Mortgages and Real Estate

Sallie Mae student loan captures student in call-center rabbit hole

Fruzsina Eordogh Mar 16th 2010 @ 12:00PM EST Filed Under: Borrowing, Money College

Money College writer Fruzsina Eordogh chronicles her ongoing struggles with the student loan giant Sallie Mae.

The three-month deferment I paid $150 for from Sallie Mae has run out and so I began the dreaded robot call center run-around that is Sallie Mae's customer service. I hung up a couple of times because I got lost, and I became frustrated when every time I called, the automated woman on the answering service would tell me my total amount due, and that I was late, and somehow because I was out of deferment I owed two months' worth of payments.

Pressing "0" repeatedly does not help until you get to a certain menu (and I can't even tell you which one that is) and the option to speak to an agent is conveniently the last one given. I heard it the third time around, and I pressed "0" with such happiness you'd think my loans were being forgiven.

Continue reading Sallie Mae student loan captures student in call-center rabbit hole

Low cost FHA-backed housing loans likely to continue

Charles Feldman Mar 11th 2010 @ 5:00PM EST Filed Under: Borrowing, Home, Real Estate, Personal Loans, Mortgages

Housing development Looks like low cost, low down-payment FHA-backed loans will be around for some time to come -- good news for potential home buyers, not such good news for those who argue that the more money borrowers invest upfront, the less likely they will be to walk away when threatened with foreclosure.

Right now, buyers getting home loans backed by the Federal Housing Administration can put down as little as 3.5% provided they meet certain financial guidelines.

Continue reading Low cost FHA-backed housing loans likely to continue

Money College: Sallie Mae preys on eager high school graduates

Fruzsina Eordogh Mar 5th 2010 @ 2:30PM EST Filed Under: Borrowing, Money College, Debt, School

Many people seem to be confused about my last post about Sallie Mae and student loans. I am not asking for a hand-out. I am asking that loans with interest rates above 7% (I will even concede to 8%) be deemed illegal.

You heard me: ILLEGAL.

There is absolutely no good reason why any loan taken out from any bank should have an interest rate approaching 10%. The interest rate for my loan should NOT be similar to the current unemployment rate in America. That high interest rate can be described as criminal in today's job market.

Continue reading Money College: Sallie Mae preys on eager high school graduates

Overdrafts are out: What does that mean for your preauthorized purchases?

Jean Chatzky Mar 4th 2010 @ 7:00PM EST Filed Under: Banks, Borrowing, Banking - Checking Account

Starting this August, if you try to use your debit card to make a purchase without having the funds in your linked checking account, that purchase will be declined. Right in the store. Or the restaurant. No longer will your bank be able to approve the transaction and then hit you with a $35 overdraft fee -- unless you decide that you want to be able to charge without having the funds, and opt in - signing on some dotted line to signal that you want this protection.

Now you have to understand that for the banks, these $35 fees add up to $20 billion in annual revenue. That's why The New York Times reported last week, that your bank is going to try to convince you to join this new party. It will try to raise your level of fear, using words like "protection," and "emergency," and sending letters like the one from Chase quoted in the Times story, which read:

"Your debit card may not work the same way anymore, even if you just made a deposit. Unless we hear from you. If you don't contact us, your everyday debit card transactions that overdraw your account will not be authorized after August 15, 2010 -- even in an emergency."

I, for one, will not be opting in. And I don't believe you should either. Fees like this (which, despite improvements in credit card legislation can still top the amount of your purchase) are outrageous. With the widespread (and typically free) availability of online banking, you ought to be able to keep close enough tabs on the money in your account that you don't overdraw. In most scenarios.

Continue reading Overdrafts are out: What does that mean for your preauthorized purchases?

More interest in reverse mortgages as seniors' home values improve

Diane Wedner Mar 3rd 2010 @ 9:00AM EST Filed Under: Borrowing, Real Estate, Mortgages

Seniors, whose home values have taken a particularly bad beating in the recession, take note: Light may peeking through the end of the tunnel.

