Make a New Year’s resolution to rid stress from your life…

It’s simple, get your finances in order--you won’t believe how good it feels to be money smart.

Tips for making the list:

BE POSITIVE.

Sometimes this is easier said than done. To keep in the mindset, try wording your goals positively, such as “we’re going to spend money only on things we truly value.” If you stray from your goals, don’t beat yourself up or dwell on your mistakes. It will only serve to make you feel worse and keep off track. Just jump right back on that horse and promise yourself to stay on the path.

Keep your resolutions attainable.

Check in with your goals at least once a month. Set a reminder for yourself. For instance, decide that every time you make a payment on that credit card bill, you’ll revisit your financial resolutions; this will help you track how far you’ve come. Remember that if you’ve made it this far, you can reach your goal!

Be specific.

Make instructions for yourself for just how exactly you plan to attain your goals. Instead of saying you will save more, write a budget up. This will help keep you on point.

Make a contract with yourself.

With your resolutions set, document all your goals. You could even include reasons for committing to them. At www.FutureMe.org, email this to your future self a month, two months, six or 12 months in advance, or print out the letter and place it on the fridge, so you can be reminded of why these goals are important, especially when other crises seem to get in the way.

What our in-house experts recommend you put on the list:

Review your insurance.

Your policies may be outdated and not suited for your current needs. Review what you have: homeowners, life, even auto may be insufficient relative to your present financial situation.

Check your credit score.

Be aware of where your credit stands and take steps to repair any negative aspects. You get three free credit reports each year, there is no excuse for not reviewing what is one of your most important financial reports, especially since errors in these reports are not uncommon. www.annualcreditreport.com

Invest what you can.

Even if it’s just a little, invest in yourself and family. It could be as simple as paying yourself first by contributing to your savings each month, or it could be a retirement fund, an education fund, or making extra mortgage payments. Consider these things as investing in yourself and your future.

Taking care of these will allow you to enjoy a happier, more prosperous and stress-free new year.

Written by: Sarah Cornwall, Marketing Resources, at Family Services, Inc.

Don’t stress! There are still deals to take advantage of, even after Black Friday!

Budgeting isn't easy, but it’s a GREAT feeling knowing you have a healthy bank account. Let us help make holiday budgeting and purchasing easier—attend December’s Credit Club! In the meantime, here are some suggestions from our budgeting professionals.

Have a plan

Avoid holiday headache overspending and make a detailed budget plan. Encompass all that is part of the holiday season into the budget, including travel, food, events and parties. There should be a long list of what your holiday expenses are. While planning and spending, think of ways where you can cut back on your budget or save on expenses.

Comparison shop all your planned purchases

Check ads in newspapers and visit retailers’ social media pages or websites. Saving just a few dollars on each expense adds up! If getting the better deal means driving to several different shops, save gas money by grabbing everything while you are already out or try carpooling with a friend.

In the true spirit of the season, the thought really is what counts

It’s tempting to use shopping as a way to get into the holiday spirit. Instead of making time for shopping, make time for friends and family, and creating gifts that are personal. If holiday expenses really have you worried, talk about it with friends and family; they might be just as eager to set limits on gift spending.

Food for thought for the New Year

Employ multiple saving strategies in addition to savings accounts, such as the whole family pooling and saving change over the year. Every little bit only serves to help, and you might be surprised just how much you can actually save in a year while still making ends meet.

If you do especially well this holiday season and spend under your budget, consider getting a head start on Christmas for the following year. After-Christmas sales are competitive with Black Friday deals; cards, decorations, and Christmas-themed gifts will be hugely discounted.

Don’t miss out on a workshop that is sure to help make your holiday full of cheer! This month’s Credit Club “Creating Memorable Christmas Traditions” on Thursday, Dec. 5 at 6 p.m. will help you create those wonderful Christmas memories for you and your family that will last a lifetime! Click here to learn more and register.


Written by: Sarah Cornwall, Marketing Resources, at Family Services, Inc.

Bargains for a Happy Halloween

Halloween is expensive and although it is over, the immediate week after is perfect for taking advantage of steep discounts. Decorations and all other overpriced Halloween accessories are priced for cheap; which usually reflects the quality of Halloween-themed products.

Think about stocking up for the following year. With decorations and costumes already purchased you will have more time and money next Halloween for carving pumpkins and enjoying hayrides.

If you miss the window for after-Halloween sales, there are plenty of other ways to save big. Purchase candy after other big holidays such as Easter or Valentine’s Day. Make the decorations yourself—this pairs as a great Halloween activity for kids.

Shop online to price compare and be sure to check reviews. Many reviews will not be great, but if it’s a cheap price, then you’re getting the expected value.

Avoid those Halloween-themed retailers that appear every October. Their items are almost always over-priced.

There are many ways to save money on costumes, which, once purchased for the whole family, can add up to a hefty price. Try to reuse or repurpose costumes from previous years. Swap costumes with friends or relatives. More and more funny costumes tend to be the simple but clever ones.

For more ideas, check out this list of easy, cheap, and humorous costumes: http://www.essortment.com/halloween-costume-ideas-50-funny-ideas-52248.html

Trick or treat!

Written by: Sarah Cornwall, Marketing Resources, at Family Services, Inc.

How to Save Big on Healthcare

You have probably heard that big changes are coming to healthcare this month, but you might not be sure how it affects you. Here's what you need to know to save big on healthcare this year.

The Affordable Care Act caused state healthcare exchanges to open on October 1. A healthcare exchange is a kind of marketplace where insurance companies offer different plans to consumers.

However, just because these plans are available to you does not mean that you should automatically drop your employer's insurance. This is because, under your company's insurance, your employer is actually paying for some of your coverage. 

