251 replies to this topic

[Danosaur]

My wife and I are actually contemplating forclosure or even a short sale right now. We got our house in 2006 right at the peak of housing bubble ..now we are sitting about 100k underwater. While we can afford the mortgae we really don;t want to pay for it when we have negative equity and will have negative equity for at least 10-20 more years. So, we have taken steps tor see if we can get pre-qualified for a new home and move then rent out the old one for a few months (for leagl purposes on the prequal) and then just stop paying and either short sale or let it go into forclosure. Our mortgage company refused to work with us on a mortgage restructure and we went through NACA.com for assitance with that. I would not recomend them...ridiculously confusing and they hook into you like ACORN...wanting you to be advocates and things when the assistance they provide does nothing. don;t get me wrong we love our home...and we would do just about amnythig to stay...but it just doesn't see finacially sound anymore to keep when we could get a bigger house in a better neighborhood for WAAAY less than we paid in 2006 for our tiny little 3BD home.

[The Real Jeffrey Lebowski]

Hi (The Real Jeffrey Lebowski),

From the email provided it looks like Teri was suggesting the 3% downpayment option, however when she went to print off the commitment letter it did not show 3% downpayment, it still showed 10%. Based on the decision engine at no point was your loan approved for less than 10% downpayment, it simply was firing ineligible due to credit class.

We have your credit score as (some number)

Debt to income ratio of (some other number)

Forgive me - I work in Home Equity, but I don't fully understand what this "bank speak" effectively means for me.

I know that an underwriter had switched my mortgage application to Fannie Mae Home Path without my knowledge or approval.
I know that after escalating this to (TOO BIG TO FAIL! escalation chick), I was able to momentarily get everyone on the same page and eventually I agreed to Home Path with the 3% down as it was (supposedly) clearly explained to me in multiple emails.

What I don't know or understand is why this has been such a tremendous and spectacular failure of communication through the process - both, between the (TOO BIG TO FAIL!) people and myself, and apparently even between (TOO BIG TO FAIL!) Job functions.
I don't know or understand why this was only discovered on my closing date.
I don't know or understand why I haven't been presented any solutions on how (TOO BIG TO FAIL!) is going to fix this.
I don't know or understand how it would help the bank to give a team member such a poor experience on a mere $57,500 mortgage when the bank stands to lose so much more by bad word of mouth (because I would have to be insane to recommend anything we do to anyone I know based on this experience.)

Lets go fuckers! I'm just gettin' started! I got nothing but supervisors to escalate this to...

I'm getting plenty drunk and eating Chipotle tonight, I'll tell you what.

[mig50]

I'm getting plenty drunk and eating Chipotle tonight, I'll tell you what.

regardless of how this works out for you, we need to party based on this statement alone.

[glitterbot]

Word. My buddy also had it come in handy too... Sounds like it's definitely worth it. I'll just have to focus on finding a company that not overtly evil.

Thanks!

word.

i only had mine for the 1st year. i wouldn't recommend getting one after the initial year. i mean shit is gonna constantly be breaking down on you but most of it you can DIY. I've honestly never been like "damn i wish i had that warranty now!"

the only time was when i first moved in and the pipe burst and i was like "wahhh i dont know what i am doing! this was the biggest mistake of my life!"

now when that shit happens i'm all "get me the wrench"

totally. i think first year is key, mostly because you can negotiate it into the cost of the house. beyond that and you're paying for it out of pocket. might as well roll the dice and pay for it only if it breaks. it probably works out in your favor, unless the house is a piece of shit. in which case, why buy it?

plus, if you get the coverage the first year you're sort of saying "i want this to cover the stuff you knew wasn't 100% but didn't fix because you knew you were moving", or maybe stuff they put a band aid on to sell it even though they knew it might need more work done. after that, if it's an old home stuff's going to happen. you just deal with it.

Word. We've lived in our house six weeks and have had 3 claims to the home warranty people. A bunch of stuff was wrong that the home inspector didn't find. We're hoping (c'mon!!) the water heater goes out before the warranty expires.

Sadly, they don't do anything outside the house. So, the valve to turn the water off to the house, that was busted and we had to pay out of pocket. Also, the irrigation system leaks all over the place, once again, out of pocket.

who is your home warranty company? we have a plumber coming out tomorrow to see to our hotwater tank. unhappily, it is not leaking just not getting hot enough. i want it replaced but i am afraid they might just try to fix it. we have Old Republic Home Protection. How much is your service call fee?

