It's unfortunate that some of the same people who got mortgages through predatory lenders may now be facing scams to get out of near-foreclosure situations.

The Federal Reserve Board announced some tips for people who are seeking help saving their homes from foreclosure. Unscrupulous solicitors may reach out saying they can help, but it's important to be wary.

One of the biggest red flags is high fees.

"Saving a home from foreclosure requires fast and informed action but the solution doesn't have to be costly," said Federal Reserve Governor Elizabeth A Duke. "It shouldn't hurt to get help."

Here are the Fed's other tips to avoid becoming a victim of a foreclosure avoidance scam:

• Work only with a non-profit HUD-approved counselor. For a list of certified counselors visit www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm or call 877-HUD-1515 (877-483-1515). If the name of the organization you are working with isn't on the list, then switch to one that is.
  
• Don't pay an arm and a leg. Most housing counselors provide no- or low-cost counseling services. You should not have to pay hundreds, or thousands, of dollars for assistance.
  
• Be wary of "guarantees." No one can ensure you good results.
  
• Know what you are signing. Don't let a counselor pressure you into signing paperwork you haven't had a chance to read thoroughly or that you don't understand.
  
• If it sounds too good to be true, it probably is.
  
• If you feel you are a victim of foreclosure fraud, trust your instincts and ask for help. Report suspicious schemes to your state and local consumer protection agencies, which you can find on the Consumer Action Website.

Knowing Your Wants And Needs Helps Home Buyers Identify The Right House To Buy

Before you buy, you should figure out what you want in a home. What are your must-haves and deal-breakers when buying a home?

Creating a home buying wish list can also be a test for your relationship, if you're buying a home with a partner. Learn how to put together an effective list of your needs and wants for buying a home.

What makes a house worth buying? It goes back to the basics: Your wants and needs.

With so many homes for sale, it's easy to sift through hundreds of homes for sale in a particularly area and decide that all of them -- or none of them -- make sense for you.

Understanding more about what you want in a home and what you can't live without will help you make a smarter decision about what house you buy. Here's how to start identifying the difference between what you want in a home and what you can't live without.

You (and your spouse or partner) should each write down everything you want in a home from your school district and your neighborhood of choice, to the location within the neighborhood, the size of the home, its amenities, and even whether the home is a condo, co-op, townhouse or single-family residence. Do you want attached, indoor parking? Write it down. Do you want a home that's a fixer-upper or one that has already been renovated? Write that down, too.

Your next task is to prioritize everything on the list. And, this is where each buyer having his or her own list comes in handy. Your list will be different from your spouse's or partner's list. And even if you have the same items on your wish list, I'm willing to bet that your priorities will be different.

For example, when my husband and I were looking for our first home, we didn't have a car and couldn't conceive of when we would buy one. We were young newlyweds, living on the near north side of Chicago. Chicago has one of the best public transportation networks, and we both worked less than four miles from where we lived. It was easy to take a bus to and from work and often we walked home.

Having a garage didn't even crack the top 10 on our wish list. But having a wood-burning fireplace was in the top slot on my list. (Boy, have I learned a lot in the past 20+ years!)

When we bought the house we live in now, it was five years after our first home purchase and by that time we did have a car. So, having a garage was one of our top priorities. We had also moved from the city to the suburbs, and my husband was taking the train to work. Since we only had one car, finding a house within walking distance to the train station was the top priority on his new wish list because he didn't want to have to buy a second car. Having a great school district and enough space so I could work from home were the top two choices on my wish list.

Once you've prioritized your wish list, it's time to think about what you actually need to live. Your "needs" are items that you can't live without. For example, you may want a 5-bedroom, 4-bath house, but what you really need is a 3-bedroom, 3-bath or even 1 1/2 bath home.

I call this "needs" list your "reality check." Once you and your spouse have each completed your reality check, it's time to prioritize the items on this list as well. Organize the list starting with the most important item on top.

You and your spouse should then combine your individual wish lists and reality checks into one wish list and one reality check. You'll do this by discussing what is most important to each of you, agreeing on what you need, and compromising on the rest. (Hint: If you can't complete this process without having a major falling out, you're probably not ready for the responsibilities of homeownership.)

There are a couple of important lessons to be learned by completing the wish list and reality check, of which learning how to compromise might be the most important.

But nearly of equal value is figuring out that you probably can't afford to buy a home that includes everything on your wish list. (And if you could afford it, you may no longer be able to after the credit crisis of 2008 and 2009, and the new stricter lending requirements.)