On the other hand, there are specific circumstances that may make shopping the healthcare exchange worth your while. If you fall into one or more of the categories listed below, you should consider shopping the exchange for a better deal on your healthcare coverage:

• More than 9.5% of your household income goes to health insurance. Even if you have your company's healthcare insurance, you may be paying a significant portion of the cost. If so, you can drop your company plan and find assistance in the state healthcare exchange. 

• Your employer pays for less than 60% of your healthcare costs. This is another indicator the government uses to identify inadequate coverage. It usually applies to high-deductible plans. 

• You work for a company with less than 100 employees. The Affordable Care Act only requires companies with more than 100 employees to provide health insurance. If  your employer offers no or minimal coverage, you might be able to find a better plan at the exchange. 

• You earn less than 400% of the poverty level. If you qualify for a government subsidy, shopping the healthcare exchange is a good idea. To qualify for a subsidy, you must earn between 133 and 400% of the poverty level. If you fall below the 133% mark, you qualify for Medicaid. If your income is above the cutoff point, you can still use the exchange to shop for health insurance. However, you will not receive a tax break. 

Whether or not you are enrolling in the healthcare exchange, there are other ways that you can save on your medical expenses. One way is to have a healthcare savings account. It could save you money on taxes as well as provide free money for medical bills. Here are THREE types of healthcare savings accounts to consider:

• FSA - A Flexible Savings Account is set up through your employer and puts pretax dollars aside for medical expenses. FSAs are especially helpful for expenses that you know are coming, such as paying for children's braces. In order to be reimbursed, you must turn in your receipts. When using a FSA, it is important to budget carefully since the money must be spent within the calendar year or it returns to the company. 

• HSA - The money in a Health Savings Account can be invested, so it could earn more for you than if it was just sitting in savings account. The earnings are rolled over every year, and you can withdraw all of it when you turn 65. These accounts are available through employers and banks, and many of them come with fees. To sign up, you have to a high-deductible insurance policy.You must also be careful not to use the funds for a non-qualified medical expense before you turn 65. If you do, the IRS will add an extra 20% to your federal taxes. 

• HRA - The only type of account that employers completely fund is a Healthcare Reimbursement Account. The money in this account will stay there from year to year, and it covers nearly everything that a FSA or HSA would. While some require you to file a claim, others simply give you a check card to use for your health expenses. However, you do not keep the money once you leave that job, so keep that in mind if you are preparing to retire or change careers. 

With these tips in mind, you should be well prepared for the coming healthcare changes. If you have any other ideas on how to save money on medical expenses, please share them in the comments below!

Written by: Meg Thompson, Marketing Resources, at Family Services, Inc.

Quick tips to get you on the path to homeownership

Owning a home is a great way to build an investment and see return on all the “rent” you’re already paying month to month. Right now, interest rates are STILL at an all-time low. If you’re mortgage ready, take advantage of this and get yourself a good deal!

1.   Look at your budget and determine how a house fits into it. Fannie Mae recommends that buyers spend no more than 28 percent of their income on housing costs. If you pay more than 30 percent of your gross monthly income to put a roof over your head, you are living ABOVE your means. The term “HOUSE POOR” will have real meaning.

Keep in mind: Owning a home is not like renting – you are the landlord. When it breaks, you fix it. EXPECT unexpected costs. When new appliances, roof repairs and plumbing problems pop up; these costs can drain your bank account.

2.   Go to a bank or lender to get pre-qualified. This initial step allows you to assess any goals or needs you may have regarding your mortgage with your lender. From here, you can learn about your various mortgage options and the type that might be best suited to your situation.

Keep in mind: Being pre-qualified is NOT the same as pre-approved. It is strongly advised that those seeking homeownership do not house hunt until they are pre-approved, which is much more extensive.

3.   Find a realtor once you are pre-approved and set on what you can afford. Meet with a few agents, to find one you feel confident with. An agent who is a member of the National Association of Realtors is a good sign as they adhere to a strict ethics code.

Keep in mind:  A good real estate agent can help guard against any pitfalls you may encounter during the process, so choose wisely.

4.   Know and understand the various mortgage products available to you. Factor in closing costs you can afford. This will help you choose the best mortgage program for you. As a first time homebuyer, options may be available to you, such as low interest programs and down payment assistance.

Keep in mind: If you plan to move within five to 10 years, an adjustable-rate mortgage (AMR) could be beneficial. However, if plans change and you stay in your home for longer, you may be stuck with payments you can’t afford.

5.   Try to hold off on big purchases or any decisions that could affect your credit once you’ve signed a contract and a closing date is set. Typically, lenders pull credit right before closing to make sure nothing has changed with your financial situation.

Keep in mind: If you feel over-stressed, lost, or uncomfortable with the homebuying process or any part of it, don’t be afraid to ask for help. The Homeownership Resource Center, a division of Family Services, Inc., not only offers help and guidance, but piece of mind.

To learn more about the workshops and individual appointments we provide with our licensed homebuyer coaches, contact us at 843.735.7862 or info@fsisc.org.

Written by: Revena Dawson, Home Purchase/Credit Advisor, & Sarah Cornwall, Marketing Rescources, at Family Services, Inc.

4 ways to use your tax refund to strengthen your overall financial situation

If you are anything like me, you’ll be more than tempted to use your tax refund for that flat screen you’ve wanted, or maybe that weekend vacation you keep putting off. It feels good to finally get those material things you’ve “needed”. However, like most material indulgences, the charm wears thin and quick…especially when an emergency comes up, or reality hits that you should invest more in your future.

I asked our experts here at Family Services, Inc. for different ways to use a refund that will leave you feeling secure, and confident about your financial situation.

 1.       Pay off/down debt: This encompasses a lot. Who doesn’t have debt these days? Pay off a credit card balance. Double up on a mortgage payment. Doing this once a year can shorten your overall payment period (provided it's allowed under the terms of your loan). If you’re not a homeowner, apply this trick used for mortgages to your student loan debt. Paying down debt, whether it’s a credit card, car loan, mortgage, student loan, or any other kind, is usually a guaranteed return equal to the interest you would have otherwise paid.

