3 Reasons Homeowner Counseling May Be Good Even After You’re a Homeowner

3 Reasons Homeowner Counseling May Be Good Even After You're a Homeowner

As a young prospective home buyer, you are always advised to seek the counsel of professionals. Experts like real estate agents, accountants, even architects, are all important during your search for a perfect home to start your new life and raise your family.

But there is one professional who is the most important as they help you decide on the right time to buy a house if you should or can buy a house, and what kind of house payment your income can handle, they are Homeowner counselors.

Homeowners are a great help when looking to make a home purchase, but unlike what most people think, they are also especially useful when you have purchased your home.

Here are three(3) ways Homeowner Counseling can be of assistance to a homeowner:

  • Counseling on FHA loans

If you are having financial difficulties and in need of a loan you will need an advisor on how to go about it. Homeowner counselors provide professional advice to persons having problems with making their mortgage payments, facing foreclosure, short sale, or nigh on bankruptcy.

You will be provided counsel on providing documents to prove eligibility for second chance plans like the  FHA’s “Back to Work” loan program. Your homeowner counsel will put you through the preparation process by assessing your debt levels, educating you on the mortgage insurance, and its process of application.

  • Counseling on Reverse Mortgage

This is an issue that is popular among the elderly section of the population. It has become increasingly popular among seniors who have equity in their homes and want to take advantage of it to supplement their normal income. This step though is tricky and certainly not appropriate for everyone, as there are addendums attached to these types of withdrawals.

The only reverse mortgage legally insured by the government is HECM, the Home Equity Conversion Mortgage, and it is only available to an FHA approved lender. Before applying for such programs as the HECM program, you need to meet with a Homeowner counselor who will help provide information about repayment terms and eligibility.

Your preferred homeowner counselor will also advise you on the implications financially of these types of mortgages. Homeowner counsel will also provide you with alternate options to reverse mortgage and determine if taking this route is the best decision for you and your finances.

  • Advisory services on Foreclosure

According to the statistics, the rate of foreclosure filings is getting lower but many people still face the possibility of losing their homes due to delinquent payments. Working with homeowners counsels will help solve chronic delinquency and increases the chance of avoiding foreclosure. They help to educate you on wiser ways to go about your mortgage payments and save money while doing it, and also put you through a program to improve your knowledge and maybe save your home.

Related: Can you Refinance a Mortgage on a COVID Forbearance Plan?

Homeowner counseling apart from helping people make the best decisions on house purchases also help people avoid homelessness. They assist you in getting loans and taking advantage of allowances and exceptions in the law for homeowners. So ensure to keep in touch with your homeowner when you have a home-related problem and if possible, before you have any issues. Call us today for great references on homeowner counseling in the Western Washington Area.



Advantage Legal Group
Bellevue Bankruptcy Attorney Bellevue Washington Lawyer

More Advice on Bankruptcy:

What Documents Do I Need to Start a Mortgage Forbearance?

What Documents Do I Need to Start a Mortgage Forbearance?

With the recent coronavirus that hit the world really hard, most people have been forced to face untold hardship. This isn’t something that was bargained for by anyone, it just happened and everyone needs to adjust to the changes in the economy. The pandemic has affected the economy so badly that most people are worried sick about where their next mortgage payment will come from. However, the good news is there is always a way out because you can talk to your lender to grant you a forbearance agreement. It is an option open to everyone who has to pay their monthly mortgage payment, this way you can avoid being penalized for late payment or the foreclosure of the mortgaged property.

What is a mortgage forbearance?

Mortgage forbearance is an agreement between you and the lender to either reduce your mortgage monthly payment or defer the payment completely for a period of time. This forbearance is mostly requested by homeowners who are financially trapped and are not able to keep up with their mortgage payment. However, forbearance does not mean you won’t pay your loan again, you will still pay the amount you were not able to pay at a later date. Due to this pandemic, lenders have given borrowers a long-term forbearance agreement so they can deal with their financial problems.

While you are trying to get a forbearance, there are some documents you will be needing to give to your lender before your forbearance can be granted.

