Is My Current Lender The Best One To Refinance My Mortgage?

When you are behind on mortgage payments, or simply want to get better terms, seeking to refinance is a good option. A refinance can result in a lower interest rate, a longer repayment term, and/or curing any arrearage on the note. These things all work together to get you a lower and more manageable mortgage payment, which is a good outcome for any homeowner. But you may be wondering if your current mortgage lender is the best place to go for a refinance, of if you should give a competitor a try.

When making the decision to refinance with your current lender, or find a new one, here are some important things to keep in mind:

•         Your current lender will have access to all of your data, and may not require you to fill out lengthy refinance application. Some lenders are able to use a “short form” application when it is their current customer who is seeking to refinance.

•         Your current lender may want to keep you as a customer, because even with a reduced interest rate the bank will make a profit. This can play into your hand when negotiating a new rate, especially if you advise the lender that another bank is making you a better offer.

•         You already have an established relationship with your current lender, and this might make it easier to work your way through what can be a maze of document requests.

There is nothing wrong with shopping around, and the key is to find the option that meets your needs the best. This might mean staying put with your current lender, or it could mean it is time to start fresh with someone new. In any event, you will need competent help by your side, and we are happy to take on your case. We will explore your options and help you make a choice that makes sense, and one that can help you stave off a foreclosure or the need to file bankruptcy. Let us put our experience to work for you, so you can get your budget on track and save money where possible.

For more information about how a mortgage modification or refinance can help save your home, call us today or reach us online at www.law-ri.com. We have multiple locations to serve you and can schedule a time to meet at the office most convenient for you.

What Documents Do I Need To Provide For a Mortgage Modification Or Refinance?

If you are behind on your house payments and need a way to save your home, you have several options. Two of the most popular options are to ask your mortgage lender to modify their mortgage loan, or seek a refinance of the loan through a new lender. In either case you will be required to provide information and documents to the lender, and knowing what to begin gathering as you work towards a solution is the first step.

The most common documents requested in either of these circumstances include the following:

•         Proof of income, which may be presented by paystub, W-2 forms, prior years’ tax returns, or a combination of these items.

•         Proof of employment, which provides assurances to the lender that you have a steady income and are able to make the payment under the modified or refinanced loan.

•         In some instances, you may have to provide proof of the value of your home, but this is more likely with a refinance than it is with a mortgage loan modification.

•         A balance sheet of your monthly income and expenses, which also aids in assuring the lender you are able to make the payments.

•         A completed application for modification or refinance, as provided by the lender.

•         Information about your homeowner’s insurance and property taxes, so those costs can be accounted for in the new loan.

This sounds like a lot, and it can be a lot of work to get together for your lender. Allow us to help, by taking your documents from you and organizing them in a way that will make sense to the lender. When we undertake efforts to help you get a mortgage modification or refinance, we negotiate on your behalf for terms you can meet, and make sure that all the I’s are dotted and T’s crossed with the paperwork, without falling prey to a modification scam. Lenders are notorious for claiming they either did not receive all of the requested documents, or that what was provided was not complete. Before submission of your request to a lender, we take special care to ensure everything is in proper order. Our follow up for a decision is timely, and we report to you the progress at every stage of the process. If you are in need of refinancing your home, or want to see if you can get your current mortgage loan modified, call us today.

For more information about what it takes to modify your mortgage, call us today or reach us online at www.law-ri.com. We offer appointments at multiple locations for your convenience and can schedule a time to visit with you soon.

Three Reasons Having An Attorney Help You Modify Your Mortgage Is Better Than Going It Alone

Many lenders claim that asking an attorney help you get a loan modification on your mortgage is unnecessary, but the opposite is true. If you have ever tried to call your mortgage company and get anything accomplished, you are probably familiar with long wait times and being asked to submit materials more than once. But with an attorney by your side, you can get your modification done faster and make sure that it is done correctly.

Three other reasons to have an attorney help you modify your mortgage, rather than tackling the task on your own, are:

•         If a foreclosure is pending, an attorney will know what steps to take to protect your legal interests during the action. Or, if you are considering or have been offered to give a deed in lieu of foreclosure to your lender, having an attorney take on your case can save your home. A successful mortgage loan modification can stop a foreclosure in its tracks, and can also prevent the need to sign your property back over to the lender by executing a deed in lieu of foreclosure. Another thing you may be considering is a short sale, but a modification will also alleviate the need to resort to this action and will allow you to stay in your home.

