When a Mortgage Overwhelms, Change the Terms

Recently, I became engaged and we have two homes between us...two mortgage payments. My fiance has an adjustable rate mortgage that is scheduled to go up in July.

He called two weeks ago to refinance or get an extension and they told him that he no longer has 20% down and they couldn't help him get a low rate like he had since his home is now appraising $45,000 less than it did two years ago!

His home was valued at $155 and he paid it down to $112,000. Pretty good... except now his home is only valued at $114,000! After paying $80,000 in interest over the past seven years and $40,000 in principal he now only has $2,000 paid off! Well how do you like that! They told him he would get a higher interest rate and have to start paying PMI again! Our mortgage payment is going to go up in two months about $300.

I called my mortgage provider in advance of the impending problem/situation to see if we could work something out, so that we don't suffer and can keep paying both mortgage payments and they told me I wasn't late yet so therefore they were not willing to speak with me.

Basically, screw my credit so in a couple of years they will get more money from me in other avenues. My credit card rates go up, my credit score goes down so that next time around I will be penalized with higher interest rates on my mortgage, etc... etc...

The cycle needs to stop.

DeAnna of MI 11:08AM May 19, 2008

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zqlnktu xjnbwlrgz of AL 11:22PM March 16, 2008

I've done some investigating on my own, setting all ego aside! Not fun but maybe it will help people who, like me were scratching thier heads going, this just doesn't make sense. What gives?

When we first knew we were going to have troubles, we phoned our lender. They said, "No can help pal, until you fall behind at least - at least, 3 payments. "

So, o.k. if you insist...we did. A myriad of options became available but it does go on your credit report which leads me to this next part.

After you skip the payments you save your mortgage, but all of the sudden your C.C. will lock, even if you've made regular payments and DID NOT want to fall behind on your mortgage. So, it's a bit of a catch 22 but leads to just this...

My husband is a vet. His own government official took him outside and said, "FILE BANCRUPTCY! You have no idea how many people are getting rich off of utilizing the bancruptcy law and you actually need it. Most of the people who use it, don't and file every seven years. They live life styles you and I will never see."

We haven't even begun to see all of the numbers yet in foreclosures. The banks that will not work with you, well let's just say will be holding the bag with unwanted properties. They're probably overworked anyway with the latest in mortgage issues, accounting for some of the attitude, but still.

If you can refinance, take your business somewhere else! If it's feasible. If not cut the loss and sell or do a "Deed in Lieu of Foreclosure." The house has to be on the market for at least 6 months.

Our bank actually told us we couldn't do that, but turns out that was a misgiving like many things. That's exactly what we're doing. They just didn't want the property.

Elleise of IL 3:55PM March 01, 2008

Wow! I wish I would have known about 995hope.org before I paid someone $1000 to fix my problem. I am somewhat educated in mortgages and the terms and I couldn't get them to off me a loan mod either - only a VERY expensive repayment plan. Amazingly, though, having someone else call at least got me a forbearance - they want $8000 down and then in after four months of timely payments, we'll talk again. I'm not sure what to think about this - is that really a forbearance anyway?? I guess is does get me out of my property sale date in March - no guarantees after four months and $30,000!! (My house payment is $2500 a month, but they want me to pay $3000 for four months.) I think that several people are in my shoes - they can afford their current mortgage, but they can't afford making up taxes that the mortgage company paid for them, or a few payments that they got behind 2 years ago - along with all of the interest, late fees, attorney fees, etc. Why are loan mods so hard to come by for people like me who have the income to make our payment? I figured that if they put my $40,000 I owe them in a loan mod, they would make $120,000 over the life of the loan. Isn't that their business? Interest? Not sure the reason that I can't get this - can anyone enlighten me?

Edith of TX 2:35PM February 09, 2008