound bogus? Let me explain…

When you were growing up, you probably intently watched how your parents handled their finances. Whether you realize it or not, you probably handle your finances much of the same way you saw your parents handle theirs. For instance, did your parents primarily use their credit cards to make purchases? Is that the same way that you handle your expenses and purchases? Chances are that your financial style is the same as your parent’s financial style.

Your financial style can predict what type of credit card you use. There is a countless array of credit card types out there. These include:

-instant approval credit cards
-High interest
-Low interest
-Cash back
-Travel rewards
-Rewards credit cards
-Annual fee credit cards
-Etc, etc, etc

So, which type of credit card fits your “taste” or financial style? Let’s take a look.

If you use your credit card for everyday purchases and make sure to pay off the entire balance every month, you will be better off with a reward-based credit card or a cash back credit card. You have the opportunity to rack up the points, without paying a dime of interest.

If you do a lot of traveling, either for your personal life or for your business, you might be better off with a travel reward credit card. Each time you use your credit card, you can earn points that can be used the next time you travel. You can either use these points frequently or save them. The more points you save, the better chance you have of paying for your next trip entirely with your reward points.

If you don’t pay off your entire credit card balance every month, you are better off with a low-interest or no-interest credit card. This will minimize your payments and the amount you will end up spending on interest.

Make sure you fully understand all of the ins and outs of your credit card terms. It is also extremely beneficial to understand what your credit card “tastes” are. This way, you can carefully choose a credit card that will benefit you and your finances the most.

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