2.       Make an emergency fund: If you have your debts under control, and don’t feel it’s necessary to make an extra payment, then your tax refund might be an excellent starting point for building an emergency fund. Personally, my refund will be put away as “emergency funds”. The other day I left work to find that I had a flat tire. Needless to say, I had NO money to pay for this unexpected expense and was forced to charge it, maxing out my credit card!

3.       Invest: If you have no debt and a healthy emergency fund (kudos to you), then you can always look to the future. A tax refund can be used to put a down payment on a house, buy a car, or help pay for an education for you, or the little ones (look to ESA plans and 529 plans). Try one of these: 401(k), 403(b), Roth IRA, Traditional IRA, SEPs. Have questions? One of our licensed financial coaches can help! The purpose and the time frame will help you decide the kind of investment you should be looking at.

              

4.       A savings account: Instead of a regular savings that would perhaps hold your emergency fund, try a Christmas club account. Christmas is the same time every year, but it still catches the majority of people off guard. Even better, invest in a Certificate of Deposit account, similar to a savings account but with higher interest for your benefit.

Go to www.fsisc.org or call 843-735-5522 for information or assistance.

Written by: Sarah Cornwall, Marketing Resources Assistant at Family Services, Inc.

Consumers Should Use Caution When Considering Some Forms of Borrowing or Purchasing

Interest and Fees Can Easily Outweigh the Benefits
The National Foundation for Credit Counseling

Desperate times often call for desperate measures, but sometimes those tactics can leave you worse off than where you began. This can be the case with people struggling to find money for holiday purchases.

Three areas to avoid when looking for extra money this holiday season:

Payday Loans - On the surface, getting the cash you need may seem worth it at any cost. But it’s that cost that can become financially back-breaking. To obtain a payday loan, you write a post-dated check for the amount of the loan plus any fees the lender tacks on. You then receive the amount of money you initially needed to borrow, promising to pay back that amount plus the fees. The term of the typical payday loan is one to two weeks, at which point the lender cashes your post-dated check. Most payday lenders will charge a certain dollar amount per $100 borrowed. For example, they may charge $15 for every $100 you borrow. Thus, if you needed $300 for two weeks until your next paycheck came in; your post-dated check would be for $345. What’s $45 when you desperately need $300? Here’s the catch…that $45 represents an Annual Percentage Rate of 390 percent. You wouldn’t dream of taking out any other type of loan with triple-digit interest. And, if this isn’t bad enough, many consumers cannot repay the loan at term, and end up rolling it over, thus adding on more fees and interest.

Pawn Shops – People can do several things at pawn shops. They can borrow money by putting up something of value as collateral, they can sell their merchandise outright, or they can buy the merchandise that is for sale at the shop. There are bargains at pawn shops, but only for those buying the merchandise, not for the sellers. Typically, the person pawning the merchandise receives a sum of money (usually nowhere near the true value of the item) which he or she agrees to repay with interest. If the loan is repaid by the end of the term, the merchandise is returned to the owner. If the loan is not repaid, the consumer can renew the loan, or the merchandise is forfeited. What’s the problem? Again, it’s the interest and fees, with APRs typically in the triple-digit range once everything is added in. Further, some studies show that only 60 percent of pawners end up reclaiming their merchandise, thus they have essentially sold an item for cents on the dollar, something they wouldn’t otherwise do.

Rent-to-Own – Everyone wants nice things, and if the family is coming over for the holidays, you may be tempted to spruce up your home. A quick trip to the furniture or electronics store could confirm that a new living room set or flat panel TV is out of your price range. Then you notice an ad for similar items with affordable monthly payments. It seems too good to be true, and it is. The problem once again lies in the interest and fees. For instance, if you bought a $200 item and agreed to make weekly payments of $15 for 78 weeks (basically one and one-half years), you’d end up paying $1,170 for that $200 item at an APR of 388 percent. Adding insult to injury, it is likely that you could have purchased the same item at a traditional store for a fraction of the overall cost.

For help managing household debt and/or living within your budget, contact Family Services, Inc.’s Consumer Credit Counseling division, 843.735.7802.

SHOULD YOU BE SHOPPING THIS HOLIDAY SEASON?

Holiday Spending Quiz Helps Consumers Evaluate Their Financial Situation

One in every 10 Americans is currently unemployed. Foreclosure filings were reported on close to one million properties in the third quarter of 2009. Personal savings, if it exists at all, is a fraction of what it should be. Terms on credit cards are rapidly changing, putting some consumers over the financial edge. And the biggest shopping day of the year, Black Friday, has just passed.

“Considering the volatility of the economy, consumers would be well-served to take a hard look at their personal financial situation and evaluate how to best approach the holiday season,” said Michaele Pena, Director of Consumer Credit Counseling Services (CCCS), a division of Family Services, Inc. “Self-inflicted financial pain that could have negative consequences for years to come is a gift to no one.”

Family Services, Inc. suggests that consumers take the following Holiday Spending Quiz to assess their current financial stability before they begin shopping: (answer true or false)

• There are arguments in my home about money.
• I sometimes hide my purchases.
• I have thought about filing for bankruptcy.
• I struggle to make my mortgage payment.
• I sometimes pay my bills late.
• I have used more than 30 percent of my available credit lines.
• My debt interferes with my sleep, job or home life.
• I have little or no savings.
• I am receiving collection calls or notices.
• If I lost my job, it would mean an immediate financial crisis in my life.

The harsh reality is that consumers who answer “True” to two or more of the above are not candidates for a holiday shopping spree. Ignoring the reality of your financial situation will almost certainly lead to further financial distress down the road. It will come in the form of an unmanageable debt load, resulting in a damaged credit report and lower credit score, likely limiting your access to future credit. If there were ever a year to approach holiday spending with your head instead of your heart, this is it.

