What To Do If You’re Underwater on Your Mortgage

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The falling home values that came with the mortgage market crash and recession have resulted in a number of homes showing negative equity. These underwater mortgages could possibly put a strain on the economy if they result in foreclosure. However, it is not a foregone conclusion that foreclosure will result when you have negative equity.

For the most part, those at greatest risk of foreclosure due to being underwater are those who have run into financial problems and can’t get a refinance because of their negative equity. If you are underwater on your mortgage, you have more options than you might expect. Here are 5 possibilities for your financial situation if you’re underwater on your mortgage:

  1. Keep making your payments: If you can afford your mortgage payment, and you aren’t planning on moving anytime soon, it might be worth it to just keep making your payment. If your home serves as shelter, you are comfortable in it, and your financial situation is reasonably secure, eventually you will no longer be upside down. You will pay off your mortgage eventually, and then you will own your home outright.
  2. Mortgage modification: You might qualify for mortgage modification. This can be helpful if you are having difficulty making payments. At the first sign of trouble, contact your mortgage lender to apprise them of the situation. If you qualify for a mortgage modification, things could work out so that you end up with a payment you can afford, allowing you to stay in your home.
  3. Sell the house: If you can find a cheaper situation, it can make sense to sell the house. You will have to do a short sale in order to do this if you have negative equity. In a short sale, the bank accepts less than you owe for the house. You are either forgiven the difference (watch out: the IRS considered this taxable income), or you are offered an unsecured loan for the remaining amount, and you make smaller payments on this smaller loan.
  4. Strategic default: Some who are underwater on their mortgages, and who feel as though they can’t make payments and get out of the problem, are choosing to walk away, rather than stick it out. Of course, your credit will be in danger with this option. However, you can still live in your home until the bank forecloses, and you can save up some money since you won’t be making payments anymore.
  5. Bankruptcy: Another option is bankruptcy. If you have a lot of other debt, and you have assets in retirement plans, this could be an option. If you keep current on your mortgage, you might even get to keep your house as you restructure the rest of your debt. But your credit will be completely trashed for the next seven to 10 years.

Before you go forward with any of the above options, though, it might be worth it to consult with an attorney, as well as a financial professional. You want to make sure that you understand your options, and the implications of your actions.

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What Do YOU Want Out of Retirement?

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One of the essential issues of personal finance is that it is vital that you consider what you want out of life, and how you can use money to reach those goals. Money really is more of a means to an end, and it is vital that you consider what you want out of retirement. As you plan to retire, and begin saving money for that not-as-distant-as-you-might-think day when you want to leave the rat race, the first thing you need to do is figure out what you want out of retirement. It may sound selfish, but if you need take care of you first. If you don’t know where you are going, and why you are going there, you can’t create an effective financial plan. And retirement is a pretty big financial destination.

Deciding What You Want Out of Life

For every person, this is different. Do you really want to fully retire, or would you like to maintain a part-time job for the social interaction? What sort of job would you like? Is your style more about traveling around? Do you want to visit your grandkids and have them come see you? Are you interested in learning new skills and participating in hobbies? Do you want to leave a legacy, establishing a foundation that can enrich others’ lives? Perhaps you want to do a little of all these things.

Take a few minutes to examine your values, goals and desires. Figure out what is most important to you, and what you would like to do with your life (and your money) as you age. Write down a few goals, and discuss your desires with your life partner (since you are likely to be in retirement together). Create a plan for your retired life, based on what you want to get out of it.

Creating a Plan for Retirement

Next, you need to create a plan for the retirement you want. Look at what you would like to accomplish during retirement, and estimate how much of a monthly income would be required to support you in that lifestyle. Consider sources of income that you are likely to have. Some sources of income during retirement include:

  • Part-time job.
  • Business venture.
  • Residual income from web sites and online business.
  • Royalties on creative efforts.
  • Income from non-retirement account investments, such as from dividend paying stocks and from the interest from bonds.
  • Income from retirement accounts.
  • Reverse mortgage (but remember it’s actually a loan).
  • Social Security (but don’t get too dependent on that).