Documents needed for a mortgage forbearance

The documents needed for a mortgage forbearance actually differ by the lenders, which means you need to find out from your lender what documents you need to tender so that your application will be granted.

Application letter: Although requirements vary, but you are most likely going to submit an application letter stating your request. This application can be either oral or written because some lenders would prefer you to call them or send an online application.

Recent mortgage statement: You will need to present your most recent mortgage statement to your lender as proof that you have been keeping up with your mortgage payments to date.

Estimated monthly expenses: An estimate of your monthly expenses will also be required by your lender before they can grant you audience and listen to your plea for a forbearance.

Explanation of your financial situation: Since a poor financial situation is a reason why you need a mortgage forbearance, you would be asked to explain how bad the situation is for you. If you are out of a job or ill or any other situation, you will need to explain to your lender and in most cases show them proof of how bad things are for you so you can be granted the mortgage forbearance.

The documents listed above are what you will need to apply for aa mortgage forbearance, however, it is advised that you start the process on time so you don’t have to miss out on any payment when your forbearance has not been approved. Things are a bit difficult in the world currently and it wouldn’t hurt if you can apply for a mortgage forbearance to ease the burden of paying a loan off you until you can find your feet again.


Advantage Legal Group
Bellevue Bankruptcy Attorney Bellevue Washington Lawyer

More Advice on Bankruptcy:

Is Too Much Technology Hurting our Relationships?

The technology is all around us and it’s no big secret that we should have some balance in this department in our lives. But, when it comes to the professional world versus the social world, is there a balance to oversharing, being formal, and general overuse of technology?

In the real estate industry technology is now king. We send things through email, files through text, and can practically do everything on our phones. But where is the balance between social interaction, technology, and real relationships? You want to show your clients that you are well versed in tech-savvy instruments and yet remain relational when needed.

I read this article today in Realtor magazine about this exact topic and while this is a lengthy article, I’d like to summarize some of the main points in the article and add my own spin on it. Author Melissa Tracey gave three offenses that many people do with technology both personally and in their business. Let’s break the three down and talk about a more appropriate way to use technology for good medicine evil.

Author Melissa Tracey gave three offenses that many people do with technology both personally and in their business. Let’s break the three down and talk about a more appropriate way to use technology for good medicine evil

#1. Oversharing.

I understand that on Facebook we sometimes post pictures of our dinner or maybe a cute family photo but when we go overboard with kitten videos, multiple vacation photos (that seem more like bragging then sharing) and post so many times a day that people just want to unfriend us (which they usually will just hide us), then we’ve crossed into the realm of oversharing. We are a “me” society. The term “Sophie” is now in the dictionary we’ve become so obsessed with ourselves that we have forgotten to look outward. We’ve shared so much about our own lives, we have almost forgotten that there are other people’s lives out there to be a part of.

Melissa makes several points to oversharing and how to limit all the talk about me, me, me.

First, don’t make every post about you. If everything you only talk about is you, your life, your emotions, and your drama, people will start to tune you out.

Seek a connection. Really reach out, comment, and talk to other people on their social media networks tagging them, and truly being interested. You’ll be surprised at how many relationships you can foster.

Think about how much value the post has before publishing. This is really information that I want out there forever? (This is something to do before being a neighbor created. Never post drunk).

#2. Melissa’s second offense is overuse.

Are you posting on twitter or social media outlets 10 to 30 times a day? That’s probably overload and more people will just hide or unfollow you then actually find what you are saying to be of value. Don’t just simply coast for the sake of throwing up a post. It’s okay not to be connected all the time. There is now a new word for this rush of anxiety and fear some people get when they realize they are disconnected. It’s called Nomophobia. And a recent study estimated that up to 67% of the population could have this fear. That’s crazy! We need to be able to unplug, step away, and look at the world in our immediate circle, not the global circle that is the Internet.


Here are some simple ways to avoid technology overuse.

Monitor your use. Is your phone the first thing you grab in the morning? If you wake up in the middle of the night do you check it? You may have a problem.

Turn off your phone if you are around other people. It shows that you are generally concerned for their attention and you will gain a lot of respect when people know you really care.

