The second most asked question is “How soon does the foreclosure go on my credit report?”. This depends on the lender but in the vast majority of cases, as soon as the homeowner is 90 days late (30 days in some states), the foreclosure info is filed with the credit reporting agencies. It will not be “reversed” by a short sale or a deed in lieu of foreclosure unless negotiated by the homeowner, and often that doesn’t work.

So with the foreclosure question, the homeowner’s credit score is first decreased by his late payments. Usually, he is also late on other bills because of his financial crisis and has additional late payments, collections, or even judgments that all lower his credit score. So if he had his credit score of 680 on a specific date before he started his personal financial decline, after he has been served with his foreclosure notice or even after the foreclosure is completed; his new score could be 420 or lower. He is usually shocked and dismayed, but the real problem is how much more interest the lenders want because of his low credit score. For example, an auto loan to an “A+’ credit customer could be 0% interest while for a “D” credit customer, it could be 11% or higher. What does that actually mean? It means that the “D” credit individual will pay $7,500 to $13,000 more for the same car as the “A” credit buyer! The collateral for the loan is the same car, so the “D” credit person is unfairly penalized for his credit situation.

The foreclosure’s actual point impact on an individual’s credit report is estimated to be from 125 to 175 points. The bigger impact is from the late payments on other bills which quickly mount up. The net effect is generally considered to be about a 240 point decline counting his late mortgage payments. Ironically, the lower your credit report to start, the less the impact of additional late payments, and if you get into the 400′s, it’s really hard to get much lower without almost trying to hurt yourself. Many of the items on any credit report can be removed over time. It requires persistence and it’s estimated that 30% of all items on credit reports are incorrect and can be removed just by an inquiry or showing a paid invoice. Also the credit score reduction for the foreclosure is reduced as time goes on, until it settles at a minimal deduction (50 to 75 points) after a few years.

It is absolutely untrue that once you have had a foreclosure you can never buy a home again, as we see people buying a new home within a year of losing theirs to foreclosure. There are even homeowners who legally buy homes within 30 days of their foreclosure using legal techniques with no cash and no credit.

Foreclosure victims, who want to do conventional financing in the future, will have to pay a higher interest rate (approximately 1 and a half to 2%) unless their down payment could be 10% to 20% of the purchase price. This sizable down payment can often be obtained from friends or family members and carried as a second mortgage or second deed of trust on the property.

I am often asked if doing a “Deed in Lieu of Foreclosure” or a “Short Sale” with the lender reports the same as a foreclosure. Unfortunately, depending on how the lender reports your foreclosure, it could stay on your report even if the lender accepts your deed to resolve the foreclosure. The foreclosure action does not have to be filed in the courts to be considered a “foreclosure” by the lender. If your lender accepts a “Deed in Lieu Of Foreclosure” or a “Short Sale, always them ask for a letter explaining they have accepted your deed in exchange for your home, and that they will retract or not put a foreclosure notification in your credit record. If they tell you they have to, it’s not true, ask for a Supervisor until you get your letter.

The first thing that you may not have considered is whether your home is capable of being a business office. Do you have a room that can be set up for a business office, or will it have to be shared with your bedroom or in the living room or part of the dining room. Having the appropriate amount of room within your house can be a big problem as your business begins to flourish more each year. Will you have room to add new equipment or filing cabinets to store all of the important information that you will need to retain? If your home business begins to have a considerable amount of paperwork associated with you, you may want to consider keeping only the most important and widely used work at home and store the others in an off-site storage unit. If the paperwork is something that you may need occasionally, then you should consider that as you look for a site. You do not want to have to wait for two weeks while the site manager looks for your boxes.

Will you have room for expansion in your house if your company begins to grow? Many people find that after a few years the amount of equipment and storage space no longer work well together. At that time they need to consider either moving to a larger home or renting a building that can be used as an office. Will you be able to afford the rent on the new office during all seasons? You must consider whether or not the new office has room for expansion also. Some originally home based businesses grow to be a multi-million dollar company and you will need to consider whether you will need to hire new employees, take on a business partner or be run as a family based business. Will your new office have room for your new employees and their office equipment?

Storage and office space can be a problem if you do not prepare for it early on. Keep a journal or log of what you think you will do if your company continues to expand and how you will manage the office once you have several employees. You may decide not to use these ideas when the time comes to place them into action, but they can help to give you some direction for the future.

I have often wondered why many look at being poor or rich in terms of the financial status of individuals and fail to recognize the inherent principles that men must have to be viewed as such. When the rich refuse to extend their wealth to all mankind, can they possibly be called or regarded as being rich? I think such people are lacking true meanings in their lives. When the poor on the other hand do not recognize their position as to be humble, can they possibly be viewed as being poor?

In the first case the rich who finds it hard or things it impossible to share with the poor or other people is in my mind a very poor person indeed, while the poor who fails to recognize his/her position in my mind is not to be regarded as a poor person but a self-centered one. We all can be poor or rich depending on what we do with our situations and how we feel about our selves.

Our moral values and understanding play a very vital role in the way we act, see, and connect with our immediate and broad environment. Some would say they have worked for their wealth, but fail to realize that those who patronize them hold the key to their success. The poor on the other hand would be the man or woman who says their problem is more severe or worth consideration before those of others; that is not a poor man, but a selfish one. Theses kinds of people would probably remain where they are for a long time until they come to that understanding.

Are we rich or poor? That is the millionaire question that we alone can answer our selves.