[Tony]

My wife and I are actually contemplating forclosure or even a short sale right now. We got our house in 2006 right at the peak of housing bubble ..now we are sitting about 100k underwater. While we can afford the mortgae we really don;t want to pay for it when we have negative equity and will have negative equity for at least 10-20 more years. So, we have taken steps tor see if we can get pre-qualified for a new home and move then rent out the old one for a few months (for leagl purposes on the prequal) and then just stop paying and either short sale or let it go into forclosure. Our mortgage company refused to work with us on a mortgage restructure and we went through NACA.com for assitance with that. I would not recomend them...ridiculously confusing and they hook into you like ACORN...wanting you to be advocates and things when the assistance they provide does nothing. don;t get me wrong we love our home...and we would do just about amnythig to stay...but it just doesn't see finacially sound anymore to keep when we could get a bigger house in a better neighborhood for WAAAY less than we paid in 2006 for our tiny little 3BD home.

dude, you're me, circa august 2009. not as bad underwater (we actually appraised only about $10k below what we owed, but the offers we were getting were waaaaaaaaaaaaaaay lower than that) but same exact mindset as you. we met with our realtor and finance guy, also met with a lawyer who specialized in short sales to make sure we weren't going to be shooting ourselves in the foot.

i'm not a lawyer, but the summary of that conversation (well worth the hourly rate based on the info they gave us, by the way) is as follows:
if you have a straight up single mortgage and you qualify for the foreclosure process, your credit is screwed, but once you're done with it, you're pretty much free and clear.
if you have a single mortgage and you qualify for the short sale, your credit is still screwed - albeit to a lesser extent - but again, pretty much free and clear.
if you have a 2nd mortgage on the house - like we did - you're all kinds of screwed. we purchased our house before the bubble, but took out some equity to remodel and put in our pool when the value shot up. that 2nd mortgage, even though it was all for improvements to the property, is NOT considered to be part of the purchase price of the house. we might as well have taken it to vegas or bought an escalade as far as the bank was concerned. net result: even if we qualified for foreclosure/short sale, the bank can (and will) come after us for the balance of the 2nd mortgage. if you pre-settle with the bank, they may accept a portion of that amount, but the important factor was that the 1st mortgage would be forgiven, but the 2nd would NOT. also, it would have screwed our credit. the other catch is that we would have had to qualify for a house and basically move in before we could even start the foreclosure/short sale process on the existing house. it would have been too big of a gamble for us, so we decided to stay put. oddly liberating, once we changed our mindset that we were staying, but we were also looking to take advantage of somebody else's misfortune and move into a big pimped out house with diamonds and shit everywhere.

PM me if you want the lawyer's info. it was like $130 or something for the consult, but it probably saved us tons of time and really helped with what decision to make.

[allisonorphan]

My wife and I are actually contemplating forclosure or even a short sale right now. We got our house in 2006 right at the peak of housing bubble ..now we are sitting about 100k underwater. While we can afford the mortgae we really don;t want to pay for it when we have negative equity and will have negative equity for at least 10-20 more years. So, we have taken steps tor see if we can get pre-qualified for a new home and move then rent out the old one for a few months (for leagl purposes on the prequal) and then just stop paying and either short sale or let it go into forclosure. Our mortgage company refused to work with us on a mortgage restructure and we went through NACA.com for assitance with that. I would not recomend them...ridiculously confusing and they hook into you like ACORN...wanting you to be advocates and things when the assistance they provide does nothing. don;t get me wrong we love our home...and we would do just about amnythig to stay...but it just doesn't see finacially sound anymore to keep when we could get a bigger house in a better neighborhood for WAAAY less than we paid in 2006 for our tiny little 3BD home.

oh man. dont get me started on this! i purchased my home in 2005. while i am happy for the folks that are getting sweet deals on homes, i'd be lying if i said it comes without a bit of bitterness!

i am currently in the short sale process. it pretty much sucks. my phone is ringing all the time with debt collectors, credit counselors and attorneys! my house is listed at 49,900 and is considered on the high end for size and location! at this point, i just kind of dont think about it anymore. i cant afford to have a second home and i have made a decision to stay in los angeles after landing a position as a school counselor.

it is a complete bummer that i am losing my down AND all equity AND getting a serious blemish on my credit! however, i just try and focus on the fact that i have a great job and am renting a really cute guest home!
best of luck to you and what you decide to do.

[Mary]

It is a complete bummer. This trashed economy has taken literally taken money away from people who will never get it back.

At least some of us are young enough to recover somewhat before retirement. I know people who are still working like dogs in their 60s because the investments that were supposed to be safe and give them money to live on went down the crapper.