•         The stress that can be caused by dealing with an uncooperative lender is taken off of your shoulders when you let an attorney handle your mortgage loan modification.

•         Lenders are less likely to try and “pull the wool over the eyes” of an attorney than they are with a pro se consumer.

While it is true that using an attorney to help you accomplish your financial goals, at a time when your finances are already tight may seem counterproductive, in the end you will be happy you let an experienced professional advocate on your behalf. The money spent is worth the money you will save over time, and the peace of mind that comes with knowing your matter is being handled properly are invaluable. We understand the modification process, and can explain the terminology to you so everyone is on the same page. Our goal is to help you stay in your home, at an affordable price.

For more information about mortgage modifications, call us today or reach us online at www.law-ri.com. We offer appointments at multiple locations for your convenience and can schedule a time to visit with you today.

How A Mortgage Modification Can Help You Fix Your Finances

For the past several years homeowners have taken a huge hit in the value of their homes. This has left many borrowers living in homes valued at well under what is owed, and this makes it hard to turn finances around in a positive way. There are a lot of things you can do to take control of your monthly expenses, and finding the right one can take some trial and error. But the most helpful thing probably has to do with your house payment, so the focus of this article will be on ways to make your mortgage work for you.

One of the things to consider when you are having a hard time making your house payment is to have your mortgage loan modified. If you are able to get a modification, you can expect the following benefits to your entire financial picture:

•         A lower house payment, because the modification will reduce your interest rate. And as we all know, the lower your rate, the lower your payment.

•         With a lower house payment comes more money in your pocket every month. You can use the extra money to pay other bills, or to start a savings account.

•         When you are able to pay your other bills because your house payment is lower, you can avoid going into default on those obligations, which will keep creditors at bay and prevent collection efforts from being taken against you.

•         The extra money you save by having a lower house payment can also be used to start an emergency fund. You never know when an unexpected repair expense will come up, and having the funds on hand to cover the cost will allow you to pay for what is due without going into debt.

If this sounds good to you, it might be time to visit with us to see how we can help you get your mortgage loan modified. If you have tried to get a modification on your own and been denied, we can review your paperwork and contact your lender to see where the process did not work. Most lenders prefer to work with their borrowers than force them into bankruptcy, but it takes artful negotiation to reach an agreement that makes everyone happy.

For more information about how a mortgage loan modification can help with your budget, call us today or reach us online at 

www.law-ri.com. We will help by looking at the facts of your case and giving you options to reach your financial goals.

Tips For A Successful Mortgage Loan Modification

If you are behind on your house payments, or are struggling to maintain your mortgage in a current status, you have several options. Refinancing is a good tool, but certain requirements such as valuation of your home and proof of income must be provided. Another way to achieve similar results is to ask for your lender to modify their mortgage. A modified mortgage is just as binding as the original mortgage, it just includes a variation of the original mortgage terms. Most notably, the interest rate will be reduced, resulting in lower monthly payments. But getting a modification can be hard, so it is a good practice to have a qualified professional by your side throughout the process.

Some tips from within the industry, for a successful mortgage loan modification, include doing the following:

•         Do the math in advance of the final offer, to make sure that you are able to make even the modified payment amount. If not, you should ask for terms that do work for your budget, or look for alternatives such as forbearance or having the past due payments placed at the end of your loan for repayment.

•         Have a good idea of what to expect during the process, which can come from partnering with a competent legal professional to explain the process to you. When you are prepared for what lies ahead, you are better positioned to reach satisfactory results. But if your expectations are not in line with probable outcomes, you will be dissatisfied with the result.

•         Take some time to acquaint yourself with the terminology that will be used, so you understand what is being presented to you. Knowing your role (as mortgagor) and the bank’s role (as mortgagee) will make it easier to read through the paperwork you receive.

It is also a good idea to come up with a budget that includes your new payment, and cut back on things that could prevent you from being successful. Keep in mind that while your finances go in large part to your home each month, you do have other expenses to pay. Writing down your monthly costs will help you see where you can save once your house payment is more manageable. This will allow you to establish a savings or emergency fund, so when money troubles crop up in the future you have a plan in place.

For more information about mortgage modifications and how to manage debt, call us today or reach us online at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations for more convenient one on one office visits.