“Family Services, Inc. supports financial responsibility, regardless of the season,” Pena continued. “With the ghosts of Christmas past still lingering on many credit cards, piling new debt on top of old cannot be considered responsible by any measure. With any sacrifice comes reward, and the benefits of not having a mailbox full of bills in January will likely outweigh any lifestyle spending adjustments consumers make during the holidays.”

If you’re wondering how to deal with holiday spending on a limited budget, reach out for help by contacting the Consumer Credit Counseling Services division of Family Services, Inc. Call 843-735-7802, or go online to www.fsisc.org.

7,914… AND COUNTING

by Debbie Kidd

It was with great interest that I read the Department of Treasury’s report on South Carolina and the Home Affordable Modification Plan (HAMP). While it is extremely gratifying to see the program gain some traction, I can’t help but think of the herculean efforts of the teams of default counselors who have been working to help homeowners for the past two years. Our counselors have really born the burdens of the many clients who have come through our doors. Many have shed tears with them, and others have offered their own time to help families move out if a foreclosure did occur.

I am honored to work with such a devoted team of professionals who got up to speed quickly, conquered the technical requirements and adapted to every requested change. It’s not easy facing sadness and despair each day, but our counselors do it with dedication and integrity.

As proud as I am of our team, it’s the families who are etched in my mind and heart. It is not easy to walk into a public building, meet with a stranger, and have to explain why the mortgage hasn’t been paid in months. Additionally, having personal and sensitive financial documents reviewed and analyzed – with a critical eye looking for excess – would test the mettle of anyone. Yet, every single day, more and more people come to our office for help. We constantly take calls from people who are desperate, scared, and often misinformed. In some cases they have been scammed by a promise of something that’s too good to be true. Fortunately, we have been able to help a few folks get their money back.

Next year, we are going to have an opportunity to help even more families. It has been estimated that as many as 5 million adjustable rate mortgages are going to reset, resulting in serious payment shock. As we prepare to endure longer days, and even sadder stories, I am going to celebrate the turn of circumstances for those 7,914 South Carolinians who are going to stay in their homes. If a modification happened for them, it can happen for many others as well. South Carolina is very fortunate to have a responsive foreclosure task force and the staff of The Homeownership Resource Center standing ready to do all we can to help.

If you are a homeowner having trouble making your mortgage payment, or you suspect that trouble is just ahead, call us today at 888-320-0350 or visit us on the web at www.fsisc.org.

For the Love of $.19

Written by: Toby Smith

I had an experience this week that really brought home the message we preach to all clients-new, returning, and prospective; CHECK YOUR CREDIT REPORTS ON A REGULAR BASIS!

One of my New Year’s resolutions was to check my credit report four times a year, instead of two, and during the January check up, I was not happy to see that a problem I thought had been resolved with a local utility company was still showing on my report. I made a mental note to check it again, and to take further action, if necessary. Well, the fall check up arrived, and the problem was still not resolved so I put on my battle gear and called the company.

A pleasant representative, who verified my identity, pulled up the account, and while I couldn’t swear to it, I thought I heard her laugh before she said, “The balance is $.19 cents.”

SAY WHAT???? This has to be a joke! Either a very good one, or a really bad one, but this can’t be!

“Yes, ma’am,” the representative continued, “You did pay the account, but the cents were left off, so technically it’s not paid in full. Let me transfer you down to the credit folks,” she added rather quickly.

Lots of negative thoughts played pinball in my head and the “hold” music, some Kenny G. wannabe, was not making the situation any better. Then, another voice of authority came on the line.

“How can I help you?”

She didn’t say it, but I heard it in her voice – get to the point, no crying, and don’t waste my time!

I humbly explained my sad tale, and advised her of what I learned minutes before. She listened patiently, before dropping the hammer.

“Well, the information you have received is correct. You have two choices, wait for the information to fall off your report, or come down and pay it. We report to the credit bureaus on the 15th and the 30th.”

I went into argument mode, explaining that I had paid the balance off last year; the status should have changed. By now, I’m slightly raising my voice and ask, “Are you telling me that the status didn’t change because of 19 lousy cents? Is that what you’re saying?”

She didn’t even flinch.

“Yes, that’s correct. The bureaus do not recognize the cents, but we do, and that’s why this remains open. You can come down and pay it. We report to the bureaus…[blah, blah, blah]…and here’s your account number for future reference…[blah, blah, blah]…and we close at 5 pm. Have a nice day."

Click.

No chance of that!

Unbelievable!

So, I left work at 3:30 pm, drove 20 minutes, parked, and went inside to pay my $.19 cents. (See, it does pay to keep pennies!)

Aside from a good laugh, I would be grateful if you would take away the following:

1. Check your credit report more than twice a year. Once a quarter isn’t a bad idea, especially, if you are in serious “clean up the credit” mode.

2. Checking your own report presents no problem. However, shopping for credit generates inquiries. There are two types; hard – car dealerships, banks, credit unions and; soft – credit card promo offers, etc. Both can drop your score from three to five points a pop.

3. With respect to status, paying “as agreed” is always the goal. “Current was” means that you fell behind but brought the entry current. “Collection” indicates that you have stopped paying and “Charge off” means that the creditor wrote the item off as a lost cause. But rest assured, it will find a home on your credit report. Seeing the word “paid” in front of collection or charge off indicates that the item was addressed, which is generally a good thing for your numbers. Be careful about paying any and everything, though; some old items can get you into trouble.

4. The folks you do business with either report your monthly affairs to the credit bureau or they don’t. Hopefully they do, and it’s very important that everything goes to all three bureaus, Experian, TransUnion, and Equifax.

