Heather, I am so sorry for all the bad luck that you and your family are having at this time. Have you checked into any of the Churches? Is there any way that you can work? That would help, if you had family that would help with the children , then you could get a job. It will all work out. I will keep you in my prayers.
You've gotten some really good suggestions so far. To add, if you have anything you can sell: have a garage sale, put stuff up for auction on ebay, anything else you can part with to bring in a little cash, that may help as well.
I posted this in the past week to another message. Maybe it will give you some ideas & insight.
It's hard to support a family on one income. Have you made a monthly budget? Are you figuring enough for groceries, health care, gas, clothing, etc. Collect all of your bills & receipts for one month. At the end of it, total up each category to see if it's what you've got budgeted. Eating out quickly adds up - even just going to Chick~fil~a and other cheap places. Does your husband make enough to meet the budget? If not, you might need to get some part-time work while the kids are in school or when you husband is home so you can avoid daycare costs. How much is he paying for benefits? Perhaps your part-time job will have better benefits. You might just consider picking up a temporary job for the holidays. I think Dillard's pays $10-12 an hour. And Macy's at Penn Square had signs up yesterday that they were hiring for the holidays. Or provide in-home daycare to other kids in your area (like someone else sugggested). You are going to HAVE to work to solve your problem unfortunately.
Okay moving on - You have several additional options. If you just need cash in general, you could do something like Payday loans, but expect to pay out the nose in interest. Even the government thinks you will get the shaft if you utilize a payday loan and has come up with some alternatives. Here is a link to a very good article published by the FTC:
http://www.ftc.gov/bcp/conline/pubs/alerts/pdayalrt.shtm
Also, if you have a car that's got equity in it, sell it to get the cash out of it and keep part of it to buy a $2k used Honda which will run forever. Normally, I would suggest trying to refinance your home if you have any equity in it. This is usually a good option because you will have a lot longer repay term which will keep your monthly payment low. If your credit is so bad that your lender won't approve you, you can look at using a mortgage broker. They are easier to finance through but expect to pay more and have higher fees, but still it is an option. Again, it depends on how much $ you need & for how long you need it. Depending on your answers, this could end up being more expensive than payday loan in the long run. if things are really bad, you might need to consider selling your house and find free (shelter type housing like someone else mentioned) or cheaper housing. Also, if either you or your hubby have a 401k, then you might be able to borrow against it. It's not the most ideal, but it's money. If you absolutely must, you can cash out a 401k - but you will get taxed out the rear.
Figure out how much money you need, and determine if this is a one time thing to get caught up, and then look at all of your options to see which one is going to be the least expensive. Look at savings accounts, a garage sale, putting unused items on Ebay to generate some cash.
Overall on paper, the best economical solution to benefit your family would be to get a job. This involves no loans, paperwork, high interest rates and most importantly you are EARNING instead of BORROWING - which is really the ultimate solution. You need to bring money IN (income) instead of paying it OUT in the form of interest, etc. which puts you further and further behind. Borrowing just delays the inevitable - you lack income to pay cash for what you need or didn't expect (like an illness, job loss, etc.) and bringing money in is the only way you can break the cycle.
I don't know where you live, but I read an article I think it was in Metro Family Magazine. There is a food pantry in Bethany (I think it's Angelfood) and you can get a box of food that feeds a family of 4 for a week for $25. I don't think it gets any cheaper than that unless it's Ramen noodles, etc.
I know it's not easy and I hope you find a solution that works well for your family. Good luck!
Heather,
I am not a financial counselor, but with the mortgage company I know they don't want to foreclose anymore than you do. They lose money. I would at least in that sector make sure you keep talking with them. Don't not call and think they will just forget or something. They have a loss mitigation department usually which will ask you to gather some of your financial info such as how much you spend on gas, car payments, utilities, etc. and then they will want you to write a hardship letter explaining what's going on. Usually, they will work with you. Same goes with utilities. They really just want a call. Now they may still call you about paying, but let everyone know that you are working with the billing departments to set-up a payment plan you can afford.