Pay attention to nonverbal messages. If you are always glued to your screen what messages that sending to other people? Nowadays, nobody watches a concert; they instead watch it through their phones while videotaping it. That’s probably a video they’ll never watch again.

#3. Melissa’s third offense is being overly informal.

There is a point to being responsive and on the ball, especially when it comes to customers, but you also don’t want to be so informal that you send blank emails, abbreviations in texts and use poor grammar. A study shows that 43% of people surveyed would be less inclined to tour the home if the online listing contains misspellings or improper grammar. This sends a signal to people the details are not important. Even if it’s only subconscious if the agent misses these small details, are they missing the bigger ones later. We all understand that people are human and typos happen, but if it happens too often and just becomes ridiculous, it simply a lack of caring.

The bottom line is to slow down, proofread, edit, and don’t be abrupt. Emotions can be misconstrued over text and email very easily. Ask yourself if the text is important here or a phone call be better? Try not to get too comfortable using technology because don’t forget, on the other end there, is an actual human being.


Unique and Strange Real Estate Terms

Unique and Strange Real Estate Terms

These real estate and property terms are used quite a bit but many people have no idea what they actually mean. If you’re considering investing in real estate, selling or buying your first property, here are some key terms you should know.

APR – this stands for the annual percentage rate but you may also see it as APRC, which stands for the annual percentage rate of change, and is the entire total cost of the loan including interest charges and other fees. This is important to know when comparing other mortgage rates and terms.

Conveyancing – this simply stands for the legal work involved in buying and selling real estate.

Disbursements – This is the act of paying out or dispersing money, typically to the seller, real estate agents and other parties involved in a real estate transaction.

Gazumping – This odd term stands for when a seller accepts a higher price than what was previously agreed upon with another buyer. Another technical term would be to “swindle” somewhat and it’s usually the seller raising the contracted price of the property after having accepted a lower offer from another buyer.

Ombudsman – Again, if any term that stands for an official or person appointed to investigate individuals complaints on behalf of customers against real estate agents, escrow companies, and insurance companies.

Vendor – This is typically used as the legal name to describe the seller of the property or the real estate.

Freehold – a freehold is ownership of the property and/or land.

Real estate agents often shorten their descriptions of a property in order to get as many characters in the description area as possible. Too many homebuyers, they may simply look like letters that mean nothing to them in actuality. Here are some of the most common abbreviations you’re going to find in a real estate description.

1. BICC – Built in China Cabinets

2. Detached GH – Detached Guest House

3. FR. DRS – French Doors

4. FROG – Family Room Over Garage

5. FP – Fireplace

6. HDW – Hardwood Floors

7. Bb – Baseboard heat

8. CH/BW – Chain Link or barbed wire fence

9. d/w – Dishwasher

10. EIK – Eat-In Kitchen

Bedrooms and Bathrooms are also usually abbreviated like Bd and Ba and Living Room is sometimes shortened to LR or FM (Family Room). [Source]

Trying to keep all these terms in mind when searching through listings can be daunting but that’s what I’m here for! For mortgage modification or mediation, bankruptcy attorneys or information on the Washington State Fairness Act, contact me anytime.


How to Buy a Foreclosure

What to Expect in a Bank-Owned Home

If you sell, be prepared for the home inspection

Bankruptcy or Foreclosure Looming?

Bankruptcy or Foreclosure Looming?

Bankruptcy or Foreclosure Looming?

Let The Washington Foreclosure Fairness Act Help you!

New Mortgage Foreclosure Program for the State of Washington.

A little known Mortgage foreclosure program went into effect in Washington State in 2011.  It is called the Washington foreclosure fairness act (FFA).  This program is for you if you need help paying your mortgage and need to renegotiate with your lender!  This program was designed to help homeowners facing foreclosure and lenders to reach a resolution about foreclosures.

The Washington foreclosure fairness act also helps homeowners in that it requires lenders to notify “borrowers” before the foreclosure process of the possibilities of counseling and mediation.

