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We represent many consumers in Bankruptcy, and getting our Clients back on their feet afterwards is a big part of what we do. Often, cases are driven by upside-down home loans or even reasonable loans in which payments have become too high because the homeowner lost their job or had to take a lower paying job as a result of the Great Recession. One option for those who’ve gone through Bankruptcy and are looking to borrow again is the FHA Loan.

Before the housing bubble burst in 2008 FHA loans were considered the choice for buyers with little credit or bad credit; or an option for those with low incomes. But since everyone’s home value began falling – often taking their credit standing with it – FHA mortgages have become more widely appealing, especially when compared to conventional loans that require private mortgage insurance (“PMI”). PMI is the mortgage lender’s way of ensuring it gets paid following default. It is insurance for which the borrower pays the premium, adding to the cost of the loan.

For those considering an FHA Loan, keep these points in mind:

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Recently I got an e-mail from the newly-formed Consumer Financial Protection Bureau (CFPB). You remember the CFPB, right? No? That’s alright. But you probably remember the agency’s public face, now-Senator Elizabeth Warren of Massachusetts.

So, after coming out of the shoot a few years with the President’s blessing and much fanfare, the CFPB has released the first of several consumer-friendly web-based guides. This one is its Guide to Owning and Buying a Home.

The 3 primary resources offered on the CFPB site are:

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Where Did the Equity Go?

If you’re an Illinois homeowner chances are any equity you had in your home disappeared between 2008 and 2011; and hasn’t been seen since. If you’re lucky that equity may start crawling back to “normal” levels in 2013; but if you haven’t seen it happen you’re not alone. Despite recent reports in the news about recoveries in California, Arizona, and Las Vegas, Illinois property values continue to languish. Of course it’s not all bad news. For instance, as of January the overall price of housing in the Chicago area was up 3.3% from a year ago, with condo prices up a robust 5.8%. Then again, the Illinois foreclosure rate has merely leveled off rathern than falling as it has in other States. And as the “jobless recovery” grinds on, a few basic truths are coming to light:

The value of real estate is still well below pre-crash levels and many people borrowed against those inflated values. These people owe well more than their homes are worth.

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Written by Jonathan Trent and Mazyar Hedayat  Edited by Mazyar M. Hedayat, Esq.

Small business remains the backbone of the most vibrant economy in the world. America leads in innovation and hard work thanks in large part to small businesses and entrepreneurs. But despite the best intentions of their owners small businesses have a high failure rate; especially in the first few years of operation. 

But why the high failure rate? One of the most common reasons is that the business owner, entrepreneur, or manager of the business 

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Guest Post By Jonathan Trent

Edited by M. Hedayat, Esq.

It’s that time of year again! As January winds down business owners are contemplating new projects, new ideas, and New Year’s resolutions. Putting together resolutions can be an eye opening experience… or a chore. Sure, you want to continue improving what works, weed out what doesn’t, and learn from the past to avoid making the same mistakes in the future. But when the rubber meets the road, how do you make that call?

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“It’s not just a low-income problem. We’re seeing folks who are middle and upper income as well… loss of employment has been the catalyst, or a family crisis or some other emergency has triggered the problem.” — Case Worker at NFP Mortgage Counseling Agency

Not-For Profits to the Rescue?
Millions have been put out of their homes by foreclosure, with millions more hurtling in that direction this year. The problem is ripping families apart. Meanwhile, programs such as NeighborWorks America and Housing Counseling Services have been cropping up around the country in response to the permanent housing underclass. Typically such not-for-profit enterprises are funded by Congress through the Department of Housing and Urban Development (HUD). But in 2012 HUD received just half its requested funding and a similar 2013 appropriation is on its way. Why isn’t Washington sold on not-for-profit organizations offering counseling to homeowners? Do such organizations bring solutions, or peddle false hope?

Counselors Can Only Do So Much
If all goes well in working with a counseling agency, counselors can act as neutral go-betweens bridging the gap between homeowners and lenders: but there is only so much that can be done. At the Homeownership Preservation Foundation, 70% of clients are driven to counseling by unemployment; and it’s hard to negotiate with your mortgage company if you cannot establish that you have steady income. Counselors repeatedly stress that clients should not be paying for help when HUD-approved services are free. Of course the fact remains, you get what you pay for and in order to justify its funding from HUD, counseling agencies must maintain a high caseload and open-door policy. Counselors can only do so much. Homeowners who want more tailored advice should consider speaking with a knowledgeable Attorney that can help them sort through their finances.

Don’t Go It Alone: Get Advice
Regardless of whether homeowners look to Federally-funded housing counselors or reach out to a knowledge local Attorney, they should make the decision not to endure the foreclosure process alone. After all, trained professionals are available to help them through the process and the first call and appointment is inevitably free. If you’ve got questions, what have you got to lose?

For a telephone consultation and office visit, contact us at mhedayat@mha-law.com or call 630-378-2200 to set up an office visit. We have convenience payment plans available and work with both consumer and business clients throughout the Chicagoland area. If you believe that it is too early to speak with an Attorney, check out these agencies:

NeighborWorks America
Housing Counseling Services, Inc.
Homeownership Preservation Foundation

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The economy continues to gasp for air. You eye the want ads nervously. Are you one paycheck away from selling the family silver?

You bet! Cruise over to Inforuptcy.com to check out how a lifetime’s worth of heirlooms can be bought and sold by bankruptcy trustees, investors, and guys with too much time on their hands.

And you thought there were no new ideas…

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April is upon us. Time for spring flowers, warmer weather, and taxes. Yeah taxes, no one likes taxes, but you have to file them. For those of you reading this blog, you already know that if you haven’t filed your taxes, you can file for bankruptcy. So just get them filed and move on.

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