5. You might want to pay things down to the penny….

6. If you don’t check your credit report regularly, be prepared for the unexpected, nasty, surprises to pop up. Family Services, Inc. offers a popular class called Credit Cents, which, among other things, teaches participants how to read a tri-merge report (the three credit bureaus) report and encourages the development of a written action plan. For more information on Credit Cents call 735-7862 or visit the website at www.fsisc.org and click on Credit Improvement under Homeownership Resources or Consumer Credit Counseling.

Just a word of warning…if you come to a Credit Cents class, expect to hear this story again. If we ever meet, expect to hear about the day I had to pay $.19. My great-grandchildren–who are nowhere in sight–are going to get a letter about the benefits of checking credit reports regularly.

The receipt reads:
Prior Balance: 0.19
Payment: 0.19
New Balance 0

For the love of $.19…. smile

First Time Homebuyers Could Qualify For $3,500 On Top Of $8,000 Federal Tax Credit

Qualified tri-county first time homebuyers could receive $3500 from the Homeownership Resource Center, a division of Family Services, Inc. In addition to the $8,000 Federal Tax Credit already available, that could mean up to $11,500 to first time homebuyers. The additional $3,500 will be given to one qualified person or family at each of the six upcoming First Time Homebuyers Workshops hosted by The Homeownership Resource Center. The Homeownership Resource Center is a non-profit, HUD-approved counseling agency.

The recipient of the $3,500 must attend the free First Time Homebuyers Workshop and close on their first home by November 30th, 2009. November 30th is also the date the current Federal Tax Credit will expire. Other restrictions also apply.

Traditionally, the Homeownership Resource Center loans money to qualified first time homebuyers for the initial cost of closing and their down payment. However, due to new federal banking regulations and an accumulation of funds for public distribution, The Homeownership Resource Center will be giving away this money to six qualified first time homebuyers, regardless of income. One first time homebuyer from each of the six upcoming workshops will be selected.

Available Workshops:
Saturday, September 12th from 10am-4pm
Saturday, September 19th from 10am-4pm
Saturday, September 26th from 10am-4pm
Saturday, October 3rd from 10am-4pm
Saturday, October 10th from 10am-4pm
Saturday, October 17th from 10am-4pm

Location: Trident One Stop, 1930 Hanahan Road, North Charleston, SC

The Homeownership Resource Center’s First Time Homebuyers Workshop was created to educate homebuyers about the homebuying process and what to expect when purchasing a new home. Through the workshop, HUD-certified counselors, with more than 20 years of extensive training and experience, work closely with the homebuyer through every step in an effort to simplify and reduce the stress of the buying process. As a result, the Homeownership Resource Center has helped hundreds of individuals and families achieve their dreams of homeownership.

Some of the many topics that will be discussed at The First Time Homebuyers Workshops include: Mortgage programs, buying HUD properties and foreclosures, home inspections, homeownership insurance, getting the most out of your real estate agents, legal fees, and current market conditions.

Please call 843-735-7862 for more information or visit www.fsisc.org.

IS A CREDIT CARD A MUST FOR COLLEGE STUDENTS?

Family Services, Inc. Offers Alternatives for Building a Credit History

Parents across the country are having the talk with their young adult as he or she heads out the door to college. This year, however, the talk isn’t about sex, drugs and rock and roll. Instead, it’s about whether or not the student should apply for a credit card before the new regulations go into effect in February 2010. The recently passed CARD Act will require a person less than 21 years of age to either document their ability to repay the debt, or have a co-signer before being granted credit.

The new law will also regulate aggressive credit card marketing to college students. In years past, issuers enticed students to apply for cards by making offers of free t-shirts, beach balls, or even chances for an iPod. Some states have already passed laws restricting or regulating credit card marketing on college campuses, and with good reason.

A recent Sallie Mae study revealed that college seniors carried an average credit card debt of $4,100 compared with $2,900 five years ago. College freshmen tripled the amount of debt on their credit cards, going from $373 to $939 over the same date range. Keep in mind that this segment of the population typically has no income and no credit history, but has nonetheless been extended credit.

“We live in a credit-dominated society, with most of us dependent upon credit for major purchases,” said Michaele Pena, Director of Consumer Credit Counseling Services, a division of Family Services, Inc. “Ideally, while in school the student will build a thick credit file, and graduate with a positive credit report and high credit score, allowing them to then realize some of the financial dreams they’d put on hold until graduation. But providing an 18-year-old with little financial training access to a credit card is not only risky, it could be downright disastrous.”

When it comes to building a positive credit record, the student has some options. Family Services, Inc. suggests that parents and young adults consider the following when deciding what would be best for their situation:

• Become an authorized user on the parent’s card. This is a practice known as piggybacking, and is exactly what it sounds like. The student is attached to the parent’s card and has charging privileges, but no legal responsibility for payment since the card is not in his or her name. The activity on the account is reported to the credit bureau in both the parent’s name and the student’s name, thus the young adult builds a credit file of their own. This option allows the parents to monitor the student’s spending, and remove them from the card if things get out of hand.

• Get a secured credit card. This type of credit card requires a cash collateral deposit which then becomes your line of credit, thus limiting any abuse. Consumers need to be very careful when applying for this type of card, as some charge high fees which can greatly diminish your spending power. You can also expect a secured card to have an annual fee and a higher interest rate than an unsecured card. Make sure that the issuer reports to the credit bureau. If they do, and if you pay responsibly, a secured card can not only be a safe way to build a credit file, but after a year or so will likely qualify you for an unsecured card.

• Obtain a card in the student’s name. Since the clock is ticking on the availability of this option, it definitely merits a conversation between the student and the parent. If the young adult has some financial training and experience with credit, and has demonstrated that he or she can handle it responsibly, then having a card in their own name could be a good way to launch their own credit file. Student credit cards typically have low credit lines, thus somewhat limiting the amount of financial damage that can be done. However, an irregular payment history on even a small debt can damage a credit file, which defeats the purpose of having a card.

