I've got a problem with the Mortgage Modifications

I've been reading a lot about these mortgage modifications and how they are supposed to be helping keep Americans from losing their homes to forclosure. I've truly believed that a majority of the people who are seeking these modifications had no business getting these loans to begin with.

Anyways......now I have the numbers to back up the issues I had with mortgage modifications:

"a recent report issued by the U.S. Comptroller of the Currency (OCC) found that 53% of borrowers who had their mortgages modified in the first half of 2008 were already at least two months" (CNNFN.COM)

Why, you ask? Why are half of the loans that are being modified going right back into distress and foreclosue? Because all that the government and the banking institutions are doing is dealing with the product and not the real issue at hand which I believe is the actual consumer and their spending habits. The history of consumer debt and paycheck to paycheck living proves that most people are always going to live beyond their means!

To fix any issue you have to go to the root of the problem! I believe the roots to this problem goes all the way down to the the lack of financial literacy being taught in our school systems. Ignorance is very dangerous. You show me a person who is ignorant of a certain fact and I'll show you a person that I can manipulate!

We have to teach financial literacy to our children, teens and college students! And you have to take charge and be proactive as a consumer and learn as much as you can! Go buy a book, take a class! It's never to late to learn! Modifications are more like bandages on a scab that keeps on getting picked!

What are your thoughts on this, do you really think modifications are the answer?

Carlos Frank
Your Personal Financial Coach
http://www.nextmoneystep.com

You might be a slave and might not even know it!

The rich ruleth over the poor and the borrower is servant to the lender!
Proverbs 22:7

Very strong words and no matter what your belief, very true if you think about it! Let's see what happens when you sign up for a mortgage, car loan, line of credit, credit card, charge card, HELOC, Prime Equity Line, Personal loan, Pay day loan...........

1. The lender tells you what date you must pay them by (due date)
   
2. The lender tells you how much to pay them (minimum payment)
   
3. The lender tells you how you can pay them
   
4. The lender tells you for how long you will have to pay them (Loan term)
   
5. The lender tells you how much interest you will pay back (APR)
   
6. The lender tells you that if you don't pay there will be consequences (repo, foreclosure)
   
7. The lender has the right to review your credit pretty much whenever they want
8. The lender has the right to make adjustments to the "debt product" you have (just read the fine print. Ever had a credit card interest go up?)
9. The lender can even punish you for paying your loan off early! (Prepayment Penalty)
10. The lender will sue you if you don't repay

Sounds like slavery to me! That's why I call getting into debt "Volunteer Slavery!" This is evidenced even more with the current bailout talks! Debt is a banks and this countries #1 product. They say we must have this bailout so banks will lend money out again! So they are saying that if banks aren't freed up to get people like you and me, businesses and even governments in more debt that the economy will crash! WOW.......think about it!

Harritet Tubman said: “I freed a thousand slaves I could have freed a thousand more if only they knew they were slaves.”

Do you know? Don't you think it's time to live Debt Free & Prosperous?

Carlos Frank
Financial Coach
Email: carlos@nextmoneystep.com
Website: www.nextmoneystep.com

I Support a Bailout Plan

I can't watch the news or listen to the radio for more than 5 minutes without hearing about the current state of our economy! Gas prices are high, real estate is slow, banks are closing, foreclosures and this $700 Billion bailout that people either strongly appose or support.

My opinion: I strongly support a bailout!
But I'm not talking about $700 Billion Government Bailout, I'm talking about each household in America putting together their own personal economic bailout plan together and bail themselves out of bad personal financial decision making! Here's the thing, no matter what the government decides to do, government bailout or no government bailout, at the end of the day you still have to control your own personal economy! YOUR HOUSEHOLD BUDGET!

Here's a Personal Economic Bailout Plan:

Money Step 1: Get your financial house in order
Money Step 2: Save $1000 for an Emergency Fund
Money Step 3: Payoff all your consumer debt
Money Step 4: Build Saving to 3-6 months of living expenses
Money Step 5: Save 15% towards Retirement
Money Step 6: Save for College
Money Step 7: Payoff your Mortgage


So my question to you is: These type of economic cycles come around about every 10 years, what are you going to be doing different financially when/if this happens again?

Live Debt Free & Prosperous!