Feb 10, 2010     
I Looked in the Face of Fear Lying Down

I know, it doesn’t sound very courageous but let me explain.  Last summer my son and I embarked on our first cross-country drive, leaving the beautiful state of Washington with hopes of arriving in Tampa, FL within 6 days.  I had volunteered to be his co-pilot on his way to his first duty station at Mac Dill AFB.

It started out pretty rough as his friends decided to celebrate his last days and he crawled in at 4am.  My alarm went off at 4:30 and I decided his punishment was to drive the first leg of the journey to Ellensburg.  I recall he woke up as we hit Coeur d'Alene, ID.  We survived and made it to Hamilton, MT to stay the night with family. 

We were treated to a fantastic dinner at the Skalkaho Steakhouse.  This was a Montana restaurant you could imagine Jeremiah Johnson feasting at the next table.  Unfortunately, on the way back to the house we drove right over the top of a skunk in the road.  We did not kill it, but it sure got us.  The truck received a good dose of spray and the passengers in the back seat got the brunt of it.  Only in Montana! 

Staying with the Burke’s in their brand new, custom built log cabin was the icing on the cake.  What better way to stay the night in Montana?  We were sent off the next morning after a huge breakfast courtesy of Mari Jo.  Uncle Chunky gave us a new route to get to Rapid City that took us around the Rockies.  Kyle and I had never seen such beautiful country.  But again, as I was driving I could see a few miles up that something blocking the road.  Time for another Montana-moment, we were treated to a cattle drive up the middle of the road. 

Beyond that experience, it was pretty smooth sailing until we stopped for a visit to The Battle at Little Bighorn Monument.  We were both taken aback at the site and scenery.  I have to admit I misread the map and our Nuvi did not help.  I took Hwy 112 instead of I90 which would have been fine except that it was getting late in the day.  We found ourselves driving at night on a two-lane road through the mountains.  What’s so bad about that, you ask?  Well in Montana, at night the deer seem to migrate to the sides and/or the middle of the highway.  I am not exaggerating when I say we saw over 200 deer in a short period of time.  Try driving 60 with semi-trucks (who want to drive 75) crawling up your rear bumper and there are dozens of deer just waiting to jump out in front of you.  I wasn’t in Kitsap County anymore, Toto.

I think I have left out the fact that I have driven this entire time.   I felt safe with Kyle driving in our home state but not out here.  He was fine sleeping all day, listening to his iPod, and talking on his phone.  I got a horrible night’s sleep in St Joseph, MO but was still determined to drive.  I made it through Kansas City but finally handed the wheel to Kyle.  I slept through St Louis but woke to the sound of heavy rain pelting the windshield.  I sat up to witness Kyle driving 70 mph in a heavy down pour, playing the drums on the steering wheel, tail-gating the car in front of him, singing away with the radio.  He handled the hydroplaning pretty well but quickly fell back to his steering strumming, high speed suicide run (or so it seemed to me).

Fortunately for me I had a flash back.  I think God took me back to the age of 19 and reminded me of my road trips to the ocean with my buddies.  We must have thought it was the Cannonball Run.  We drove with no fear.  I drove just like Kyle was driving.  He wasn’t thinking of survival. He wasn’t wondering how much his life insurance policy was for.  He was living in the moment.

So I did what I had to do to survive.  I laid the seat back down, put my iPod headphones back on, turned the music up loud, closed my eyes and prayed!

We survived our cross-country trek and made it to Tampa a day early.  It is a trip we will always remember and will have many stories to tell.  Thanks for hanging in there with me.

Feb 9, 2010     
Life After Bankruptcy

Bankruptcy is an uncomfortable subject for a variety of reasons. The most obvious is the potential havoc it can wreak on your finances. Running a close second is the negative stigma which is often attached to the process. This negativity is important to mention because strong emotions can sometimes lead to unsound financial decisions with devastating results.

Bankruptcy becomes a viable option for someone who is “upside down” in terms of cash flow. In other words, when a person has more money going out each month than coming in, bankruptcy should be considered if no reversal of this negative cash flow is within sight. The longer someone waits to explore the various options available, the more serious his or her situation may become.