Can My Lender Foreclose If I Am Trying To Modifying My Mortgage?

Asking for a loan modification of your mortgage is a good idea if you are behind on your payments. A mortgage modification will change the terms of your loan, making your payments more manageable. When you receive a modification of your mortgage you can expect to have a lower interest rate, which means lower payments and you might also be allowed to skip a payment, which means extra cash on hand for other bills. But sometimes lenders drag their feet when processing a modification request, and all too often the right hand does not know what the left hand is doing and it is not uncommon for a foreclosure to be initiated during your modification efforts. If this happens to you, it is important to know your rights.

The process of engaging in foreclosure while considering a loan modification request is referred to as dual tracking, and it is prohibited. The results of dual tracking can include:

•         An erroneous belief on the part of the homeowner that their modification has been denied. This leaves the borrower in the unenviable position of having to defend the foreclosure because they believe they have not been approved for a modification. The undue stress this puts on an already distressed consumer is immeasurable.

•         When forced to defend a foreclosure because of a mistaken belief that a loan modification was not possible, many homeowners simply give up and allow the bank to take back their house. The result is a countless number of would-be homeowners finding themselves without a home due to the practice of dual tracking.

The process of loan modification is confusing, and it becomes even more so when the lender engages in dual tracking practices. If you are considering a loan modification, make sure you have competent representation to protect your interests. When a knowledgeable attorney takes on your request to modify your mortgage, you have the peace of mind knowing that any attempt to foreclose will be met with stiff legal opposition. For help getting back on track with your mortgage payments, or to find out more about loan modification and what the lender can and cannot do during the process, call us today.

For more information about dual tracking and loan modifications, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

What Is Required To Modify My Mortgage?

One way for an underwater homeowner to get the most out of their home and mortgage loan is to ask the lender to rewrite the mortgage. This type of rewrite is most commonly accomplished through mortgage modification, which is when the lender redoes their loan with more favorable repayment terms. Most times the interest rate is reduced or the length of the loan extended, making the payments lower and more affordable. But in order to have your mortgage loan modified, you have to ask. And part of this asking includes providing certain information and documentation. Because lenders are looking at a large volume of modification requests, those that are presented clearly and completely have the best chance of being resolved in a shorter time frame. So, if you are considering seeking a mortgage modification, let us help prepare you and your request.

Some of the things lenders look for when you are asking to modify your mortgage are:

● The ability to repay the modified loan, which can be established by presenting proof of income. Not every case will be one where you have to provide your income for the past several years, as you may have had to do when taking out the loan and this is because the modification is coming from your lender, who already has access to that date from when you took out the loan.

● An application must be filled out and provided to the lender.

● You might be asked to provide tax returns and bank statements, but the time period for which you have to gather these documents should not go too far back.

In some cases, lenders request a monthly budget showing your income and expenses, so a determination as to your need for a reduced payment can be made. Everyone has different circumstances, and the things you will have to do in order to obtain your loan modification depend on your unique set of circumstances. Our office has skilled legal professionals, with extensive experience helping homeowners obtain loan modifications. If you are having a hard time making your house payment, call us to talk about a modification. We will carry the load for you, and make sure all possibilities are explored. Call us today.

For more information about mortgage loan modifications, call us today or reach us online at www.law-ri.com. We offer appointments at multiple locations for your convenience and can schedule a time to visit with you today.

Three Ways Lenders Violate Mortgage Modification Laws

Hands down the largest monthly expense most families have is their mortgage payment. So, when finances take a blow, it can be hard to maintain a mortgage payment that is not in line with a reduced budget. Some homeowners turn to bankruptcy to save their homes, and this is always a good option. However, there are other possibilities and one of those is to seek a modification of your mortgage loan.

A loan modification is a change to your mortgage loan terms, which will permanently alter the payment structure. In most instances the changes involves lowering your interest rate, which results in a lower and more manageable payment. But in order to reap this benefit, you have to apply for a modification, and this process can be daunting. Lenders do not always follow the rules, and when they fail to do so your entire modification can be put in jeopardy. Here are three of the most common ways a mortgage lender violates modification laws:

•         Failing to process your paperwork timely. If you are not diligent, the lender or servicer may push your case to bottom of the pile, and this hurts you because while you are waiting on final modification approval you are still bound by the original terms of your mortgage loan. All too often a borrower is advised to suspend payments because the paperwork will be completed before the next payment is due, but when the paperwork gets lost in the shuffle the only person who suffers is the borrower.

