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Getting Personal: Mortgage mystery and a 529 for baby

Getting Personal

This week, we find out whether or not it is possible to save money while in graduate school, how to handle phone calls from a mysterious lender claiming to own your mortgage, and how to choose a 529 plan for your newborn.

Plus, here is the link Chris Farrell mentioned during the broadcast: Saving for College.

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The gentleman who called regarding his 2nd mortgage on the 5/22/2011 broadcast was given incorrect advice. The 2nd mortgage holder/lender has the right to foreclose on the property, just the the 1st mortgage holder/lender does. In ignoring the 2nd mortgage, he is jeopardizing his ability to qualify for a Loan Modification. The package he received from his 2nd mortgage holder was not a scam, but a financial package he needs to complete in order to qualify for a loan modification. It is obvious that the person that he was dealing with at the 1st mortgage company was not aware or privy to the fact that the 2nd mortgage has been sold or transferred to another company. That does not mean that the contact he received from the 2nd mortgage is a scam. He should immediately contact the 2nd mortgage company directly, and explain that he recently modified his 1st mortgage. It was not a scam that the 2nd mortgage holder sent him a package. If he fails to do that, he is in jeopardy of foreclosure action being taken by the 2nd mortgage, or the 2nd mortgage has the right to sue him for their loan which can result in a judgment and his wages garnished. Please, please, please, do not advise your listeners to ignore their 2nd mortgages or give the impression that the 2nd mortgage is a scam.

The gentleman who called regarding his 2nd mortgage on the 5/22/2011 broadcast was given incorrect advice. The 2nd mortgage holder/lender has the right to foreclose on the property, just the the 1st mortgage holder/lender does. In ignoring the 2nd mortgage, he is jeopardizing his ability to qualify for a Loan Modification. The package he received from his 2nd mortgage holder was not a scam, but a financial package he needs to complete in order to qualify for a loan modification. It is obvious that the person that he was dealing with at the 1st mortgage company was not aware or privy to the fact that the 2nd mortgage has been sold or transferred to another company. That does not mean that the contact he received from the 2nd mortgage is a scam. He should immediately contact the 2nd mortgage company directly, and explain that he recently modified his 1st mortgage. It was not a scam that the 2nd mortgage holder sent him a package. If he fails to do that, he is in jeopardy of foreclosure action being taken by the 2nd mortgage, or the 2nd mortgage has the right to sue him for their loan which can result in a judgment and his wages garnished. Please, please, please, do not advise your listeners to ignore their 2nd mortgages or give the impression that the 2nd mortgage is a scam.

Could private lenders be pushing regular rate loans on naive students and calling them "student loans" for the special protected status that educational loans have under the law? Sounds like high profits at low risk to me!

This is information for Cherry who asked about 529 plans. There are a couple of 529 plans out there. Some are pre-paid, which means you are making monthly, semiannual, or annual payments. When your child turns 18, tuition is guaranteed...as long as you go to that state university system (i.e. California). If your child goes out of state, then the fund will pay a weighted average tuition...which may or may not completely over the other university's tuition. Also all these state 529 plans are not run by the state but fund manager companies like Wellington, Fidelity, Vanguard, etc. Don't limit yourself to state plans. I like Vanguard, they're the low-cost leader. (Full disclosure, I worked for Vanguard a few years back). Tess, Chris - love the show. Been listening to marketplace since I was 10; I'm in my mid 30's now!
-pete

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