The process is supposed to be simple. If you have a securitized mortgage, you make your payments to a servicing company. The servicing company is granted the authority by the certificate holder of the loan to collect the payments and enforce the terms of the loan. But what if that servicer never actually had the right to collect? Even if they had the right, what if they covered all of your missed payments to the certificate holder and its trust that owns your mortgage? If this were the case, your loan is current. Would the servicing company have the right to foreclose on your loan that is current with the certificate holder/trust?

In most cases the servicers are making the mortgage payment to the certificate holders (the owners of the debt), whether the borrower makes their payment or not. This means that the certificate holders of the loan are getting paid, therefore there is no default giving them a reason to foreclose. This certainly explains why you very rarely see a declaration by the certificate holders or their trusts claiming a default! The servicer makes the payments and collects their service fees until they decide to foreclose, despite the fact that the certified holder of the debt never experiences a default. Once they foreclose on the loan, they can collect even more fees. Pretty sweet racket for the servicers, right? Read More→

When stock markets are volatile, investors (rightly) get nervous. After all, many people have most of their wealth in the stock market. If the stock market goes down, then they see their wealth shrinking…and for people close to retirement, this is a scary prospect indeed. But it doesn’t have to be this way. With Real Estate IRAs, many people learn that retirement income doesn’t have to depend on the quality of the Dow Jones Industrial Average. Instead, retirement income can depend on your strength as an investor, and the wisdom it takes to know what true diversification really is.

And just what is that “diversification” we’re talking about? Some people will tell you that investing with diversification means having the right mix of stocks and bonds, of having stocks split up into small cap, medium cap, and large cap equities. But all that really means is that you’re invested in two different investment categories, all the while ignoring all of the very real possibilities for retirement income that are out there.

If you’re sick of feeling nervous every time that stock ticker heads into the red, then it’s time to broaden your horizons as a wise retirement investor and look into what diversification really means. Read More→