In addition to lenders, employers and landlords also review credit reports. Therefore, it is important to graduate from college, not only with a sheepskin in hand, but a positive credit file. If you need help evaluating the risks and responsibilities associated with credit, reach out to a trained and certified credit counselor at Family Services, Inc. by calling toll-free to 800-232-6489 or go online to www.fsisc.org.

How To Negotiate With Your Creditors

Consumers Need a Back-up Card

Face it, we live in a credit-dominated society. Most of us can pay cash for our daily living expenses, but when it comes time to make a major purchase such as a house or a car, we need a thick credit file with a long history of responsible payments. Credit is a convenience that keeps us from having to carry large amounts of cash, and also allows us to buy now and pay later. Admittedly, many people have taken that perk to an extreme, but used appropriately, credit can be our friend.

Many consumers are now faced with having their existing lines of credit impacted by changes to the terms of their account. Higher interest rates, lower spending limits, increased minimum monthly payments, or even closed accounts have put many on the financial ropes. For this reason, Family Services, Inc. makes the following recommendations if the terms of your account are altered:

• Ask for an explanation. Everyone deserves to know why the terms of their account were changed, so definitely inquire. Among other things, the creditor may close an account due to inactivity, because you no longer fit their business model, because you’ve become too much of a risk, or you’re no longer profitable.
• Fight to get your previous terms reinstated. If you’ve had a sporadic pay history, are at or near your credit limit, or rarely use the card, you may not have a leg to stand on. However, if you’ve been a good customer, it’s worth it to call the issuer and plead your case, but you must have your financial ducks in a row before picking up the phone.
• Build your case before you call. Know how long you’ve been a customer, the amount you usually charge each month, and underscore your good payment history.
• Prove that you’re worth having. Get your credit report for free from www.annualcreditreport.com. Review it for accuracy. After all, you want to make sure that you and the creditor are seeing the same information. Next, pay the few dollars it costs to get your credit score. If you have a solid credit report and high credit score, you should be just the kind of customer any issuer wants.
• Make them feel secure. Point out that you’re in a field that is not susceptible to layoffs, and that you have a steady income.
• Be prepared to negotiate. Know what you want before you call, and be willing to negotiate if you have to. In other words, if your interest rate has been raised and your credit limit has been lowered, start off asking that both be returned to the previous levels. However, figure out in advance which is more important to you. Do you need a low rate because you carry a balance over from month-to-month, or does a high line of credit matter more to you? If you end up in a stand-off with the creditor, you’ll know where to give.
• Ask for a supervisor. If you’re not getting the answers you want, move up the ladder until you either get what you’re after, or are convinced they are going to stand firm with their decision.
• Inquire about the opt-out clause. If it makes more financial sense to do so, ask to have your account closed, with you continuing to pay the balance under the former terms. This option is often the right one for consumers who have had their interest rate or minimum payment raised to an unmanageable level. If it’s going to be a true financial hardship to meet the new terms, then it’s better to close the account.

“Even though having more plastic can equal more temptation, it might be smart to have a back-up card in case you lose charging privileges on your primary card,” says Michaele Pena of Consumer Credit Counseling Services, a division of Family Services, Inc. “Another card can be a safety net that will keep your access to credit open. Credit can be difficult to obtain, so testing the waters by applying for one more card – not a wallet full - before you actually need it will provide a degree of comfort during these uncertain times.”

For help making sound financial decisions, building a budget you can live with, or assistance digging out of debt, reach out to a trained and certified counselor at Family Services, Inc. To find the location closest to you, call Family Services, Inc. at 843-735-7802, or go online to www.fsisc.org. For counseling in Spanish, dial (800) 682-9832.

Choosing Homeownership

From: Military.com By: WellsFargo

Homeownership is about security, comfort, and fulfilling the American dream. The sense of community that comes with putting down roots in a place of your own, the security of owning the roof over your head, the opportunity for financial growth--all these accompany the choice to become a homeowner.

But buying a home is also the single largest investment most people ever make. Along with all the benefits of homeownership comes the responsibility to manage that investment wisely.


Benefits of homeownership

The rewards of owning your own home include many benefits unavailable to renters. Among other things, homeownership allows you to:

Start building wealth: Making a mortgage payment every month builds up your equity stake in your home, contributing to your long-term savings and helping you solidify your financial future.
Reduce your tax burden: The interest you pay on your mortgage is usually tax-deductible, which can lead to significant tax savings--especially in the early years of the mortgage term, when most of your monthly payments go toward interest. Make sure you consult your tax advisor about the deductibility of interest.

Build your credit history: Timely mortgage payments can contribute to a positive credit history.

Eliminate landlord hassles: You'll no longer have to fear non-renewed leases and rent increases.

Make the house your own: Aside from zoning rules, Homeowner's Association requirements, and local building codes, you'll be free to decorate, remodel, and renovate as you wish.


Responsibilities of homeownership

Before deciding to buy a home, consider the responsibilities that will accompany your purchase. You will most likely have to make some adjustments to account for the following:

Additional financial responsibility: Whether buying is more costly than renting depends on your individual circumstances. As a renter, some or all of your utilities may have been paid for, but now they will be solely your responsibility. You'll also be responsible for property taxes and homeowner's insurance in addition to your loan.

Maintenance and repairs: Maintaining your property will be up to you, not the landlord.

Less mobility: Unlike having a lease where you can move with minimal notice, moving when you own a home is more complicated since you're responsible for ensuring the mortgage gets paid.

Depreciation: Real estate often increases in value over time, but not always. Owning a home means facing the risk that its value will depreciate.

Beyond the financial benefits, the personal rewards of homeownership can be tremendous--as long as you prepare for the responsibilities that come along with it, and choose a home and a mortgage that are well-suited to your needs.

