Jay Seaton, area president of Consumer Credit Counseling of North East Ohio had these cautionary words for home owners or prospective home owners:
-1. No matter what debt instrument you start out with make certain that it can be refinanced as a traditional 30-year mortgage. And if you have not yet bought a house, you should consider these mortgages the goal standard; they will provide you with security: you know exactly how much you will owe and when.
"Your goal should be to own your house free and clear before you retire, and a 30-year fixed mortgage is the best way of reaching this goal," Mr. Seaton said. "It even gives you a chance to make extra payments whenever that becomes possible for you."
-2. We are serenaded by non-stop "buy signals" - No money for a down payment! Poor credit, or no credit? You can still move into a new home tomorrow if you act today!" But truth be known, nothing will happen if you do not act on that great deal today; an even better bargain might come along next week.
"Sometimes, it is best to wait," Mr. Seaton said. "If you cannot even make an initial down payment, this might not be the time for you to buy."
HOW DO YOU KNOW IF YOU ARE IN TROUBLE?
The warning signs of impending financial doom could hardly be described as speaking in a soft whisper. They virtually blare out at you, staring you in the face. You cannot make minimum payments on your credit cards, or can only manage these payments by doing some juggling. Making your mortgage payments also demands financial slight of hand.
HOW CAN YOU NAVIGATE YOUR WAY AROUND DEBT?
A consumer credit counselor can serve as an intermediary between you and your creditors, arranging a payment plan you can handle. And increasingly more people are going through this process. The number of clients who sought help from Consumer Credit Counseling Service in Ohio increased by 20% just between 2005 and 2006.
"As the oldest consumer credit counseling agency in the country, we have a reputation," Mr. Seaton said. "And we do not just tell people 'O.K. follow this plan and see us in three years when you are debt free. We work with people. The results speak for themselves. Over 60 per cent of our clients complete our program (becoming debt free). Or, they simply pay off their debts on their own."