•         Repeatedly requesting resubmission of documents from the homeowner, which also slows down the process.

•         Advising a borrower they do not qualify for a modification because their loan is not in default. The simple truth is that you do not have to be behind on payments in order to have your mortgage loan modified.

The best way to combat these problems is to have a skilled attorney negotiate on your behalf. We stay on top of your application for you, and make sure all documents sent to the lender are tracked for receipt. That way when the lender claims to not have received what is necessary to process your application, we can point to the delivery date and method of delivery. We also make every effort to negotiate terms that fit your budget, on a timeline that makes sense. For help getting a mortgage modification today, call our office.

For more information about how a mortgage loan modification can help you, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

What Happens If I Just Bought A Car And Need To File Bankruptcy?

Most people who are not able to pay their bills typically don’t go out and make big purchases. But maybe it is the big purchases that caused financial distress, or maybe you made a once in a lifetime buy just before your company downsized, leaving you unable to make the payments. There are very few certainties in life, and when it comes to money and how far you can make it stretch, not everything is within your control. Emergencies come up, jobs are lost, people get divorced, and illness can strike at any time. So if you have just financed a major purchase and are now facing a situation that does not allow you to pay for the item, you have to consider how bankruptcy can help.

But what will the bankruptcy Court think if you come into a case just after having taken on a large debt, like a car loan? This can be a questionable circumstance, but it will not prevent you from receiving a bankruptcy discharge. Here are some things to know if this is one of the facts of your case:

•         After your case is filed, and you sit down in front of the Trustee at your 341 hearing, you will be asked some questions about your debts. One of those questions will be whether you have taken on any debt with the intent to not make repayment. It is perfectly fine to answer this question by explaining that you have not incurred any debt with the intent not to repay it, and that the cause of your bankruptcy is job loss, a medical emergency, or whatever happens to be the cause.

•         Some creditors will try and discredit you if you have just taken out a loan with them, and immediately filed bankruptcy. If you intend to reaffirm that debt though, you should not worry about these types of allegations.

When we work with you to come up with a solution to your debt problems, we take into consideration all of the factors unique to your case. This is so that you are aware of all the possible outcomes, and are prepared for what may come. If you have questions about bankruptcy, even with extraordinary circumstances, we can help.

For more information about bankruptcy, contact us today at www.law-ri.com. We will help you come up with solutions that work for your family, and have multiple locations where we schedule appointments so you can make a choice that is convenient for you.

Three Major Events In Your Bankruptcy Case

Making the decision to file bankruptcy is a hard one, and it is even harder if you do not know what to expect. Having some idea of what is involved in filing a case can make it easier to decide if bankruptcy is the answer for you. From start to finish there are things that come up along the way, and when you are prepared for what is coming you can feel better about your decision and not worry about an unknown event.

Three major events that will take place in your bankruptcy case are:

•         Preparation: this phase of your case is the time where you will need to gather all of your income and debt information, and get it organized so it makes sense. Many times when people are in over their heads financially they let the bills pile up, without even knowing the balance or payment required. But when you prepare to file bankruptcy you will need to know what you owe, and going through that stack of bills is the best way to get accurate figures for your attorney. It is also a good idea to keep copies of the past 6 months of your paystubs, as well as a few years’ worth of tax returns. If you own your home, or own a car, you will need to take a copy of the deed to your house and all car titles to your attorney when you discuss your filing.

•         Filing: once you have all of your documents lined out, your attorney will enter the data on your petition and file your case. A short time after your case is filed you will be required to attend an initial meeting of creditors, referred to as the 341 meeting. The Trustee assigned to your case will be present, and a few of your lenders may also appear. The meeting is informal and is the time you will answer questions about your debts and what caused you to file bankruptcy. Your attorney will prepare you for this hearing, so you will be ready to give answers without being nervous.

•         Discharge: this is the goal of bankruptcy, and it is the entry in your case that means your debts are no longer due. In a Chapter 7 case the discharge is entered in about 3 to 6 months after filing, and in a Chapter 13 it can take up to 5 years.

We know it sounds like a lot to file bankruptcy, but the benefits are worth the work. And we don’t let you show up to Court without the information you need for a hearing, because we know how important it is to feel confident that the decision you made is the right decision. If you have more bills than you have money, call us to discuss how bankruptcy can help.