In the last several years buyers were able to buy homes that might have included everything on their wish list and more, however, they were able to buy only by using exotic mortgages (like pay-option ARMs) that harmed them down the line. When you start shopping around for your financing be sure you're looking at homes you can afford with a standard 30-year mortgage. If the homes you're looking at will pinch your wallet so much that you'll have to dramatically alter your lifestyle, it's probably best to take another look at your wish list and reality check and find something more affordable.

With luck, you can hopefully afford to buy everything you need, and a few things you want while staying within a budget you can live with for the long term.

Remember, you can change almost everything about a house except its location (moving the house notwithstanding). Provided you have the available square footage and financial resources, garages and additions can be built and built out; bathrooms and kitchens can be renovated; basements and attics can be tricked out; closets can be organized.

Discussing what you want and need is an excellent way to begin the process of identifying a suitable home. It turns you from an armchair home buyer into one who is ready, willing, and able to engage in the process. Knowing the difference between what you want and need will save you from looking at inappropriate properties that you can't afford, and will endear you to your agent -- who can help you find a great deal in what will likely be seen years from now as the ultimate buyer's market.

Ilyce Glink’s Money Makeover

May 9, 2009

With the credit crisis continuing and the financial markets in a state of flux, consumers have a lot of questions about getting their own financial house in order.

To accommodate a growing number of requests, Think Glink is planning to host an event at a central location within the Atlanta metropolitan area that gives people a chance to ask questions about real estate and personal finance, including debt, credit, investments and mortgage finance.

It's a means for Ilyce to meet face-to-face with the large audience she has developed from her top-rated Sunday morning WSB radio talk show and her syndicated column in the Marietta paper. But it’s also an opportunity for key Atlanta financial and real estate companies to reach out and market their services face-to-face with an audience that likely fits their target consumer.

The first part of the event will run from 8:30a - 12:30p on May 9, 2009 and will include a short welcome speech given by Ilyce plus two panel discussions featuring local experts and sponsors. There will also be time for attendees to have some one-on-one time with sponsors at their own private tables.

In the second part of the day, we will give our attendees an option to buy lunch, hear Ilyce’s keynote address and another panel discussion, and then spend a few more minutes with our sponsors. The lunch part will wrap up around 2:00pm or so. We're planning for a good crowd!

The event is drawing a significant amount of interest from prospective sponsors. WSB will be the media sponsor. The station will air a large number of promos for the events during the week, over the weekend and at night.

Schedule of Events

8:30a Registration

9:00a Welcome by Ilyce Glink

9:15a - 10:30a Panel Discussion #1

10:30a - 10:45a Break

10:45a - 12:00p Panel Discussion #2

12:00p - 12:15p Wrap up and opportunity to meet with sponsors one-on-one

12:30p – 2:00p Lunch and Panel Discussion #3

2:30p Event Wraps

For more details or to secure your sponsorship package, contact Think Glink at (847) 835-3450.

The Housing Market, First Time Home Buyer Tax Credit And Refinancing

What do you think about the government's new Home Affordability and Stability Plan? Do you think it will affect the housing market? Or do you wonder what will happen to all the homes in foreclosure? Mold could be an issue. First time home buyers will get a tax credit - but what does the plan offer to current homeowners who want to refinance their undervalued home?

Rick Santelli of CNBC is up in arms. But he's not the only one.

His recent rant about how no one wants to pay his neighbor's mortgage is echoed in the sentiments of Americans worried about their own jobs (or lack thereof), shrinking 401(k) plans, and ballooning debt payments.

Last week, I wrote about the government's new Home Affordability and Stability Plan. Will it help the right people? Will it help at all? Here are some reader's reactions (edited, in some cases, for clarity and length).

Comment: I think that it is very doubtful that this very minimal effort to boost our housing market will have enough effect to make a difference. It does nothing to entice anyone other than first time buyers, who are a small percentage of buyers in the market place. And I just learned from your article that they must also remain in the house for three years! Is our government stupid? This will be a negative condition as it will mean that all those homes will not resale for at least 3 years. What does this do to stimulate the real estate/housing market?

I think there should be some substantial incentives for everyone who is a potential buyer! Repeal the capital gains tax, at least for a period of time. We desperately need the [real estate] investors to get back in the game! If the housing market takes years to turn around, I don't see how any other aspects of business can expect to prosper.

It is a big domino effect when a home sells: You employ the Realtor (or two), appraiser, closing attorney, surveyor, home inspector, termite company, in many cases a home warranty company, and contractors who are hired to do the repairs noted on the home inspection report. It is amazing to me that U.S. Sen. Johnny Isakson's $15,000 tax-credit proposal did not pass. That would have been something that would really encourage all buyers to make a purchase.