Be careful, as far as the home mortgage loss mitigation department is concerned, about telling them that what is going out is more than $400-$500 more than what is coming in. Be truthful, but I learned that sometimes saying you spend some huge amount on groceries or gas, say, which you think will make them more understanding backfires and they will say you aren't going to be able to pay what we need you to pay. Don't be too confused, just show them that you are serious about paying your loan back, and maybe they can spread it out over a longer period of time.
I also think, if I remember right, they don't get too serious about foreclosure until you are about 4-6 months behind, but just call them ahead of time.
Start maybe with calling the IRS and asking where you can go for financial counseling or assistance. (Beware of financial counselors that say they are with the government, but are really privately owned and will cost you.) If I remember right the government counselors are free and there are some programs that might be able to help out, too(HUD, maybe?).
Remember, you are not alone. There are many folks out there living in relative luxury, but are going to food pantries because they are unable to pay the bills or feed their families.
Not much, but I hope it helps or gives you some hope!
I don't know a whole lot about this, but maybe you could use your internet service to look up debt consolidation services, I would look into a not-for-profit place. I remember hearing about something on the radio. I hope I could be of some help...?? Good luck, and God Bless
Read this book as fast as humanly possible. Apply it. It works.
http://wallacewattles.wwwhubs.com/rich.htm
God Bless
Love,
Dianna
Do NOT take out bankruptcy over $12,000. You should be proud of yourself that you do not have credit card debt. Do you have a radio? 11am tomorrow tune into 710am. Like others have posted, listen to Dave Ramsey (http://www.daveramsey.com/ ). If I were you, I'd call in and tell him what's going on. You're going through a rough patch but things will get better. You're not too far down and you'll pull youself back up.
You may try to contact some churches in your area. I know a lot of them will help you pay a mortgage or rent payment and also some utilities. DHS may have a list of some churches or other agencies that could help. Also your mortgage company most likely will work with you if you explain your situation. Do not "hide" from your creditors, they are more likely to work with you if you are up front with them. No one likes to make those calls, but sometimes when you tell them what is going on they can help or know someone who can.
As for the debt counseling, I don't recommend it. I worked in debt collections for a while and I heard nothing but bad things about them and customers saying they lied to them. They will tell you that if you are getting their help that the collection companies cannot call you, but that is not true. Some choose not to, but from a legal standpoint they can. At the company I worked for it was our policy to continue calling the customer, mostly because the debt counseling company was always late (which means more interest and late fees for you) or would skip months. Most debt counseling places claim to be not for profit, but actually keep your first months payment and some even keep a portion of your other payment. They claim that they are not profiting from you but they have to pay their bills and employees so they are actually profiting but using your money for them non the less. They also claim to eliminate the interest which is not true. In some cases they can get the companies to reduce the interest but mostly on credit cards and other small loan companies the companies have to agree to it. The company I worked for would not agree to reduce it for any reason. They would work with you on payments but that was about all. One of the many reasons I no longer work there.
And for the lady telling you your husband is working 80 hours and week because you won't and insinuating that you are going to cause him a heart attack, that was uncalled for. She sounds bitter. Don't listen to her. For one thing if your husband is like mine, he would rather work 2 jobs, not because he doesn't want me to work, but mostly because he doesn't want to be the one to take care of the kids. He says it is harder than working. He only has 1 job but when I was going to go to work to help out he said "no way" he would get a second before he had to stay home and keep the kids all day.
Good luck, I hope all works out.
Heather!!!! First of all, In your first part of your story, you stated that you have "2 car payments". Then on down into the story you say you and your husband only have "one car"!!! Which is it??? Anyway, I just want to also say, you should figure out how to make some cash, "yourself" If your husband already works 2 jobs then you need to figure out how to bring in some money to help with the bills!!!!! Life is not peaches and cream, trust me. Sometimes as you well know right now, we go down a hard road in life but what does not break us, makes us stronger!!!!!!!!