$8,000 First-Time Homebuyer Tax Credit

Some Quick Q&A

When do I need to purchase to qualify?
If you buy a home between Jan. 1 and Dec. 1 this year and close escrow during these dates, you will qualify for an $8,000 tax credit - as long as it is your primary residence and you meet the simple requirements.

How does the law define "first-time homebuyer"?
The law defines "first-time homebuyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase.

What are other requirements to qualify?
All U.S. citizens who file taxes are eligible to participate. An income limit of $75,000 a year for individuals and $150,000 a year for joint filers also applies.

How do I apply for the credit?
Taxpayers should use IRS Tax Form 5450 to claim the first-time homebuyer tax credit.

Does the credit have to be repaid?
No. Unlike a similar tax credit passed in 2008, this $8,000 tax credit does not have to be repaid to the IRS.

Can I use the tax credit toward a down payment or other closing costs?
Yes. An announcement made May 29 allows the tax credit to be used toward purchase costs of a home, including down payment in some cases. This can be done one of two ways. First, buyers using an FHA-approved lender can sell their anticipated tax credit to the lender and use the proceeds to immediately apply the tax credit to any down payment above the minimum down payment of 3.5 percent required with FHA-insured mortgages. Second, buyers who receive financing through state housing finance agencies and certain non-profits will be able to use the tax credit for their down payments via a tax credit advance loan that does not result in any cash back to the buyer.

New Law Puts Credit Card Companies in Crosshairs

From Military.com By Kelly Johnson

A new piece of legislation was recently signed into law that has credit card companies in its crosshairs. The Credit Cardholders’ Bill of Rights Act of 2009 aims to protect credit card holders from unnecessary interest rate hikes, finance charge increases and other unfair practices that ran rampant in the past.

The act — signed into law by President Barack Obama on May 22 — amends the Truth in Lending Act to prohibit creditors from increasing the annual percentage rate of interest (APR) to an existing credit card balance unless specified conditions are met. Additionally, creditors are prohibited from extending a line of credit to consumers under age 18, unless they’re emancipated under state law, or the consumer's parent or legal guardian is designated as the primary account holder.

According to bill sponsor Rep. Carolyn Maloney’s (D-NY) website other notable provisions include:

• Prevents cardholders who pay on time from being unfairly penalized.
• Protects cardholders from due date gimmicks.
• Shields cardholders from misleading terms.
• Empowers cardholders to set limits on their credit.
• Requires card companies to fairly credit and allocate payments.
• Prohibits card companies from imposing excessive fees on cardholders.
• Prevents card companies from giving subprime credit cards to people who can’t afford them.
• Requires Congress to provide better oversight of the credit card industry.

Consumer advocate organizations and lawmakers applaud the signing of the bill of rights. The Center for Responsible Lending released a statement the day President Obama signed the act stating:

“The Credit Cardholders Bill of Rights arrives just in time. If deceptive credit card activities continued unchecked — as with subprime mortgages — the results would be even more devastating for borrowers and an economy already struggling to avoid financial ruin.”

Democratic National Committee Chairman Tim Kaine also commended the move to protect credit card holders, calling the bill “comprehensive reform” that will “make it easier for Americans to pay down their debt and empower consumers to understand the terms of the credit card agreements.”

The new regulations won’t go into effect until the summer of 2010, which according to some financial experts, gives creditors time to hike up interest rates before they have to abide by the new regulations. However, Maloney has a way for consumers to register complaints if credit card issuers continue unfair practices.

Maloney proposed The Banking Hotline bill (HR 1455), which will establish a single toll-free number and website to help consumers register complaints about their banks.

10 Reasons Why The Homeownership Resource Center is Such a Valuable Asset to the State

1. The Homeownership Resource Center (HRC), a division of Family Services Inc., is the lead agency in the nation for helping individuals and families foreclosures. Our success rate hovers between 66 and 70% -- that’s unmatched anywhere else in the nation.

2. The HRC’s Mortgage Default Clinic model has been recognized as a best practice by Neighborworks America.

3. The HRC regularly receives referrals from politicians at every level, including state representatives and senators, county officials, and members of the US Congressional delegation.

4. HRC counselors recognize foreclosure scams, and since the housing crisis started 2 years ago, it has helped hundreds avoid sending money to particular people or entities promising things that sounded too good to be true. Additionally, the HRC – working with the state’s Department of Consumer Affairs – has helped many homeowners recoup their dollars.

5. The HRC has a Critical Response Coordinator, who is especially adept at pulling homes back from the auction block – in many cases, with less than 24 hours notice.

6. The HRC has unique access to mortgage lenders, servicers and providers and utilizes special phone and fax numbers, and has the ability to email designated points of contacts. Homeowners, calling on their own, face the 800-customer service number. HRC counselors speak to the representatives who can make real-time decisions.

7. HRC counselors are licensed and certified by state and national agencies. Additionally, continuing education credits required quarterly. Our counselors go beyond the standard to target emerging trends.

8. All the HRC’s mortgage default counseling services are available statewide and to residents in North Carolina. (Bankruptcy and credit counseling are not available due to state licensing laws.)

9. As a HUD-certified agency, the HRC does not charge for mortgage default counseling.

10. While the HRC works efficiently and knowledgeably, compassion for people is its hallmark, and while hundreds, if not thousands, of homes have been saved, it celebrates that families will remain together; kids won’t have to change schools, and that seniors can enjoy their golden years in the homes that hold a lifetime memories.

HRC Hails Supreme Court Decision on Foreclosures

With the State Supreme Court decision to temporarily halt foreclosure sales of Fannie Mae, Freddie Mac, and other lenders participating in the new government program, many families whose loans are eligible for modification will have another chance to save their property. “We are especially pleased because we are beginning to see some flexibility from lenders with respect to the government’s new Making Home Affordable plan, which includes both a refinancing and modification option,” said Toby Smith, a certified and licensed counselor at The Homeownership Resource Center (HRC), a division of Family Services Inc.

