Bankruptcy & Foreclosures

Are you in a lot of debt? If so, you are not going to be relieved of this by osmosis. Instead, you are going to have to work hard to achieve success in this area. One of the best ways to get started is by setting debt relief goals. These goals do not have to be extensive, and they should not be impossible to reach. Instead, start out small with short term goals. Additionally, you may want to set one long term goal, such as being debt free within a certain period of time.

Setting debt relief goals is difficult for some people. What is the reason for this? Well, there are two that are quite common:

1. Some consumers do not want to set goals attached to getting out of debt because they are afraid that they will fail. This is very common because everybody knows that paying down debt is difficult. Not only do you have to keep track of your debt, day in and day out, but you must also change the way you live in many cases. Are you willing to make these sacrifices in order to reach all of your debt related goals?

2. Unfortunately, many do not really want to get out of debt. As noted above, you must work hard and make sacrifices if you are going to eventually rid of your debt and the problems that go along with it. Are you willing to give up nice dinners and nights out on the town in order to pay down your debt? Many people won’t give up their current lifestyle, and in turn find themselves in more debt as time goes by.

It is one thing to set debt relief goals, but another to achieve success. Are you willing to do whatever it takes to pay down your debt and reach all your goals?

According to government-sponsored loan buyer Freddie Mac, mortgage rates have finally ended their five-week descent after this latest rate cut to the federal funds rate.

Freddie Mac reports that 15-year fixed-rate loans average 5.17% opposed to a 6.06% average this time last year. Believe it or not, this is actually higher than it was last week (4.95%).
While lower rates excite consumers, it is by no means a cure-all. While rates plummet, banks become less enthusiastic to lend money (as their profits are being lowered). In addition overseas investors shy away from the dollar, which not only lowers the value of the dollar, but it also causes inflation.

What makes this economic turn of events even more interesting is that it comes during primary election time which means these issues will inevitably determine who will be responsible for running the nation for the next four years. Recent surveys prove that economy concerns has surpassed the war in Iraq as the main focal point on the minds of American voters.

In addition, many feel that the Republican led government is heavily responsible for this economic deterioration. Democratic candidates hope that slow job creation and lagging wages during the Bush Administration’s term will spur Americans to vote for change in this upcoming election.

The market received a wealth of economic information on the first days of February which unfortunately shows quite a mixed state of affairs. Despite the economy’s record-setting run of 52 consecutive months of job creation came to a screeching halt, the latest numbers say that domestic manufacturing in January looked surprisingly well. Since job growth and recession cannot occur at the same time, it’s looking like many initial fears of a long, drawn out recession may be a myth after all. We’ll keep a close watch and keep you posted as well.

Faced with increased talk of economic recession, the Fed made its second interest-rate cut this week today by slashing short-term rates by a half-percentage point.

This slash affects the federal funds rate – which is responsible for determining interest that consumers pay on their credit cards, home equity, and auto loans. This most recent rate cut pulled the rate down to 3.0% from 3.5%.

To date the Fed has never lowered the federal funds rate below 1 percent although word from many analysts is that a series of half-percentage point rate cuts (like the one that occurred today) would get rates down to such a low level in a matter of months.

This is good news to you and I as the federal funds rate slash will show up in the interest we pay on just about every loan, however, this trend puts a lot of pressure on the Federal Reserve. At 3.5% the rate is now less than inflation over the past year, meaning that the interest rate is in actuality a negative.

Despite these cuts, the White House continues to deny that the situation is as serious as it appears claiming that a report on fourth-quarter gross domestic product released earlier today does not affect its outlook.

The Department of Commerce tells a slightly different tale in their report showing the economy grew at an annual rate of a mere 0.6% from October to December (opposed to a annual growth rate of 4.9% over the three months prior).

Meanwhile the economic stimulus plan marches on amidst tax season. These are days where consumers benefit by tax rebates and rate cuts but must keep in mind that these incentives are being implemented in effort to boost spending- the only surefire measure to counteract a recession (whether the White House wants to admit it or not).