Heather,
Have you tried the HUD and FHA Loans, supposedly Bush has made those easier for families to get since all the foreclosures that are going on. Call a broker or the bank where your loan is and ask. Also on the car some banks will allow you to add the payments to the end of the loan to avoid reposing the vehicle. All you have to do is call and ask them what they can do to help. They would rather have your money than the vehicle, house, etc. Hope this helps, good luck and God bless.
It sounds like a debt consolidation program would be the best way to go. My husband and I did this about 6 years ago, and it was the best thing for us. It will roll all of your debts into one payment (which will be lower than all the other combined). The interest will be much lower also. You can probably combine everything into this except your house payment. This will help you to get back on track, and then you can slowly work on paying that bill down. One thing for sure, make sure you keep in contact with your mortgage company, and your car loan company. If they know that you are struggling, but are at least trying to make regular payments, they will be more understanding, and not so quick to file a reposession.
Hope this helps,
Jeanette
Heather, I can totally sympathize! My husband and I are working our way out of a pile of debt, too. We were introduced to a man by the name of Dave Ramsey. He has a plan for not only for debt reduction, but also for wealth building. You can get on his website at www.daveramsey.com. You can download worksheets to help you write a budget and keep track of what your indebtedness is.
Good luck!
You need to stop and take a deep breath. Time-out to re-evaluate your expenses. Take a note pad and start writing. Setting up a budget is a process that must be kept to religiously. There is no room for frills if you are on a limited budget and you continue to be a stay at home mom/step mom. You might look into starting a home based job on the internet. Possible consideration for you would be to seek a job at a day care center that would allow you to bring your 2 yr. old to work with you. I gather the other children are in school. Otherwise, my advice is to either try to set up a manageable budget yourself or seek professional advice on the matter.
Heather, do you belong to a credit union? A lot of time credit unions that do mortgage lending can help a family out in hard times. I would call around to local credit unions, especially if you belong to one and tell them your story. I would do what ever you could to save your house. Stop paying your credit cards bills and just focus on your home and cars. I am in mortgage lending, I see this all of the time. You need to make your mortgage payment and forget about everything else. Luckily 12k in credit card debt is not that much just don't fall behind on your home. Your family needs someplace to live!
Heather, Keeping looking up because you can beat this. I agree with everyone that has mentioned making a budget. My husband has one set up for us that lists ALL of our monthly needs, mortgage, utilities, food, Dr., etc. He as were his paycheck goes down to the last penny.
As far as your electric bill goes, I will tell you what we do. With all utilities we use moderation. If you aren't in a room, the light should not be on. Same with a TV. Just think common sense with all of it. My husband has even gone to the extremes of checking the electric meter, etc. to monitor how much we are using so that we know when to cut back.
At home day care is a great opportunity to bring in money as well. I do that and love it and it has allowed me to work from home while my daughters are not in school.
I also agree that you should call your mortgage company and elctric company etc to see how they can work with you on your bills. Good Luck.
I'm sorry to hear about your debt situation. My husband and I are trying to get out of debt as well and have been following the Total Money Makeover by Dave Ramsey. You can go to daveramsey.com and learn all about him. You can email him questions and I know he will have sound advice for you.
Another piece of advice, get on your knees and pray! With God, ALL things are possible. He will see you through this. Good luck to you and your family!!
Hey Heather--
I work from home with a team and help other moms work from home to earn that extra income as well. If you are motivated and serious about making that money to pay off your debt we can help you. Visit our website and if you feel you are a good fit for our team, fill out the contact info. and I can call you and get you all of the details on what we do and see if you qualify to join our team. Hope this can help you out!
Drop me a line and we can talk.
I've facilitated a budgeting class, and we can brainstorm together.