It occurred to me that these foreclosed homes that are sitting with no heat or air conditioning will inevitably develop problems with mold. What will we do then? Hire companies with taxpayers' money to remove the mold (this is very costly)? Or hire someone to tear them down?

The way our president and Congress are handling this is very disappointing, and really a joke!

Ilyce: The writer signed herself as "a self-employed (unemployed) Realtor," which is unfortunately how many real estate agents feel at the moment. It's a great point about the foreclosures sitting vacant and possibly growing mold. In many municipalities, lenders and servicers are being fined if they do not maintain these properties and keep them from becoming a blight on the neighborhood.

Comment: You stated in your article that the $8,000 tax credit for purchasing a primary residence was only for first-time homebuyers. The person that intended on buying a home was a transferee (who had a home to sell). The fact that she has a home already makes her not a first-time home buyer. Therefore, she does not get the $8,000!

Ilyce: This is true. The $8,000 tax credit is only for first-time buyers. The woman in question currently owns a home in Atlanta and would not be eligible. Her question came to me when the Senate was considering a tax credit of $15,000 and available to all home buyers, not just first-time buyers.

Personally, I'd like to have seen every buyer qualify for the tax credit, even at the $8,000 level. Also, it appears that if you buy a home in 2008 and opt to take the tax credit on your 2008 return, you will be able to get the full $8,000 tax credit, and not the $7,500 we reported earlier. New guidance just released from the IRS has cleared up the issue of the missing $500.

Comment: It is so nice to hear and read about the nice credits for first-time home buyers, and now help for folks in foreclosure, and more unemployment benefits, etc. What about us whose homes have been devalued because of the foreclosures? There doesn't seem to be any benefits for those of us who are still keeping up our payments and paying the interest at the higher valued price.

Ilyce: The Home Affordability and Stability Plan has changed the rules for refinancing. You'll be allowed to refinance at lower rates even if your first mortgage is 105 percent of the value of your home. (If you have a second mortgage, you'll have to get the home equity lender to sign a subordination agreement). You'll be allowed to do this even if you pay your mortgage on time, and my understanding is that there will be no costs to the refinance.

But you're right. These loans will not generally write down the principal balance owed on the loan (although there are incentives for lenders to make these loans affordable and keep them at a level so that homeowners will pay them on time for years). They're designed to help out people who might have had the equity in their property evaporate as the valuations fell.

Comment: What about us folks who have been struggling for at least 10 years to keep our heads above water. We watch what we spend, but sometimes we screw up and buy more than we really need. We work hard on our credit scores to keep them high.

Now, we have to work even harder (I don't know if I can work 20 hours daily), to pay for the people who didn't watch their spending (i.e., The Jones', and our own government). Where is our help? Do we just lie down and start using the government like everyone else? Even with all the technology we have today to keep people alive longer, I really feel over the next 10 years much younger people will start dying. Do you have any idea on what we should do?

Ilyce: There's no question that some people who don't deserve the assistance will get thrown a lifeline with the Homeowner Affordability and Stability Plan. But there could be a massive public benefit to helping a larger number of people more quickly. If you help markets find a floor by simultaneously helping people find jobs and giving them a way to spend less on their mortgage each month (by lowering the interest rate), all neighborhoods would benefit. Right now, it's just theory and a few incredibly complex math formulas.

Unfortunately, I don't know how you separate the milk from the cream when millions of loans are involved.

Comment: Regarding the first-time buyer home buyer tax credit. When you talk about dollar-for-dollar reduction in the taxes you owe, are you referring to property taxes or income taxes?

Ilyce: According to the White House, the refundable tax credit is taken on your federal income tax returns, and you will receive the money even if you don't pay $8,000 in taxes. If you owe $10,000 in federal income taxes and are eligible for the first-time home buyer tax credit, you would only owe the IRS $2,000.

Andy, our expert handyman was just named HANDYMAN OF THE YEAR on Angie's List! Congratulations to him, and lucky you because you can view all of his great advice at http://www.youtube.com/user/ExpertRealEstateTips. Or click below to watch his latest step-by-step video on brass polishing.

Whether you are getting your house ready to sell or just want to spruce it up, consider polishing your brass hardware as an easy do it yourself home improvement project. Polishing your brass doorknobs gives your home a new look. Easy DIY projects like this will help you save money and sell your house faster.