One of the worst things people can do in this situation is to borrow more money to try and pay off their debts. On paper, this is clearly an unwise financial decision. In the real world, however, it is very common for individuals to pursue this strategy in an attempt to buy time and hold off on filing for bankruptcy. On the surface, this is certainly a noble notion; however it can often compound the problem and serves only to delay the inevitable.

For many homeowners in the midst of this upside down cash flow, speaking to a qualified mortgage professional is a much better option. An experienced loan officer can objectively look at your finances and help you determine if restructuring your mortgage would not only help, but possibly even alleviate any need for bankruptcy.

If bankruptcy is the only option, seek out a reputable bankruptcy attorney and credit counselor. A qualified mortgage specialist can provide references for you as well, as he or she works with these professionals on a regular basis. Reliable references are essential in this case because experienced professionals greatly increase the odds of a successful bankruptcy experience. It’s that simple.

When filing for bankruptcy, be completely honest and accurate regarding every aspect of your financial situation. This includes any changes to your income which may occur throughout the process. Bankruptcy is a federal procedure, adjudicated by real judges, and scrutinized by representatives who coordinate with the Department of Justice, the FBI, and the IRS.

Here are some additional steps you can take to make the bankruptcy process as painless as possible:

 • Save all paperwork regarding your bankruptcy, and keep it organized. This will prove beneficial after your bankruptcy as you now have all of the pertinent information in one place. Also, be sure to write down your discharge date. It’s surprising how many people forget to do this.

• Establish a household budget. This can be accomplished in many ways, but there are several inexpensive computer programs available which do an excellent job.

• Throughout the bankruptcy, do your best to not only live below your means, but to save as much cash as possible. You never know what you may need it for once the process is completed.

• Be prepared for a barrage of junk mail. There will be sharks on the loose who are hoping to capitalize on your need for credit.

Tips for Rebuilding Credit:

• If you must buy a car, focus on transportation as opposed to style. Buy an inexpensive, used car, and try to get a loan for it. It’s a good idea to figure out what your budget allows in terms of a dollar amount first. This means obtaining financing prior to looking for a car.

• Get a secured credit card. Secured credit cards allow for the cardholder to deposit a said amount of money into an account, thus establishing the spending limit of the card. Missed payments result in deductions from the account. Some of these cards will reward responsible borrowers by upping the limit without an additional deposit. Some will even convert the account into a traditional credit card. (Be wary of offers of “easy credit” or any card which asks you to call a 900 number. You will be charged for the call.)

• Meet with a credit repair specialist. Not only can they help you clean up the damage to your credit report, they can advise you on specific ways to rebuild the credit you lost as well.

While it does take time, there is definitely life (and credit) after bankruptcy. Some mortgage lenders will even lend to you within a year or so after a bankruptcy. If you’re in serious financial trouble, the trick is to get the help and advice you need from professionals you trust.

    Jan 21, 2010

Home Buying Tips - Credit Score

Financial success and the ability to achieve long-term financial goals, such as purchasing a home, often depend on a person’s credit score.

By maintaining a high credit score, you can secure better rates on mortgages and other loans from banks and credit unions. A low score can prevent access to loans with lower interest rates—so you pay more for the money you borrow. The higher your score and the more solid your credit history, the less you pay to borrow.

Managing and improving credit is an important first step in securing an affordable rate on a loan.

Credit scores—which can range from 300 to 850—may be impacted by:

• Payment history. Make all payments on time.
• Level of debt. Avoid “maxing out” credit cards or maintaining high balances.
• Length of credit history. Aim for a long history of responsible credit management.
• Type of credit. Make sure to use a mix of credit (such as credit cards, retail accounts, or home and car loans) appropriately.
• New credit or inquiries. While shopping for good rates won’t hurt a score, opening multiple credit accounts in a short timeframe can.

You also need someone you can trust to guide you through this process.  Michelle Garcia has been a loan originator since 1996.  She has helped many of her clients re-establish their credit score to put them in better positions to purchase a home or to refinance their current one.  Her clients are loyal and know Michelle will always point them in the right direction.

If you are unsure of your ability to purchase or refinance, please contact Michelle or send her a quick email.  She is always ready to help.