Ten Ways to Supercharge Your Cash Flow
by Chris Pummer
Thursday, November 1, 2007provided byMarketWatch http://www.marketwatch.com/news/default.asp?siteid=yhoo&dist=yhooSnapshotLog
So your mortgage payment just ratcheted upward or an unforeseen event has shot the heart out of your finances. Don't succumb to money melancholy just yet.
In the grand scheme, you may have serious credit problems you need to reconcile with due haste. More immediately, what you have is what high-finance types call a cash-flow problem -- not enough income and reserves to cover your monthly expenses.
Before unloading your house on the cheap to avoid foreclosure or hitting your doctor up for a Prozac prescription, consider that many Americans have tens of thousands of dollars in assets and $1,000 or more in potential monthly income and savings they often don't realize are readily available to them.
More From MarketWatch.com http://marketwatch.com/ :
Five Moves to Keep Your Debt Under Control http://www.marketwatch.com/news/story/five-moves-keep-your-debt/story.aspx?guid=%7B555FE878%2D88D2%2D4235%2DBDDD%2D61AF96507DB0%7D
Banks Play a Lot of Tricks to Sweeten the Pot at Your Expense http://www.marketwatch.com/news/story/banks-play-tricks-sweeten-their/story.aspx?guid=%7BCD25E7F2%2DD677%2D4EDB%2DB9C4%2D8BA68A4FCEF2%7D
Selling a Shared House http://www.marketwatch.com/news/story/divorced-couple-disagrees-sale-options/story.aspx?guid=%7BAB13AD94%2D63DA%2D43E4%2D9065%2D08984C27A19B%7D
"There are many steps you can take to improve your cash flow," says David Yeske, past president of the Financial Planning Association and a principal with the San Francisco-based firm Yeske Buie. "You just need to take a hard look at your options."
What follows are 10 ways to raise significant sums to overcome a sudden shortfall. Some involve sacrificing your future financial security. Others require eating a bit of humble pie -- but at least you'll be able consume it in your own home's dining room.
The big scores
Many of us are sitting on ten of thousands of dollars in retirement and college savings that we can access with minimal or no tax consequences or early-withdrawal penalties. Past Congresses made these allowances to help middle-income Americans get through hard times. These are sound ways to tap your long-term savings:
Roth IRAs. Because these accounts are funded with after-tax dollars, all contributions can be withdrawn freely at any time. Contributions made by converting a traditional IRA to a Roth can be withdrawn if held in the account five or more years. Conversion contributions less than five years old will be subject to a modest 10% tax for early withdrawal. Avoid pulling out earnings because they're subject to both income tax and the 10% levy. That hit could approach 50% of the withdrawal, depending on your tax bracket and state and local income-tax rates.
529 College Savings Plans. You can withdraw funds you contributed with after-tax dollars to these accounts with potentially minimal tax consequences. The withdrawn money will be reported to the IRS on a proportional basis, as principal and earnings, depending on the account's performance. For instance, if your contributions produced a 25% return and you take out $10,000, then $8,000 will be tax-free and the $2,000 representing the gain will be taxable. At worst, you may owe up to $1,000 on that amount, so you reap $9,000 or more from your $10,000 withdrawal. If the account's earnings are much greater, this is a less attractive source to tap. You should not take out any contributions made by others such as relatives. And 529 accounts set up under the Uniform Gift to Minors Act are not accessible.
Halt contributions to 401(k) and 403(b) plans. Many people overlook the fact they can suspend contributions to these employer-sponsored retirement accounts with their very next paycheck, Yeske says. Get yourself to HR and cancel these set-asides for the future -- but restart them as soon as you can after your crisis has passed.
401(k) and 403(b) loans. Many employers allow general-purpose loans from these savings plans. Such loans typically must be repaid within five years. The upside is the interest you pay on the loan goes into your account, along with your replenished funds. Just be sure to deploy the money strategically to get through your cash crisis and not fritter it away.