If you have more questions about bankruptcy, contact us today at www.law-ri.com. We will help you come up with solutions that work for your family, and have multiple locations where we schedule appointments so you can make a choice that is convenient for you.

What Is The Bankruptcy Means Test?

When you file bankruptcy, one of the first steps is to have your attorney perform a required mathematical computation. This computation is referred to as the means test, and was one of the major chances to the Bankruptcy Code when Congress made revisions in 2005. The result of your means test will determine whether you can file a Chapter 7, or a Chapter 13 bankruptcy. The test takes into consideration your total income as well as your total secured debt. For people with more secured debt, in relation to their income, Chapter 7 is a possibility. But if you have any money left over after paying your secured obligations, the law requires you to file a Chapter 13 and put that disposable income towards repayment of at least a portion of your unsecured debt.

The purpose of implementing this test was to require those that can pay some of their unsecured debt to do so when filing bankruptcy. Some additional information that is helpful to know about the means test includes:

•         The income figure is taken by avera

ging your last 6 months of wages, prior to filing a bankruptcy case. This includes all regular wages as well as any bonuses or increases you have received recently.

•         The test includes a demographic specific element as well, meaning different parts of the country have different requirements as to what ratio of secured debt to income will allow you to file a Chapter 7.

Most people prefer to file a Chapter 7, because it is shorter and allows you to discharge all of your unsecured debt. But if the means test result shows that you are only eligible to file a Chapter 13, you will still get the relief you need from overwhelming debt. Both chapters of bankruptcy allow consumer debtors to eliminate debt, or at least significantly reduce the balances owed. If you have questions about how the means test works, or need additional information about how bankruptcy can help you get out of debt, we have answers. Call today to talk with one of our experienced bankruptcy and debt management attorneys, and let us help put you on the road to financial recovery.

If you have more questions about bankruptcy and the means test, contact us today at www.law-ri.com. We will help you get prepared for what comes after we file your case, and have multiple locations where we schedule appointments.

Can I Still Buy A House After I File Bankruptcy?

A lot of people are afraid that if they file bankruptcy they will never be able to take out a loan again. And while we are not trying to advocate taking on unnecessary debt, we do understand that life goes on after bankruptcy ends and that means you have need that have to be met. One of the most important purchases a person or couple can make is their home. If you lost your home prior to filing bankruptcy, or were renting and now want to buy it may have crossed your mind to wonder if you are able to buy a house with a bankruptcy on your record. The answer is yes!

After bankruptcy you are likely to begin receiving all kinds of offers of credit, from special financing offers on cars to special credit card offers. You are able to accept any of these offers, but should be picky about what you do after bankruptcy. If buying a house is your goal, here are some tips:

•         Keep new debt to a minimum, and if you do take on a new loan or credit card try and pay it off in full each month.

•         Come up with a budget that is realistic and give yourself a few months of practice to see if it works. Budgets have a way of going off track, and if you buy a house before knowing what you can afford you might find yourself back in financial trouble.

•         Shop around for a lender that will give you a decent rate and repayment terms that work.

•         Take some time to put some money away in savings, and also for a down payment. The more you are able to save, the more financial security you will have for things like closing costs and repairs.

Bankruptcy is a very helpful financial tool, and your future can be positive. When you take the time to plan what you need, and then take the steps to reach your goals, bankruptcy can help. For more information about how bankruptcy might be right for you, call us today.

For more information about bankruptcy and how it can impact your ability to buy a house, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

Will My Credit Be Ruined If I File Bankruptcy?

One of the biggest concerns we hear from people who are considering filing bankruptcy is how long the case stays on their credit report? As we all know, your credit rating plays a big role in what type of interest rate you can get when you apply for a loan, but it can also impact other things. For instance, did you know that your auto insurance provider might quote you a higher rate if they consider you to have “bad credit”? Or, you might be required to put down a deposit to have utilities turned on if your credit score is considered too low. So the concern over how bankruptcy affects your credit is a valid concern.

It is true that when you file bankruptcy it is marked on your credit. But this does not mean it is the end of the world for you credit-wise, or that you will never again be able to borrow money. In fact, here are some ways your credit can start to improve, even with a bankruptcy:

•         If you reaffirm a debt, the lender will note your account as being paid rather than discharged in bankruptcy.

