10 Free Holiday Activities for Couples Paying off Debt

  This is where it all started guys. On a quiet summer afternoon I hit publish on my first post titled 10 Free Activities for Couples Paying off Debt and the rest is history. I thought it fitting to do…

The post 10 Free Holiday Activities for Couples Paying off Debt appeared first on Modern Frugality.

Source: modernfrugality.com

What You Should Know About the Right of Redemption

If you are a homeowner with a mortgage, you might have heard about your right to redemption. For those who have been struggling to make their house payments, this is one route that can be taken to avoid foreclosure.  

What is the Right of Redemption?

If you own real estate, making mortgage payments can be hard, but foreclosure is something that most people want to avoid. The right of redemption is basically a last chance to reclaim your property in order to prevent a foreclosure from happening. If mortgagors can manage to pay off their back taxes or any liens on their property, they can save their property. Usually, real estate owners will have to pay the total amount that they owe plus any additional costs that may have accrued during the foreclosure process. 

In some states, you can exercise your right to redemption after a foreclosure sale or auction on the property has already taken place, but it can end up being more expensive. If you wait until after the foreclosure sale, you will need to come up with the full amount that you already owe as well as the purchase price.  

How the right of redemption works

In contrast to the right of redemption, exists the right of foreclosure, which is a lender’s ability to legally possess a property when a mortgager defaults on their payments. Generally, when you are in the process of purchasing a home, the terms of agreement will discuss the circumstances in which a foreclosure may take place. The foreclosure process can mean something different depending on what state you are in, as state laws do regulate the right of foreclosure. Before taking ownership of the property through this process, lenders must notify real estate owner and go through a specific process. 

Typically, they have to provide the homeowner with a default notice, letting them know that their mortgage loan is in default due to a lack of payments. At this point, the homeowner then has an amount of time, known as a redemption period, to try to get their home back. The homeowner may have reason to believe that the lender does not have the right to a foreclosure process, in which case they have a right to fight it. 

The right of redemption can be carried out in two different ways:

  • You can redeem your home by paying off the full amount of the debt along with interest rates and costs related to the foreclosure before the foreclosure sale OR
  • You can reimburse the new owner of the property in the full amount of the purchase price if you are redeeming after the sale date. 

No matter what state you live in, you always have the right to redemption before a foreclosure sale, however there are only certain states that allow a redemption period after a foreclosure sale has already taken place. 

Redemption before the foreclosure sale 

It’s easy to get behind on mortgage payments, so it’s a good thing that our government believes in second chances. All homeowners have redemption rights precluding a foreclosure sale. When you exercise your right of redemption before a foreclosure sale, you will have to come up with enough money to pay off the mortgage debt. It’s important that you ask for a payoff statement from your loan servicer that will inform you of the exact amount you will need to pay in order save your property. 

Redemption laws allow the debtor to redeem their property within the timeframe where the notice begins and the foreclosure sale ends. Redemption occurring before a foreclosure sale is rare, since it’s usually difficult for people to come up with such a large amount of money in such a short period of time. 

The Statutory Right of Redemption after a foreclosure sale 

While all states have redemption rights that allow homeowners to buy back their home before a foreclosure sale, only some states allow you to get your home back following a foreclosure sale. Known as a “statutory” right of redemption, this right as well as the amount of time given to exercise it, has come directly from statutes of individual states. 

In the case of a statutory right of redemption, real estate owners have a certain amount of time following a foreclosure in which they are able to redeem their property. In order to do this, the former owner must pay the full amount of the foreclosure sale price or the full amount that is owed to the bank on top of additional charges. Statutory redemption laws allow for the homeowners to have more time to get their homes back. 

Depending on what state you live in, the fees and costs of what it takes to exercise redemption may vary. In many cases during a foreclosure sale, real estate will actually sell for a price lower than the fair market value. When this happens, the former owner has a slightly higher chance of being able to redeem the home. 

What You Should Know About the Right of Redemption is a post from Pocket Your Dollars.

Source: pocketyourdollars.com

How to Pay Off Debt – Fast!

The post How to Pay Off Debt – Fast! appeared first on Penny Pinchin' Mom.

Americans are in debt.  It’s one of the main reasons couples fight and a leading cause of stress.  Fortunately, there is a way you can get out of debt.

tricks to getting out of debt fast

Anything worth having in life takes hard work and dedication.  And, the sense of accomplishment and joy when you can tackle what seems to be the impossible, is a great feeling.

