IndyMac Bank Failure- What do I do?

The recent bank failure of IndyMac bank is catching a lot of people by surprise. I was getting ready to write out an extensive blog today due to many concerns of my clients, Then I happen to read a great article written by Diane Kennedy, I couldn’t say it any better so I have posted below. Make sure you visit her it is great resource for tax tips.


Carlos Samaniego

Article below:

Hi Friend:

There was a huge wake-up call for Richard & I personally and our businesses this past weekend.   I

New Website

It has been a while since I last posted her on my blog.

I had been so busy on a project that is now helping almost 100 people all over the country earn more income part-time from home, without having to get a 2nd job. It has been a huge success, I am planning on sharing it with all my clients and/or anyone who ask for more information. You can go to to request a free DVD from me 🙂

Your friend,
Carlos Samaniego
Credit Restoration Expert

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Avoiding Financial Setbacks #5: Create A Second Income

One way to help struggling homeowners is to create more income. I have seen that the average home mortgage increase from adjusting home mortgages is about $300-$700 a month.

So question you may ask, is it better to find out how to create some additional income or lose your home to foreclosure or face bankruptcy.

Here is a great article I recently read below:

If you like some more ideas about creating a 2nd income email our offices at Carlos@CarlosSamaniego and put 2nd income in the subject line. My wife Liz and I are coaching people how to start there own home-business/Internet Business. We be happy to help you in anyway.

Carlos Samaniego
May 13, 2008

Banks Suspending Home Equity Lines of Credit

If you have a Home Equity line, you need to read this now!

Banks Suspending Home Equity Lines of Credit

By Aleksandra Todorova
April 24, 2008

TERI GRUBAR, a 46-year-old small-business owner in Minneapolis, isn’t the type to pay a bill late or bounce a check. So when the owner of the tree service she had hired to spruce up her yard rang her bell earlier this month, angrily waiving a letter stating that her $3,000 check had bounced, she knew something was wrong.

A call to Citibank threw her into further disbelief: Her home equity line of credit, or HELOC, which had $20,000 in it for the occasional home repair or cash emergency, had been closed. It wasn’t her fault. As the bank explained in a notice she received a few days later, her account was suspended because her home value had “significantly declined.”

“This has affected me financially and emotionally,” she says. “I’m self-employed and sometimes it can be a couple of months before I receive payments. Now I’ve got nothing to fall back on.”

With house values plunging across the country, hundreds of thousands of homeowners find themselves in Grubar’s situation. Many large banks, including Bank of America (BAC1), Citigroup’s (C2) Citibank, J.P. Morgan Chase (JPM3), Countrywide (CFC4) and Washington Mutual (WM5), have confirmed that they’re reviewing HELOCs and are either decreasing available lines or closing them altogether. To determine which HELOCs to suspend, lenders are using monitoring systems that flag accounts in areas where home values have dropped significantly. Citibank and Washington Mutual say they may also consider individual borrowers’ payment history
and credit.

Driving this trend is the increased risk lenders face as home prices plummet and delinquencies rise, says Keith Gumbinger, vice president of mortgage research firm HSH Associates. “When you lend money to someone against the equity in their home, you are doing so on a secured basis,” he explains. “If they owe in excess of the value of the home, you could never recover what you’re owed in the event of a default.”

This new risk-management measure, however, is hurting consumers in unexpected ways. Barbara Clark, a 57-year-old homeowner in Fort Pierce, Fla., was shocked to discover that shortly after Citibank suspended her $80,000 Citibank HELOC, her credit reports from bureaus Equifax and TransUnion listed the account as “derogatory.” Clark, who monitors her credit religiously since she’s about to start shopping for a new mortgage, immediately disputed the item. Equifax corrected the error, but things have only gotten worse with TransUnion, which changed the account status to “collection/chargeoff.”

“I’ve been working really hard trying to resolve this, and the longer I’ve worked the worse it’s gotten,” Clark says.

In a written statement, TransUnion said the credit reporting companies collect information furnished by lenders and if a lender reports the account in a “manner that is derogatory in nature, then that, in turn, is how the item will appear on the report.” Citibank declined to comment on specific customer accounts, citing privacy concerns, but said that “as we report it, the change is not a derogatory item.” The bank advises customers to use the original notification letter in the event the bureaus misinterpret the information.

While there’s nothing you can do to prevent a HELOC suspension, there are ways to avoid such disastrous consequences. Here’s how to face one well-prepared.

Monitor your credit

If reported to the credit bureaus correctly, closing or decreasing a HELOC should have no effect on your credit score whatsoever, says John Ulzheimer, president of Educational Services. Unlike credit cards, HELOCs aren’t included in your overall credit utilization ratio, which is based on the percentage of the total available credit that you’ve used. However, if the account is reported incorrectly, things get a lot more complicated.

The problem is that credit-monitoring services may interpret the data they receive from lenders differently. When Clark initially pulled her credit report through, the account was listed as “derogatory.” But when she pulled her reports from