•         If you make direct payments to a lender, like your mortgage holder in a Chapter 13 case, your house payments will be shown as paid on your credit report.

Filing bankruptcy allows you to get back on your feet quickly, which means you can start making payments on things that you have not been able to pay. When you do this, the lenders take note and pretty soon your payment patterns will begin to appear on your credit. Rather than having an account being reported as past due, you will start to see your accounts be noted that you are paying. Bankruptcy puts you in a position to be able to make your payments by eliminating or reducing the debts you are not able to pay, so you can pay for other things. Your debt to income ratio also drops when some of your debts are eliminated through bankruptcy, and this can help your credit score go up as well. For help with getting back on track financially, call our office today.

If you have more questions about bankruptcy or need help deciding what to do about overwhelming debt, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

How Long Will It Take To Eliminate My Debts If I File Bankruptcy?

When you are looking for ways to help with your budget, it is natural to want to find the quickest way out of debt. There are several debt repayment methods out there, which work well for those that are able to stick to a plan. For instance, there are credit card repayment methods that suggest you pay off the card with the highest rate first and then move on to the next highest rate card. The thought is that once one card is paid off, you take that monthly payment and add it to the monthly payment being made on the next card so that the debt is repaid faster. The theory is that if you do this, you will pay off your debt in a shorter amount of time than if you just paid the minimum on each debt. But what works for your friends or neighbors may not work for you, and in order to make some headway you have to find a plan you can follow.

A good plan to eliminate debt quickly is to file bankruptcy. The general timelines for debt elimination under bankruptcy are:

●          Chapter 7: a Chapter 7 bankruptcy will wipe out all of your unsecured debt. The total time to complete a Chapter 7 case, from start to finish, is about 6 months. This means that the debts discharged in a Chapter 7 case are no longer considered due on the date discharge is entered, between 3 and 6 months after the date your case is filed. And, you do not have to continue paying your debts during the case. This means you get instant financial relief the moment you file a case.

●          Chapter 13: a Chapter 13 bankruptcy case is a reorganization of your debts. In a Chapter 13 you come up with a repayment plan, your creditors can object to what you propose to repay them, and once you come to an agreement about who gets what the Court will confirm your plan. You will make plan payments for the entirety of your Chapter 13 case, which can last up to 5 years. The benefit is that when you file a Chapter 13 case, you get to pay what you can afford to pay, rather than struggling to make ends meet.

For help getting your debts in line, by filing bankruptcy, call our office today. We will look at your case and let you know what type of bankruptcy you can file. Our goal is to help you find a way to solve your money troubles, and start fresh.

If you have more questions about bankruptcy, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

Four Financial Pitfalls And How To Avoid Them

Let’s face it, life is expensive. It costs to do almost anything, including something as small as renting a movie from Redbox or Netflix. With large expenses like house and car payments, and the smaller ones like a daily run to Starbucks, it is easy to see how a budget can quickly spiral out of control and make money tight. If you have a budget, you may be having a hard time sticking to it or it may not be taking into consideration all of your expenditures. When having enough money becomes a problem it is tempting to find a quick fix, but doing so oftentimes makes the problem worse.

Here are four financial pitfalls, and what you can do to avoid them:

•         Taking a pay day loan: the interest rate on these loans is extremely high, making it hard to break the cycle of debt. If you take out a pay day loan, you may end up paying back two or three times the amount borrowed. Most people don’t have this financial ability, and so continue to borrow just to repay. Doing this will cause your total debt to add up quickly, and make it near impossible to repay.

•         Transferring balances from card to card: while this seems like a good idea when the new card offers a lower rate, the only way to make this work is to pay off the balance before the promotional rate expires.

•         Taking equity out of your home: it is tempting to take out a second or even third mortgage on your home in order to come up with some extra cash, but doing so will only add to what you owe on your home and eat up any equity. Without an equity cushion, you will be in an unlikely position to sell your home if the need to do so arises.

•         Paying only the minimum amount due: when all you can pay is the minimum payment, you do keep the lender off your back for collection, but you make little to no headway towards full repayment. If you can pay a little more than the minimum, do so.

The best way to avoid these pitfalls is to stick to a budget. But when that is not possible, you should think about filing bankruptcy. Bankruptcy will put an end to the need to pay back your debt at high rates, and will help to free up your money so you can make your payments without problem.

For help with managing overwhelming debt, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.