[Danosaur]

My wife and I are actually contemplating forclosure or even a short sale right now. We got our house in 2006 right at the peak of housing bubble ..now we are sitting about 100k underwater. While we can afford the mortgae we really don;t want to pay for it when we have negative equity and will have negative equity for at least 10-20 more years. So, we have taken steps tor see if we can get pre-qualified for a new home and move then rent out the old one for a few months (for leagl purposes on the prequal) and then just stop paying and either short sale or let it go into forclosure. Our mortgage company refused to work with us on a mortgage restructure and we went through NACA.com for assitance with that. I would not recomend them...ridiculously confusing and they hook into you like ACORN...wanting you to be advocates and things when the assistance they provide does nothing. don;t get me wrong we love our home...and we would do just about amnythig to stay...but it just doesn't see finacially sound anymore to keep when we could get a bigger house in a better neighborhood for WAAAY less than we paid in 2006 for our tiny little 3BD home.

dude, you're me, circa august 2009. not as bad underwater (we actually appraised only about $10k below what we owed, but the offers we were getting were waaaaaaaaaaaaaaay lower than that) but same exact mindset as you. we met with our realtor and finance guy, also met with a lawyer who specialized in short sales to make sure we weren't going to be shooting ourselves in the foot.

i'm not a lawyer, but the summary of that conversation (well worth the hourly rate based on the info they gave us, by the way) is as follows:
if you have a straight up single mortgage and you qualify for the foreclosure process, your credit is screwed, but once you're done with it, you're pretty much free and clear.
if you have a single mortgage and you qualify for the short sale, your credit is still screwed - albeit to a lesser extent - but again, pretty much free and clear.
if you have a 2nd mortgage on the house - like we did - you're all kinds of screwed. we purchased our house before the bubble, but took out some equity to remodel and put in our pool when the value shot up. that 2nd mortgage, even though it was all for improvements to the property, is NOT considered to be part of the purchase price of the house. we might as well have taken it to vegas or bought an escalade as far as the bank was concerned. net result: even if we qualified for foreclosure/short sale, the bank can (and will) come after us for the balance of the 2nd mortgage. if you pre-settle with the bank, they may accept a portion of that amount, but the important factor was that the 1st mortgage would be forgiven, but the 2nd would NOT. also, it would have screwed our credit. the other catch is that we would have had to qualify for a house and basically move in before we could even start the foreclosure/short sale process on the existing house. it would have been too big of a gamble for us, so we decided to stay put. oddly liberating, once we changed our mindset that we were staying, but we were also looking to take advantage of somebody else's misfortune and move into a big pimped out house with diamonds and shit everywhere.

PM me if you want the lawyer's info. it was like $130 or something for the consult, but it probably saved us tons of time and really helped with what decision to make.

Hey tony thanks for the advice. We do have a second mortgage albiet its a HELOC and not really all much more than a basci college loan. It is also with a different lender so me thinks if we forclose or shortsale our dfirst the second we are still on the hook to pay back...but with home prices what they are today we could probably swing that. I don'k the HELOC lender would come after us if we keep paying them. The rub is that we CAN afford to pay our mortgages and we could stay and would like to...but it doesn;'t make any finacial sense to stay in house so far underwater when our family needs are getting bigger. We are working with a lender and a lwayer right now so...guess we will have to see what they say...good news is we can most likely pre-quailfy for another home under FHA even with out a renter...so ...we will see.

[John MFer]

We might end up just renting out our old place.

are both yer loans FHA?

The new loan is not, it's conventional. The old loan was FHA I believe, we only put down 3% in the beginning (2003). But then during the bubble we worked with the lender and had them remove our PMI, which meant we had at least 20% equity at the time. I would assume the loan would have been converted to a conventional loan at that point, no?

[Jacki O.]

fuck this thread is depressing.

[jeremx]

fuck this thread is depressing.

it consistently makes me feel better about the deal we got. sucks that it comes at the same time as everyone else seems to be getting the shaft.

although i keep reading all thse magazines about growing your own grapes for wine, hops for beer, and keeping bees for honey and wax, etc.. and am like, "fuck! i wanna do that!"

[Jacki O.]

fuck this thread is depressing.

it consistently makes me feel better about the deal we got. sucks that it comes at the same time as everyone else seems to be getting the shaft.

although i keep reading all thse magazines about growing your own grapes for wine, hops for beer, and keeping bees for honey and wax, etc.. and am like, "fuck! i wanna do that!"

yeah lets turn this thread more positive! sorry for the people that are getting fucked over. i will probably be in your boat in a few years. but until then, let's grow hops!

though i dont think AZ is a good climate for hop growing.....prove me wrong?

[jeremx]

though i dont think AZ is a good climate for hop growing.....prove me wrong?

http://tinyurl.com/2e4fa3a

[Jacki O.]

though i dont think AZ is a good climate for hop growing.....prove me wrong?

http://tinyurl.com/2e4fa3a

COOL!

but most of those links are about failing at growing hops in phoenix

[larah]

Well, in semi-happy news...we put an offer on a short sale home last week and it was accepted! Now we just have to wait 8 million days to see if the bank accepts it. Cross your fingers!