While you probably won’t have access to all of the above income streams, you can start now to cultivate the income streams that can help you to reach your goals in retirement. Now is the time to contribute as much as you can to retirement accounts, and also to look at building your income investing portfolio. You can even establish a business now, either brick-and-mortar or online, to grow and provide some income for the future.

Whatever you do, though, it requires planning a certain degree of number crunching. When creating a portfolio designed to help you get what you want out of retirement, it is vital that you consider some level of diversification, including stocks, bonds, cash and maybe even some other investments. You should also be wary of relying on any one source (including a day job) for all of your income. And, of course, as horrible as it may sound, you should plan to take care of your retirement needs before contributing to your child’s 529 college savings plan. Make sure your retirement is shored up first, since you can’t get the same kind of loans for retirement that your kids can get for an education.

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What Did Your First Job Teach You?

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Your first job can provide valuable lessons, even if you think of that first job as mundane. If you are willing to approach a job with an open mind, you might find that it can teach you more than you thought.

My first job, at the age of 16, was working as a cashier at a local craft store. I’m not entirely sure why the guy hired me, since I knew (and still know) nothing of crafts. But I did pass the math test he gave me with flying colors. I suppose he figured that someone else who knew about crafts would be on hand to provide real help, and all I needed to do was run the cash register and clean things up a bit.

This job taught me some valuable lessons:

  • Hard work and competence can be rewarded.
  • Money management skills are important. (My parents had me start paying for some of my own “fun” things after I got my first job.)
  • I didn’t like working for someone else.

My second job, which I got after a year of having difficulties getting time off for extracurricular activities, was teaching piano lessons to children. It was nice to set my own schedule, even though I had to adhere to it pretty strictly after setting it. But at least I could take my extracurricular activities into account, and schedule lessons for a day of the week that was more convenient. I learned that, even though I didn’t make as much money teaching piano lessons, I enjoyed my job more (even though I’m not fond of teaching). I learned that money isn’t everything, and that sometimes there are non-monetary considerations when you look for a job.

The Importance of Work When Young

I think, though, some of the most important lessons learned while working as a teenager had to do with money management. Sure, my parents paid for my food, shelter and most of my clothing. They paid for a good portion of my extracurricular activities as well. However, once I got a job, I became responsible for some of my own expenses. This was a valuable experience for me, since it taught me the importance of financial planning — and of making decisions about what I spend my money on. (Sadly, I learned firsthand about the dangers of debt in college.)

Having a job also taught me to value my own work, and what I put into something. I learned the value of a dollar, and I also learned, quite early, that different jobs pay different amounts of money. My hourly pay for teaching piano lessons was more than twice what I made at the craft store. This taught me that you can turn your skills and talents to profit. At the craft store, I knew nothing. I was making minimum wage as an inexperienced and unskilled worker. However, I was proficient enough on the piano to teach beginning lessons to children. My skills in that area were in demand, and I could turn that into cash flow.

Many of us in the personal finance world debate whether or not we should encourage our children to get jobs. I think that it is a good idea. It can begin teaching them valuable lessons early — lessons that will stand them in good stead down the road.

What was your first job, and what did it teach you?

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Wells Fargo Online Banking | Peak Personal Finance

Banking today is about more than just having a reliable place to put your money. It’s also about convenience and easy access. Today at Peak Personal Finance, we’re going to talk about online banking at Wells Fargo Bank.

Wells Fargo is one of the four major banks in the United States and offers a diverse range of financial products. Wells Fargo Bank online banking has become a major part of the company; it is in fact the main resource center for people that are interested in using the services of the company.

Wells Fargo online banking is done through the website of the company. Wells Fargo has created a massive website with easy-to-use features and crisp and clear Graphic User Interface.

Wells Fargo banking online offers a variety of services that are provided over the internet. Some of the most popular ones are described below.

Online account opening is an important feature of Wells Fargo Bank. Under this feature, customers can open all types of accounts including general checking, savings, certificates of deposit and money market accounts. The procedure of account opening is simple as the customer has to complete a basic online form with his/her address, zip code, phone numbers and other details. Payment can be easily made through credit cards.