“One of our concerns was always that there would not be enough time to get the new program in place for those who were already in the pipeline. This is a wonderful turn of events and we hope it will prove beneficial for those who meet the criteria for modifying their loans. We stress the modification option especially because a client who is behind or who has been behind for awhile does not really have the option to refinance their home loan because of damaged credit,” added Smith.

It appears that the injunction will be limited to 90 days so this represents a significant window opening for many folks who may not have taken any action at all. If a homeowner does not know who the investor is for their loan, that information can be determined by calling the lender, and the HRC is more than willing to help.

“Any time you seek help, you are making a good move. In many cases, something can be done to save a home,” noted Smith. Plaintiffs in foreclosure (lenders) have until May 15th to advise if the loan is subject to modification under the federal program. If the loan is not, then the foreclosure sale can proceed. “The next 10 days will be critically important for thousands of homeowners throughout the state,” stressed Smith.

The HRC continuously holds mortgage default and foreclosure clinics for homeowners who are behind on their mortgage or facing foreclosure. Clinics for the greater Charleston area are held on the 1st and 3rd Tuesday on each month from 6 to 8 pm at 4925 Lacross Road, Suite 215 in North Charleston. Homeowners throughout the state can locate a clinic near them by visiting the HRC’s website at www.ForeclosureHelpforSC.org or call 888-320-0350. Additionally, for those in the upstate, a clinic will be held this Saturday in the Greenville area at the Metropolitan Missionary Church, 22 Boland Court. Clinic times are 9 am, 11 am and 1 pm and no pre-registration is required. For more information, visit www.foreclosurehelpforsc.org or call 888-320-0350.

The Foreclosure Process Doesn’t Always Result in the Sale of a Home

by Toby Smith, Counselor

Recently, a very distressed homeowner called The Homeownership Resource Center, a division of Family Services, Inc., absolutely certain that the family home was going to be auctioned off at a foreclosure sale the next day. After calming the caller, we collected the necessary information about the mortgage, budget, and correspondence received from the mortgage lender. What we learned after talking to the mortgage company is this:

1) The caller was 8 months behind and the account had been sent to an outside attorney specializing in foreclosures. That attorney started the legal part of the process by sending the homeowner a lis pendens order – the formal and public notice of default.

2) The caller insisted that she did not receive any documents and did not know that she had 30 days from the date of being served the lis pendens order to respond.

3) Meanwhile, a request to modify the homeowner’s loan was coming up for review, but because it was taking so long, a “projected” sale date was set. When the homeowner called the mortgage company to ask about an update on her request, she was told that an actual sale date, not a projected one – had been put in place.

4) Once those points were clarified and the caller realized that her home was not in danger of being sold the next day, all stress levels (including mine) returned to normal. Additionally, the mortgage company advised that the modification request had been assigned to a negotiator, which is usually a positive step toward a permanent change in the loan terms.

We will check back with the homeowner and the mortgage company every week until a resolution is reached.

In South Carolina, foreclosure is a legal process that must go through the courts. In addition to the homeowner, the public is notified via ads placed in the local newspapers. After being served a lis pendens order, a homeowner has 30 days to respond, but more important to note is that even during this period, a resolution can still be worked out. In fact, a homeowner has until the scheduled hour of the sale to save the home. I have been involved in several foreclosures that have come down to the wire and when the home is saved, it is very gratifying; on the other hand, when the home is lost, is hurts very deeply to know that someone is going to be displaced. One more thing – down to the wire transactions almost always require a payment in certified funds. Several months ago, I had a client lose his home at the last minute because he showed up at the designated location with a personal check…

The foreclosure process varies from state to state. Click this link to get more information www.realtytrac.com. Regardless of where you live, seek the services of a HUD-certified counseling agency, never, ever pay for services, and remember – being in the foreclosure process does not always mean that a home is going to be sold. Don’t give up!

For help in North and South Carolina, call 888-320-0350; nationwide, 888-995-Hope.

The Counselor's Corner

From one missed payment to a critical response intervention...

by Toby Smith

Consider the phases of missed mortgage payments:

Phase 1: Okay, we missed this month’s payment because of the cutbacks, but we can catch up by juggling a few things.

Phase 2: Well, I thought we could catch up, but I didn’t plan on the alternator going out. The car has to get repaired so we can continue to go to work.

Phase 3: Oh my goodness! We are 3 months behind and the phone calls are driving us crazy. Why don’t these mortgage lenders leave us alone!

Phase 4: We’re in serious trouble, but still won’t talk to “them” or open the mail.

Phase 5: An attorney’s office sent us papers today. Maybe we better open the mail and find someone to talk to – NOW!

Phase 6: I have called that counselor 16 times! Why won’t anybody return my call?

Phase 7: The counselor and lender had another long conversation today. We have to come up with the money by next Friday. That’s it.

Phase 8: I can’t believe this is happening. What are we going to do?!?

Does this sound familiar?

It’s amazing how often this scene gets played out in the offices of The Homeownership Resource Center. Equally fascinating though – and less known – is that the situation can still be turned around; even in Phase 8, when things get down to the wire. My colleague, “California cool” Mary Regan is the coordinator of the Critical Response Unit and she often mentions that 3 things must be in place to save a home from auction: a solid budget showing a surplus, stable employment and some cash.

Okay, more than just some cash. Lenders usually will accept either a negotiated amount of the arrearages or the full amount of all past due payments. In Phase 8, there is no room for equivocation; either the home gets saved from auction (and the negotiating continues if the full amount to reinstate the loan is not paid) or sadly, the sale occurs. Fortunately, for many clients, Mary is in place and her saves are becoming the stuff of legend.

We, however, strongly encourage any homeowner in trouble to come see us now…in Phase I…before one missed payment ends up requiring a critical response.

The worst thing you can do is to do nothing. Contact us today. In North and South Carolina, call 888-320-0350.