S&P/Case-Shiller Home Price Indices Fall

On September 30th data released by S&P for the S&P/Case-Shiller Home Price Indices showed continued decline in home prices among almost all major US cities measured by the indices.  

Las Vegas has continued to be one of the hardest hit cities with an annual decline of 29.9%.  All city/metro indices show an annual decline ranging from 29.9% in Las Vegas to 1.8% in Charlotte.

David M. Blitzer, the Chairman of the Index Committe at Standard & Poor’s indicated that there was no evidence of a bottom to the current decline.

For the complete report visit Standard & Poor’s website or click here.

My personal take on the current situation is that it will be a solid two years before we see any sign of recovery in the housing market.  Financial and housing sector woes have create ripples throughout our entire economy that are now just starting to reach other sectors.  Retail and manufacturing businesses are already beginning to feel the effect of reduced consumer spending.  Prices will go up and jobs will continue to be lost.  

Let’s take some cues from our grandparents.  Maybe it’s time for a heart-to-heart talk on how they weathered the storm during the great depression.  While I do NOT believe we are entering another depression I believe we all have equal responsibility to put our individual financial houses in order.  Now is the time to save, ensure job stability, work harder, and focus on paying off debt.  It would be ludicrous and irresponsible to believe that the legislature alone can remedy the current financial crisis.

Patience

All of our clients are aware that some creditors may still pursue legal action to collect on debt owed even though our clients have enrolled in Provanta’s Debt Settlement Program.  However, that does not make a creditor’s lawsuit any easier to deal with  In fact, some of our past clients have decided to withdraw and look for other options when litigation began.

I can’t say I blame our clients for making that choice.  Knowing something might happen and then actually experiencing it are two completely different things.  The latter can be extremely unpleasant.

Despite the creditors choice to litigate, we always encourage our clients to stay with the program and reach their ultimate goal of becoming debt free.  We provide support and guidance to help them through the unfortunate situation.  We explain that although one creditor may have filed a lawsuit, it does not mean others will.  More importantly, we continue to negotiate for settlements on accounts even if the accounts are in litigation or have judgments.  Settlements may still be reached in these situations.

For example, a client who recently graduated from Provanta’s Debt Settlement Program started the program with 7 accounts.  In 2006, one of her creditors decided to file a lawsuit and obtained a judgment against our client for a balance of $8100.  We had already settled 3 accounts for her and she had 4 accounts left including the judgment account.

Though she was distraught over her situation, she decided to stick to her original plan- to complete Provanta’s Debt Settlement Program and resolve her unsecured accounts.  We continued negotiations with the remaining creditors.  About a year later, in the spring of 2007, the creditor who filed a lawsuit finally realized our client would not be able to pay the judgment.  They offered to settle the account for $5698.  This was a good offer considering our client’s situation so we helped her take advantage of it.

Even though this particular account settled for 70% of the balance, the overall settlement percentage for our client at the end of her program was 42%.

(Ref. 1536)

Give Yourself an Early Christmas

Yes, it’s October 1st and yes, I did say “Christmas”.  I am ordinarily one of the first to complain about how Christmas decorations seem to promulgate retail establishments sooner-and-sooner with every passing year but this year is different.  Why?  The meltdown in the financial markets and the economy has given everyone in this country the opportunity to take a second look at their personal financial circumstances.  The observed changes to a certain extent effect everyone. 

What does Christmas, the financial sector, and the economy have to do with each other?  Well, as you may or may not know most retailers go “in the black” during the holiday shopping season.  In other words the sales/revenue generated during the holiday season typically predicates whether or not they turn a profit for their fiscal year.  What this means is that they are absolutely dependent on American consumers having disposable income to spend on gifts and the like during the holiday rush.  If Americans don’t spend as they ordinarily would then retailers may suffer, may actually end the year “in the red”, and may not be able to sustain growth during the next fiscal year.  Some may even go out of business.

To this end I am encouraging everyone to start preparing now.  Buy your Christmas gifts a little earlier this year.  Look for sales.  More importantly create a budget for October, November, and December.  Don’t wait until the last minute to load up your credit cards with gifts on December 24th.

The most significant and important gift one can give themselves or their family is a balanced budget.  I realize this is not a very exciting topic but if you work toward this end now then you may actually have a worry free holiday season.  If you currently carry a large amount of revolving unsecured debt on credit cards and personal loans now is absolutely the time to strategize as to how you are going to pay off the debt.  Don’t wait until the new year!  If you cannot balance your budget and cannot pay off your unsecured debt within three to four years on your own then it is time to reach out and look for some professional help.  Investigate your options.  Find a reputable company with a proven track record of success to help you plan on how to eliminate your debt.

Give yourself and your family the ultimate gift this year – financial freedom.

Continuing Support for Clients

Last month a client contacted us and asked if we could add his wife and her accounts to his current debt settlement program.

The client had enrolled in our debt settlement program earlier this year.  He and his wife had always kept their credit cards separate so his wife was not required to join the program although we highly recommended that she did.   Our client has been battling cancer for the past five years, had brain surgery to remove a tumor and only received disability income since he can no longer work.  They had an extreme medical and financial  hardship which made our debt settlement services suitable for both of them.  However, our client was hopeful that if we could help him with his accounts, they would be able to manage his wife’s debt on their own.  They wanted to try to maintain her credit rating as well as have access to a credit card in case of emergencies.

Seven months later, I am working with the wife to add her accounts to his program.  Although they have tried to keep up with her bills during this time, their situation has worsened.  She fell behind on payments a few months ago and have not been able to catch up since.  She has gone through some personal medical problems, have had surgeries and missed a lot of work.  The emotional stress of dealing with financial and medical problems escalated into a deep depression for our client’s wife.   On top of this, our client’s cancer, which had been in remission for a little while, has come back.  He will start chemotherapy next month.

I was extremely sad to hear that our client’s situation has gotten to this point.  While I am glad they decided to enroll her accounts, I wish their decision was motivated by different circumstances.   Our services will not be able to help them with the medical struggles they’ll soon be facing but we can help alleviate some of their current financial burdens.

(Ref. 1535)

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