You need a referral by a Housing Counselor or an Attorney to use the Washington foreclosure fairness act program!  The reason for this is so that you will have representation when you sit down with the lender’s attorneys.  When you are referred to the program, you will then be in the Mediation process.  This process can be a very timely solution for you and your lender’s problems with the right people to support you.  Having a knowledgeable law firm like Advantage Legal Group on your side can help you find your best option in a timely matter.

Related: 4 Ways to Raise Your Credit Score in 6 Months

Stopping the foreclosure process.

Once you are in the mediation process for the Washington foreclosure fairness act program the foreclosure process halts!  You must act in “good faith” to stay in the mediation process.  You and your legal representative will go through the mediation with your lender and their legal representative.  The mediator will aid both sides to come up with a plan that will benefit both parties.

Remember, that if at any time the mediator believes you are not acting in “good faith,” your mediation can be canceled and your lender can proceed with a foreclosure.  Your legal counsel will help you to know what you need to do.  Examples of not acting in good faith: not turning in the appropriate paperwork on time, not paying the mediation fee on time, and not responding to e-mails or calls from the mediator.

Other Important Information

Free Seminars, Free Consultations, and Informative Videos!

If you have been thinking about bankruptcy or you are seeing a foreclosure in your future check out Advantage Legal Group to help with your legal options.  Advantage Legal Group offers free seminars in the Seattle/ Puget Sound area.  These free seminars cover legal options all the way from Foreclosure Defense Strategies, Mortgage Mediation, Deed in lieu of Foreclosure, Mortgage Modification, Short Sales, to the Washington State Foreclosure Fairness Act.  Attend these free seminars in Bellevue, Lynnwood, or Tacoma.  Attendees also learn about their legal options for their specific financial situation.  You are under no obligation to do anything by attending the seminar.  After the seminar, if you choose, you can schedule a free consultation with Seattle Bankruptcy Attorney Jonathan Smith to discuss even more specific their financial situations.

Contact Us Immediately


Should I Use My Stimulus Check for Bills?

Should I Use My Stimulus Check for Bills?

Like millions of Americans, most of us will be getting some sort of a stimulus check in the next couple of weeks. When we hear the word stimulus we understand that it is to stimulate the economy but that doesn’t mean going out and buying the latest television or blowing it on something nonessential. Stimulating the economy means keeping up with your bills, mortgage payments, and rental payments. Remember, someone is suffering from not getting the funds they need and you might think that utility companies and big mortgage companies are faceless entities, but eventually, someone will need to get paid. I ran across this post on Facebook I thought it was very poignant to bring up here.

1. To Tenants: If the government says you don’t have to pay your rent and there’s a ban on evictions, you better do whatever you can to pay your rent. There will be major repercussions when eviction bans are lifted. Don’t think you’ll get a free ride out of this.
PAY YOUR RENT! Your landlord has bills to pay too.

2. To Homeowners: If the government tells banks to stop mortgage payments, DO WHATEVER YOU CAN TO PAY YOUR MORTGAGE!. Some lenders are saying you don’t have to pay for 3 months, but on the 4th month, all four payments are due in full. Do not take a chance and not pay. Major foreclosures will come from all this. The banks didn’t help homeowners in 2008-2009 and in 2020, it’s still the same.
Pay your mortgage.

3. If the utility company suspends payments, you better pay any amount you can! They are like banks, they will want their money eventually and when all this clears up, you’ll owe an exuberant bill and still won’t have any utilities. Pay whatever you can.

4. If you get a government stimulus check, this check is to help pay your bills. That means you pay your rent, your mortgage, your utilities, your insurance, your car payment, your bills.
This is not for frivolous spending.

5. The real problem is, many who will get the stimulus check….won’t pay their bills then will be crying and wailing saying
“They evicted me. They cut off my power, they repossessed my car…”
All while you’re broke and carrying that empty purse you bought with your stimulus check.

There’s always FREE cheese ? in a mouse ? trap!

It’s important to understand your rights, your financial situation, and the reality of the future. If you feel that you cannot make your mortgage payment it’s time to contact them immediately. You need housing first and foremost and then food. Pay your mortgage or your rent first and then food. Credit cards are frivolous spending but you do need heat, electricity, and power. These are things that you want to stay on top of. If you feel you need a real estate attorney, mortgage modification or mediation, or foreclosure is in the not so distant future, contact us immediately.