The same is with your debt.  Paying it off is NOT easy.  It is going to take a lot of time, but it is so well worth it!

Of course, before you can start to pay off debts, you need to follow the right steps.  It is imperative that you’ve already done the following before you start working on paying off those debts you have.  These include:

  1. Preparing your Net Worth and Debt Paydown Forms
  2. Understanding your Money Attitude
  3. Creating Your Budget
  4. Learning How to Use a Cash Budget (Envelope System)
  5. Setting up Your Emergency Fund

Once you’ve tackled these steps, then you get to start the fun part, which is paying off your debts! If you haven’t, you will want to take the time to read each post and follow the steps.  You really should not try to get out of debt until these steps are done.

 

HOW TO GET OUT OF DEBT FAST

It is fun to watch your debts slowly disappear!   However, it is important that you are ready.  If you are ready, then read on!

KNOW HOW MUCH DEBT YOU HAVE

You need to make sure you know exactly how much you owe and to whom.  I recommend completing a debt pay down form.

This form should list all of the debts you owe, listed from the lowest balances to the highest, as well as your minimum monthly payment.

 

Debt Payoff Forms Bundle

To begin, review your budget.  Hopefully, you were able to find some “extra” money.  By extra money, it means money you have left over after meeting your needs.   When you can free this up in your budget, it is what you will pay towards your debt.

For example, if you were able to lower your grocery bill from $800 to $650 a month, that means you now have $150 to apply to your debt.  My husband and I did this, and it made a HUGE difference.  We did everything we could to reduce our grocery budget from using coupons to menu planning and changing the foods we ate.

Because getting our debt paid off was so important, we eliminated dining out from our budget. For us, it was important to sacrifice in the short term to get ourselves out from underneath our debt.

When you find this extra money, you apply that to your debt. Start by paying any additional money towards the debt on which you owe the least.  Here is an example:

Citibank – $500 owed — minimum payment $10
Visa – $875 owed — minimum payment $15
Ford — $10,475 owed — required monthly payment $375

If you find that you have $25 left over in your budget, apply that towards the lowest debt.  Your form will look something like this now:

Citibank – $500 owed — minimum payment $10 monthly payment $35
Visa – $875 owed — minimum payment $15
Ford — $10,475 owed — required monthly payment $375

Continue to make the payments to these debts as listed.  Then, when Citibank it paid off, you will roll the $35 payment into the Visa payment, like this:

Visa – $875 owed — minimum payment $15 monthly payment $50
Ford — $10,475 owed — required monthly payment $375

Continue this same process.  And, as there is more money freed up in your budget, apply it towards this debt.  Once you start seeing the balances decrease, you will be more motivated to cut your spending and slash your debt.

That is what happened to us.  We were so excited to see those balances decrease that we kept finding more ways to not only reduce our monthly spending but to find more money!

 

HOW TO PAY OFF YOUR DEBTS MORE QUICKLY

Of course, the first step to paying off debts is to find money in your budget to apply towards them.  It can also be beneficial to use larger amounts of cash towards your debts, or even find ways to free up even more money.  Here are some things you might try:

  • Sell items on Craiglist, eBay or other methods.  If you have extra things lying around the house, you may wish to sell them and raise some money and then turn around and make a nice big payment on that smallest debt.
  • Get another job.  If you can swing it, pick up a part-time job and apply all of your earnings towards your debt.  You can try your hand as an Uber driver or even a freelance proofreader.  You can find more ideas on how you can make money from home.
  • Reduce savings and pay down debts.  If you happen to have MORE than $1,000 in the bank currently, but still have debts, you should take any amounts above $1,000 and pay down your debts BEFORE you are saving.  The reason is why are you saving money for yourself and paying more in interest to someone else than you are making yourself?

Get creative!  There are many ways you can find extra money in your budget.  One of these 50 ways to make money to pay off your debt might be the perfect solution for you!

 

HOW TO USE YOUR TAX REFUND

So, what about that nice big tax return that might be coming your way?  Experts say that you should use the rule of thirds:

1/3 towards the past — use to pay off debts
1/3 towards the present — have some fun
1/3 towards the future — savings

If you genuinely want to get out of debt, I would recommend you do the following:  Make sure that you have at least $1,000 in the bank, so your Emergency Fund is funded.  Then, apply any leftover tax refund towards your debt.