After remaining flat or declining for seven consecutive quarters, older Americans' average home values stopped sliding late last year, according to data from Golden Gateway Financial, which tracks such information. The national average self-reported home value of older Americans rose from $369,762 in the third quarter of 2009 to $381,895 in the fourth quarter. Although home prices among the senior population are rebounding, they still remain steeply lower than 2008 levels.

While the news about national home values was upbeat in some regions, many large states, such as Florida, Texas and New York, still are reporting significant declines in prices. This mixed recovery reflects reduced inventory in some markets, while others still are flooded with homes for sale. But pockets even within these recalcitrant markets are showing a glimmer of improvement, according to the most recent S&P/Case-Shiller Price Indices, offering some optimism for seniors who rely on their homes to supplement or support their retirements.

"This is especially true for those considering a reverse mortgage, because as their home increases in value, so does their potential for greater reverse mortgage proceeds," said Eric Bachman, Golden Gateway's CEO.

Continue reading More interest in reverse mortgages as seniors' home values improve

Don't co-sign on a credit card for your college student

Zac Bissonnette Mar 2nd 2010 @ 2:45PM EST Filed Under: Borrowing, Credit, Debt, Credit Cards, 101 credit&debt, 101 banking

One of the results of the credit card reform legislation that recently went into effect was a dramatic change in the ability of college students to access credit. Anyone under the age of 21 will now need, according to the bill, "financial information. . . indicating an independent means of repaying any obligation" in order to sign up for a credit card.

What exactly that even means is ambiguous. Ben Woolsey of CreditCards.com tells WalletPOP that "The Federal Reserve hasn't explicitly defined income requirements but rather has left that up to the individual issuers."

Some banks may require a payroll stub or bank statement, and others may ask the applicant for the name of the employer and annual income. According to Woolsey, a full-time student with an annual income of $5,000 could "probably" qualify for a credit card -- but with a limit of no more than $500.

Continue reading Don't co-sign on a credit card for your college student

With credit drying up, where can you turn for student loans?

Geoff Williams Feb 17th 2010 @ 3:30PM EST Filed Under: Borrowing, School, Student Loans

Puzzles are often fun, but not this one: With credit scores plunging and loans in short supply, how do you go about paying for college these days?

It's a question you'd think might almost be easy for Scott Gamm. Granted, in many ways, he's just another high school kid, about to turn 18 and headed to college this fall (New York University's Stern School of Business). But in many ways, he isn't a typical high school kid: He's the founder of HelpSaveMyDollars.com, a personal finance website that he began in July, 2009.

Continue reading With credit drying up, where can you turn for student loans?

New vogue in refinancing: cashing in, not out

Amy Pyle Feb 16th 2010 @ 2:00PM EST Filed Under: Banks, Borrowing, Debt, Home, Real Estate, Recession, Investing, Mortgages, Refinancing

After years of viewing their homes as piggy banks to be plundered at will, Americans are finally putting some money back in, at least when they're refinancing.

According to new figures compiled by mortgage-funder Freddie Mac, in the fourth quarter of 2009, one-third of borrowers who refinanced their homes actually added cash to the deal to lower their mortgage balances -- a record number since the discount lender started collecting the data in 1985. On the flip side, just 27 percent of people refinancing their homes pulled cash out, which is the lowest number on record.

Continue reading New vogue in refinancing: cashing in, not out

Foreclosure "good" news may not be so good after all

Charles Feldman Feb 13th 2010 @ 9:00AM EST Filed Under: Banks, Borrowing, Home, Real Estate, Mortgages

If you are like many folks, myself included, you may have been in your car and heard a brief news item earlier about how there was a decline in foreclosures reported in January. And, if you are like many folks, myself included, you may have said to yourself (if, that is, you are the kind of person who typically likes to say things to yourself) that this is surely good news; another sign that a weak economic recovery may be picking up steam?

But to paraphrase the ancient rock group The Who, please, please, don't get fooled again!

Continue reading Foreclosure "good" news may not be so good after all

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