If you are at risk of losing your home due to foreclosure, mortgage mediation and modification might be your best solution. Contact us anytime to learn more information about Western Washington mortgage mediation, the fairness act, and how to avoid foreclosure.


20 Tips for Getting a Job During a Pandemic

20 Tips for Getting a Job During a Pandemic

This coronavirus health crisis has seemed to rock the job market overnight. Businesses are laying off workers, folks are worried about paying their mortgage and their bills, and about six and half million people have filed for unemployment. So what is this mean for folks that may have already started looking for jobs?

Those already on the hunt may want to put their job search on hold but others may have no choice. There are ways to look for jobs and tips to getting the right job during a pandemic. According to MSN Money, here are 20 tips for getting a job during the coronavirus pandemic.

#1. Review your online resume and profiles.

Double-check that all of your online resumes and profiles are up-to-date and that they all match. You want to ensure consistent messaging across the board.

#2. Update that LinkedIn profile with your accomplishments.

Get as many endorsements as possible and make sure that your linked in profile has the presence that you want spotlighting all of your achievements and accomplishments.

#3. Create a master resume and then trim when necessary.

Not every job application needs to have everything on it so have one master resume with everything and then scale it down when necessary depending on what the job is looking for.

#4. Update your resume and cover letter to reflect the current state.

It’s okay to pay attention to industry trends and update and adapt your cover letter based on things that are currently happening as well is the job that you are applying for. Are you able to adapt to the current state and quickly learn new ways of doing the job?

#5. Emphasize remote work skills.

Can you do your job completely remotely? Consider adapting the resume to highlight any previous remote work experience if possible.

#6. Consider a video resume.

A video resume can make you stand out from the competition and it should be less than a minute featuring you looking happy, professional, and talking about points in your resume that directly affect the job you are applying for.

#7. Consider an online course.

Simply by taking and completing some online courses it can give you the edge over the competition. Sharpen your skills or re-skill for a career change.

#8. Research the jobs that are in high demand.

You have to get strategic during this time. There’s a huge demand for delivery and healthcare workers as well as grocery store attendance and warehouse attendance. They may not be your ultimate dream job, but they are in high demand right now and you’re likely to get a job sooner rather than later.

#9. Stick to applications on companies that are actually hiring.

It may be difficult to get your dream job right now but stick to applications on companies that are actually hiring.

#10. Apply to 10 jobs every day.

Set aside time to apply to at least 10 jobs per day.

#11. Apply directly to a company website.

Off-site companies that post your resume such as LinkedIn, Indeed, Zip Recruiter, and Monster may be inundated with so many resumes that it’s a blur to potential employers. If you can go directly to the website, do it.

#12. Be flexible and open-minded.

If you’re serious about getting a job you need to keep an open mind about the opportunities you might find. You may not find a chance of a lifetime or you might… Your open mind can make the difference. You never know where an interest job may lead in the future, and maybe a more immediate future at that.

#13. Create a pitch deck.

Don’t focus on the past but focus on creating value immediately. This quick 3 to 4 slide presentation can outline what you may be able to accomplish in the first 30 days. This will really set yourself apart if you accompany it with your resume.

#14. Always be networking.

Even though you can’t meet with people face-to-face it doesn’t mean that you should stop actively networking. Set up 15 minute calls, Skype or Zoom at meetings, message people on LinkedIn, and build relationships. Someone is always hiring.

#15. Engage with potential companies on social media.

If you know what kind of job you want, zero in on the company’s leaders on social media without being annoying. You want to establish a good rapport by following them on LinkedIn, Facebook, and other social media to become a member of their inner circle and social media tribe.

#16. Practice your video interview.

Most interviews will be done over the phone or over video so you might need to practice before that phone call comes in.

#17. Don’t lead with the reason you’ve been laid off.

Try not to focus on negative circumstances surrounding your last job. Employers obviously know you’re looking for a job and whether that means you’ve been fired, laid off, you’ve quit, or you currently have a job, may not be as important as why they need to hire you now.