Wells Fargo interest rates are determined after taking into account the general market conditions and other factors, including federal regulations and global economic situation. Wells Fargo post all of its interest rates on its online banking sites and also elaborates the rates for CDs, savings accounts, checking accounts, money markets and other investment options. Wells Fargo maintain an active online chatting feature along with 24/7 helpline.

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Wells Fargo Mortgage Rates | Peak Personal Finance

While we haven’t looked at Wells Fargo mortgage rates directly in a review article like this, we have looked at them before and at Wells Fargo’s newly-acquired bank property, Wachovia mortgage rates. Not long ago, we also did a “best of” for national mortgage rates that had Wells Fargo mortgage rates ranking high.

So we decided it’s time for us here at Peak Personal Finance to have a look at Wells Fargo home loans directly and show you what they offer for mortgage rates at Wells Fargo Bank.

For these Wells Fargo Bank mortgage rates, we’re assuming a $150,000 home with a $140,000 loan and that the buyer would have good credit (700 score) and enough money to pay all of the fees associated with the loan (about 8% of the total loan). With that, we got some good Wells Fargo mortgage rates you’ll want to see.

For a 30-year fixed Wells Fargo home loans rate, the annual percentage rate (APR) is 7.247% (5.75% interest) and for an FHA 30-year the rate is 6.775% APR (6.00% interest). On a shorter 15-year fixed Wells Fargo Bank mortgage rates would be 6.393% APR (5.250% interest).

For adjustable rate mortgages (ARM), which are the right choice for many home buyers, even in today’s market—talk to your financial advisor before making a decision, of course—the rates are also pretty good.

For a 5-year ARM, the mortgage rates at Wells Fargo Bank are 5.886% APR (5.125% interest) and a 5-year ARM FHA is at 4.618% APR (5.625% interest).

All of the loans here have Wells Fargo home loans rates low enough to keep the payment under $1,300/month, with three of them under $1,000. Those are good Wells Fargo mortgage rates!

Check your local requirements, of course, and be sure to talk to an advisor before locking in a new home loan, but definitely put Wells Fargo Bank mortgage rates on your list to consider.

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Wells Fargo Bank Online Banking

Today, as promised, we here at Peak Personal Finance are going to show you how well the Wells Fargo Bank electronic banking stacks up in today’s competitive world.

First, the Wells Fargo Bank online banking site is full of useful content and information for everyone from first-time home buyers to experienced users looking for the latest rates or newest offers. The bank has obviously put a lot of effort into filling the Wells Fargo online banking site with a lot of useful information.

While some of their marketing (advertising) on the site is a little overboard, it’s not so pushy that it pushes users away. No annoying popups or other advertisements are used, just a lot of graphical ads on each banking page.

Features of online banking at Wells Fargo Bank include the ability to open most account types through the Internet, so a new checking or savings account is no problem and starting a new CD is easy.

Along with the usual ability to check account balances, histories, and so forth, Wells Fargo Bank electronic banking also offers automatic bill pay and customer service options beyond just email or phone.

For security, the Wells Fargo Bank Internet banking system has a full section on privacy and how your financial and personal information is protected by their system. Great resource that helps build a lot of confidence.

Wells Fargo Bank is, of course, fully FDIC insured. For customers of the bank, the Wells Fargo Bank electronic banking system is a great resource.

Wells Fargo Bank Online Banking June 2011

Wells Fargo is one of the leading banks in the US today and it has become much stronger after its merger with Wachovia Bank. They offer numerous products and services to customers who are located across the length and breadth of the country. One of the nicer aspects of banking with Wells Fargo is their online banking feature. It makes it convenient for customers to perform all their banking transactions without ever having to find the nearest branch and travel physically to get their job done. Wells Fargo Internet banking is also a great boost for the elderly, disabled and for those who live in remote places. All that they need to access their accounts is a computer and Internet connection.

Wells Fargo online banking helps customers to check their account balances using their computer and Internet. They can do it anytime of the day or night as this feature is available around the clock. Also, customers can check the balances of different accounts, view check images and even download monthly statements to their computer. Checking their account activity constantly helps them to stay on top of their spending and provides a good measure of financial control. They can even choose to sign up for email and text message alerts regarding their accounts.

Wells Fargo electronic banking makes it possible for customers to transfer money within their different accounts and also pays their utility bills. Using the bill pay option, they can schedule a day to pay their bill and the bank will complete the transaction for them. Online brokerage is available for selected customers and customers can make use of them for their investments.

Wells Fargo Bank Online Banking April 2012

This is a Wells Fargo Bank internet banking service review to help keep you informed on just what this financial giant has to offer the American public. This is the same bank that started with the symbol of a stagecoach back in 1852. Today, they are still providing financial services for customers across America.

The Wells Fargo Bank online banking services are what you would expect from one of the power houses in the financial sector. With this service, customers can view their account balances, transfer funds, and verify recent transactional history. There is even a My Money Map program designed to help you keep track of your money and how you spend it. All of the access to your accounts is free with no hidden fees.

The Wells Fargo Bank electronic banking services are available for those with a checking account. This includes the online bill paying service. With this service, you can literally pay anyone in America any amount you have on deposit in your account. This can be a onetime occurrence or they can be scheduled in advance and happening on a recurring basis.

You can set up alerts to be notified when a bill is due. You can even have your bills sent directly to Wells Fargo Bank through their eBill service. This allows you to have all of your bills in one place all of the time for you to manage online.

This is a free online banking service for those with a total deposit of $5,000 in qualifying accounts. If your balance is below that, there is a $6.95 a month service fee assessed to your account.

You can also check out Wells Fargo Bank certificate of deposit rates here at Wells Fargo Bank CD rates.

Wells Fargo Bank CD Rates

Today at Peak Personal Finance, we’re going to focus on Wells Fargo Bank certificate of deposit rates. Tomorrow, we’ll look at how their online system stacks up for banking customers.

To begin with, there are four special offers in Wells Fargo CD rates to consider. Each requires a $5,000 minimum deposit to open and maintain.

For a 10 month term (renewing for 6 more), a 0.20% annual percentage yield (APY) is offered. For 26 months (renews for 24 months) a 0.65% APY is given. For 45 months (renews for 36 more) a 1.40% APY is offered and for 58 months (renews for 48 months) a 1.90% APY is given.

Other standard rates include a 3 month term at 0.05% APY with a $2,500 minimum deposit requirement. A six month term gives 0.10% APY and requires a $2,500 minimum deposit as well. Finally, a 1 year term offers a 0.15% APY with that same $2,500 minimum deposit.

These Wells Fargo Bank CD rates are not very competitive against other nationally-available CD rates. The special offers have the best CD rates of this list, but are still not necessarily better than what others like Ally offer – without the required renewals.

Wells Fargo Bank is, of course, FDIC insured. If any of the Wells Fargo Bank certificate of deposit rates listed above do appeal to you, lock in your CD rates today before they change.

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Webster Bank Online Banking June 2011

Webster Bank was founded in 1935 by Harold Webster and since then it has grown to a considerable size. It services customers who live in Westchester Country, NY, Connecticut, Rhode Island and Boston, MA. With about 3000 employees and 181 banking offices, it provides a range of products and services to their customers. Also, Webster online banking is available for all customers and it is a convenient way to access their accounts.

Webster Bank internet banking makes it possible for customers to check all their accounts in one place. They can see balances, check account information and monitor transactions of checking account, savings account, CDs, credit cards, brokerage accounts and even mortgages and other loans. The images of checks and deposit slips can be viewed online and this helps customers to have a better control over their finances. Besides, monthly statements for the last 18 months can be seen online. However, for loans, this is restricted to 12 months.

With Webster Bank electronic banking, it is easy to transfer money between different accounts. It is also possible to transfer money from Webster account to external accounts such as funding a college account or making a loan payment or funding another Webster account. Another advantage is that customers can pay bills online through the online banking facility. They can set-up one-time transfer or recurring transfers on a date of their choice and on that specified date, the transfer will be done automatically by bank. This makes it a hassle-free way to make bill payments without ever having to worry about late fees or postage charges.