We would all love to blow our return on something fun, such as a new TV or vacation.  But, you have to decide if you want that instant gratification (which may turn to guilt) or if you want to get yourself out of debt.  While I can only recommend that you work on the debt first, this is a question only you can answer.

 

WHY NOT CONSIDER INTEREST RATES?

I hear this over and over again “You should pay off the highest interest rate debt first!”  I do not agree with this, and the reason is this – behavior.

Most people need to see that they are reaching goals.  We need to see the fruits of our labor.  By paying off the smallest balance first, it gives you a sense of accomplishment.

You see what you are doing is actually working and you keep working to pay down other debts.  That gives the motivation to keep on as you can see that you are paying off debts and can do this!  GO YOU!!!!

If you work on only the balance with the highest interest rate first, it may take longer actually to pay it down.  Because the rate is higher, it may take longer to tackle the principal balance, since most of your payment always goes towards interest.  This can result in more frustration and you wanting to quit as you feel you are getting nowhere.

Look at it this way; if you were not trying to get out of debt, you would still increase debt due to interest rates, right?  So, if you can do something that gets you on track to start to pay them down one at a time, you are already making a difference in how you look at your debts.

Of course, if you feel better about listing via interest rate, that is what you need to do.  There is not a right or wrong way to pay off your debts.  Just keep in mind that if you find yourself frustrated with progress, you might try to change it around and tackle that lowest balance first.  It just might make the difference for you.

CLOSING THOUGHTS

Getting out of debt is not easy. I’ve been there and know how difficult and challenging it can be.  However, having the tools you need to make it happen is key to your success.

Read our Financial Reboot Book or take the Financial Reboot course to learn even more about not only getting out of debt but how to better manage your money.

 

get out of debt

The post How to Pay Off Debt – Fast! appeared first on Penny Pinchin' Mom.

Source: pennypinchinmom.com

Is Being Debt Free Worth it?

I had a great talk with Millennial Money Man yesterday and my favorite piece of advice he gave me was to “write what you’re passionate about.” It took me literally five seconds to think of the one thing I’m really passionate…

The post Is Being Debt Free Worth it? appeared first on Modern Frugality.

Source: modernfrugality.com

3 Ways to Change Your Relationship with Money

Most people have a love-hate relationship with money. When you’ve got cash to spend, you feel fantastic. You can do whatever you want, go wherever you like, and there’s no worries in your mind. However, when your cash flow starts to dwindle, your entire outlook suddenly goes sour. The high of having cash can mean that you even end up spending it too quickly, so you end up putting yourself in a more difficult situation long-term. Changing your relationship with cash can be one of the first steps to ensuring that you have more of it in your future. If you can take a more positive approach to the way you handle your finances, you’ll be less likely to end up in debt. So, how can you change your relationship with money?

Do Your Research

Most people struggle with their financial freedom because they don’t actively pay attention to the way that they’re spending money. You sign up for essential things like gas and electric and continue paying the same bill for months without checking whether you could be getting a better deal elsewhere. Actually doing your research and making sure that you’re not missing out on opportunities to save will ensure that you can discover some quick wins for your cash flow. You could even find that you can get out of debt a lot faster and make a huge difference to your savings account by refinancing your existing student loans and similar debts into a loan with a private lender. One small change can make a big difference. 

Automate Your Savings

Do you find it hard to stop yourself from spending every penny you earn each month? You’re not alone. A lot of people who have a difficult relationship with money discover that it’s difficult for them to just have cash sitting in their bank accounts. That’s why it’s so important to find an easier way to convince yourself to save. One good option is to open a separate savings account where you can transfer a portion of your earnings every month. You can automate this process by setting up a direct debit to ensure that the cash leaves your account at the same time that you get your wages each month. This means that the next time you check your bank balance, you won’t be tempted to save the cash that should be going to savings. 

Educate Yourself

Finally, stop avoiding the opportunity to learn more about money and how it works. Most of us feel so uncomfortable talking about cash that we barely even look at our bank statements. However, only by examining your spending habits can you determine where the best options are for you to make some significant changes. Be willing to develop a better knowledge of how money works, and how you’re using it. It’s also helpful to learn everything you can about things that can make you more money long-term, like investing in stocks and shares, or setting up savings accounts with extra interest.

3 Ways to Change Your Relationship with Money is a post from Pocket Your Dollars.

Source: pocketyourdollars.com