#18. Don’t get greedy.

Many companies are on a tight budget right now so it’s important to be realistic. If you are aggressively negotiating or using the crisis for financial gain, employers will quickly shoot you down. You want to address your compensation needs, not wants early in the process.

#19. There may be a delay in correspondence… And that’s okay.

Companies may not get to you right away because of the current hiring climate but it doesn’t mean that you shouldn’t actively keep applying for jobs. As I mentioned before, apply to about 10 jobs a day and keep them organized in a spreadsheet so you know who you’ve applied to, when, and if there’s any correspondence in return.

#20. Be patient and stay positive.

There may be setbacks and disappointment because these uncertain times can leave a lot of things up in the air but have some grace, go easy on yourself, and take this opportunity to learn and grow to the process.

If you are at risk of losing your home due to foreclosure, mortgage mediation and modification might be your best solution. Contact us anytime to learn more information about Western Washington mortgage mediation, the fairness act, and how to avoid foreclosure.

Homeowner Relief from COVID-19

Homeowner Relief from COVID-19

While some of us still might be getting a paycheck others of us may not and with your mortgage payment looming that can be extremely stressful. With the outbreak of coronavirus, homeowners may find themselves in challenging situations unable to make their mortgage payments. 7 out of 10 Americans live paycheck to paycheck and have less than $1000 in the bank. This can bring on stressful times for those of us that still need to make our mortgage payment. So what kind of homeowner relief from COVID-19 is available?

According to Fannie Mae, if Fannie Mae owns your loan, their Disaster Response Network can help navigate the mortgage relief process and offer other solutions to financial challenges. If you need mortgage help, Fannie Mae is available.

If the coronavirus has caused you to lose your job or income there are options. Homeowners may be eligible for forbearance plans to reduce or suspend their mortgage payments for up to 12 months.

Homeowners will not incur late fees during this time.

The credit bureau reporting of past-due payments of borrowers that are currently in a forbearance plan is suspended as well.

After the forbearance, a servicer must work with the borrower/homeowner on a permanent workout option to help maintain or reduce monthly payment amounts as necessary. This might include a loan modification.

Foreclosure sales and evictions of borrowers are suspended for 60 days.

While we don’t think that this outbreak and quarantine will last for 12 months, it is important to act quickly. If you have a Fannie Mae loan and are unable to make your mortgage payments, you can contact their Disaster Response Network for assistance. Their HUD-approved housing counselor can assist you in your needs and come up with a personalized action plan.

If your mortgages to Freddie Mac, similar forbearance assistance may also be available.


Because new mortgage rules with the coronavirus can change daily, it’s crucial that homeowners communicate with their lender about the latest options available to them. What might not have been available last week could be available today. The important thing is to keep you in your home, prevent or avoid foreclosure, and develop a plan for the next year ahead.

For more information on loan modification, questions on bankruptcy, and mortgage mediation, contact our office at any time.

Fear losing your home? Foreclosure looming?

Fear losing your home? Foreclosure looming?

You held out for this long but your lender has finally sent you the” letter.”  However, the letter talks about consumer debt counseling and mediation.  This is part of the Washington Foreclosure fairness act.  Lenders must inform you of your rights before a Foreclosure can be processed.  Bankruptcy is a valuable option to consider.  Understanding and knowing your options will help you to come out ahead.

Bankruptcies are on the decline?  You might think so as the economy recovers but bankruptcies are actually on the rise in many areas.  If you have recently been sent a letter from your bank or lending institution, it is time to contact an Attorney or consumer debt counselor that is recognized by the court system.

Whether you have been laid off, had medical issues with bills piling up, or just got in over your head with consumer debt, you are not alone.  Now you are afraid you are going to lose your home.  There are ways to help save your home.  Check out the New Washington program to help people just like you.  It is called the Washington foreclosure fairness act.  This act helps homeowners just like you to help are you negotiate with your lender.  It requires a wonder to notify you of the process before the foreclosure process starts.  The process includes consumer debt counseling and mediation with the lender.  You will need to have an Attorney or a debt counselor on your side to go into the mediation process.  Advantage legal group out of Bellevue can help you find your best option, walk you through the process, and hold your hand through the process.