If you're really strapped and must withdraw money from your 401(k), 403(b) or tax-deductible IRAs be prepared to face that severe tax bite of up to 50% come filing time. If you hold off until this Jan. 1, you at least won't have to square up with the IRS until April 2009.
If you don't see your financial situation improving in the coming year, this move is strongly ill-advised unless you put aside the taxman's due in a lock box.
Monthly boosts
If you're sure it's impossible to get your income and expenses in line, think again. Many people can add $1,000 or more to their monthly income with minimal sacrifice. And since that's after-tax money, it represents about $1,500 or more you can put toward your mortgage, since your higher interest cost is tax deductible.
- Adjust your payroll-tax withholding to account for an increased mortgage payment. If your payment jumps $600 a month due to an interest-rate hike, that's all deductible and will give you an additional $7,200 tax write-off for a full year. That's a roughly $1,800 to $3,000 annual tax break -- depending on your bracket and state and local income taxes -- which means you could safely reduce your withholding $150 to $250 a month and boost your take-home pay that amount.
Adjust your tax withholding to stop overpaying if you typically get a filing refund. The IRS reported in April that refunds issued this year averaged $2,394. So taxpayers on average give the feds an interest-free loan of $200 cash a month. Since our tax exposure changes from year to year, Brian Pon, a tax adviser with Berkeley, Calif.-based Financial Connections Group, recommends consulting your tax preparer to determine how to bring your withholding in line with your anticipated liability.
Take a second job and send teenagers out to work. It seems like an obvious move, but many people under severe money stress freeze up like a deer caught in headlights and get run down financially. With the U.S. unemployment rate still below 5%, part-time positions are plentiful in most all job markets. The pay may be modest, but the added income could prove invaluable to your financial survival.
Sell your late-model car and buy a reliable older one. If you have an auto loan costing $350 a month (or worse yet, two loans), you could apply the difference in the price you get for your car and the balance you owe to the purchase of an older vehicle, many of which now still look good and perform well with 100,000-plus miles. Not only will you eliminate the monthly payment (which could cover a $500 jump in your mortgage payment due to the tax deduction), you also could drop collision and comprehensive insurance required by auto lenders if you can bear that risk, saving perhaps $50 a month more. If you own your late-model car outright, bank the money you raise after buying an older one and draw off it to steer through your cash-flow squeeze.
Get rid of your cell phones, high-speed Internet access and cable or satellite TV service. There was a time not long ago when we lived without these pricey nonessentials, for which many Americans pay $250 a month or more. If you're locked into a cell-phone contract, don't renew if it's soon to expire. If not, bite the bullet and pay the early-termination penalties. As for an Internet connection, default to a $9.95 a month dial-up plan until your fortunes improve.
Increase your insurance deductibles. Many auto lenders allow borrowers to maintain collision and comp deductibles of up to $1,000. And many mortgage lenders permit deductibles of $3,000 to $5,000 on homeowners insurance. You assume greater out-of-pocket risk, but you could save $100 a month or more by raising your deductibles.
Of course, the most immediate boost to your cash flow will come from curtailing your spending. Due to our vast use of hastily grabbed credit and debit cards to make purchases these days, Yeske says, many of us don't realize how large a percentage of our spending is a matter of choice and not absolute need.
"Few human beings are mentally and emotionally wired for budgeting because it requires a high level of concentration to track expenses, dollar-by-dollar, on a daily basis," Yeske says. "But just keeping a sustained focus on your spending can do your cash flow a world of good."
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declare bankruptcy That will give you a new start in life.
Contact Grace Presbyterian Church and inquire about the Crown Financial classes. It may be helpful. My expereince was to contact the creditors and arrange a smaller payment. Most would rather receive something in place of nothing. But you must make those payments each month. Good luck! Also, Riverside Community Church has the Dream Center food pantry. Check it out as it cost $25 a month but is will worth it. We use it every month. God Bless. You would be a good Food Basket Family. Contact Christian Union Church to inquire to contact person.