It will become much clearer through the Washington foreclosure fairness act and with the aid of an attorney to be knowledgeable about your rights and responsibilities, and how to save your home.  First being in the mediation process actually stops the foreclosure.

Advantage Legal Group offers free seminars in Seattle and around the Puget Sound area.  These free seminars cover many options for distressed homeowners.  Knowing what options are available to you and what makes sense for your family will give you the confidence to go through the foreclosure process, mortgage mediation process, or short sales process.  These are only a few of the strategies that the seminar covers.  Understanding your financial situation and the types of strategies that are out there for you will help you to figure out your defense.  Is mortgage modification the option for you?  What is your best option, deed in lieu of foreclosure, mortgage modification, short sales, mortgage mediation, and what will your Foreclosure defense strategy be.

If after the seminar, you need more information Jonathan Smith a Seattle Bankruptcy  Attorney will schedule a free consultation with you to go over even more specific situations.

Additional Financial Resources:


Preventing Bankruptcies

Preventing Bankruptcies

We are in some unusual and unprecedented times right now but that doesn’t’ mean you can’t prepare and still have some time to plan.

People use the phrase “Practice good money management.”  However, what does this really mean?  Terms like impulse spending, realistic budgeting, and no high-risk investment are not part of the “good practice.”  Understanding what is good money management practices can help you in preventing bankruptcies.  Bankruptcy might be your only option but there are ways to prevent it.

How do you avoid impulse spending? 

  • Impulse spending is spending money on anything that is not a NEED.  Steps you can take to avoid impulse spending:
  • Cut up credit cards so you cannot use your credit.
  • Take your credit cards out of your wallet so you have time to think about a purchase you are going to make.
  • Ask yourself do I need this item or just want it.
  • Can I get this item somewhere else for less money?  Is an item available on Craigslist, E-bay, or a thrift store?
  • Discipline yourself to use credit only when you know you have money in the bank to pay off the total at the end of the month.
  • Tear up credit card offers.
  • Tear up credit card checks that your credit company sends in the mail.
  • If you have to use credit cards and you are not in a position to pay the total off at the end of the month pay more than the minimums.  If you can pay more than you put on the card that month.
    • Say you have$ 5000 in debt on a credit card and you bought $500 in stuff this month.  Pay $500 plus more when the bill comes.  This way you didn’t add anything to the card and if you did pay more then you are on your way to reducing the outstanding debt on the card.

What is Realistic Budgeting?

  • Write down what you pay each month for bills:  House payments, electricity, garbage, water, natural gas, home insurance, life insurance, medical insurance, car payment, cable, phone, internet, and whatever else is a reoccurring monthly expense.
    • Some expenses are every other month like garbage and natural gas.  Set aside an amount so that the total bill can be paid when it is due.  (If your natural gas bill is around 200 every other month set aside 100 on the month it is not due that will be used in the next month)
  • Budget for food, entertainment, gas, and misc. expenses
    • Know what your average spending is for food, entertainment, gas, and misc expenses.
    • Create a set amount (budget) for each category and stick to it.
      • This might take some collecting of receipts or writing down each purchase.
      • Some people have taken out money from their paycheck, put it in an envelope, and that is the money for food for the month.
      • Whatever will work for you, to stick to a set amount, and do it!

What are high- risk investments and how can I avoid them?     

  • Don’t incur debt with others who have questionable financial habits.
    • If they walk out on a debt your credit rating will be effected
    • Co-signing on loan is a high-risk investment – it might be helping a family or friend out but if anything happens to them, you are left holding the loan!
    • Interest-only loan payments are high-risk investments.  If you can only afford to make an interest-only home payment, then the house is out of your price range.

You may be looking at how to get out of debt and bankruptcy seems like the only way just remember these ideas so you will not have to file for bankruptcy again.  Contact advantagelegalgroup.com for more help.

Schedule a Consultation


Additional Financial Resources: