Upside Down Mortgage

Archive for August, 2008

What Is Loss Mitigation Review

Question: Indymac is my Lender. Loss mitigation reviewing my loan pkg. Should I call them with all this news going on?

I haven't been late at all, but my mortgage value is $166k down from what we purchased it at 2 years ago. There are a couple of foreclosures on our street. My husband and I commute to the bay area. So with gas prices skyrocketing and twin daughters driving and going to college I asked Indymac on June 26th to consider a loan resolution for us. I received a letter from Loss Mitigation dept dated July 7th that they are reviewing it and will get back to me within 30 days. Should I call them or wait for 30 days?

Answer: By all means stay in close contact with them. It may be a struggle finding the person who has your file, but be persistant. Nice but persistant. I would call them and don't hesitate to make that call once a week until you hear something.

We're dealing with CW. We're in the biz - no sales - no money... We put our house on the market and began making partial payments, they called 3x a week. After 90 days, they call and the discussion was more like, maybe we could consider a short sale or deed in lieu of foreclosure. Keep trying to sell your house, reduce the price and we'll consider any and all offers you may receive. Next call told us that if we made a full payment every 89 days, it resets the foreclosure clock sort of speak. So we've significantly reduced our price and are making one full payment every 89 days. The calls have slowed down, maybe one a week now. No bites on our house, but we just reduced in on Sunday. It's a game. It's a tough one to fight, because you become stressed and weary and tired and sick of it. But you are not alone, there are millions of us going through similar scenarios. Hang in there.

Do It Yourself Loan Modification Insiders Review

If you're new around here, you might want to subscribe to our Upside-Down Mortgage RSS feed. It's quite likely the only feed of it's type on the internet!

Mortgage Modification Chase Bank

Finance Establishments are improving at processing loan alterations. For awhile it looked there there wasn't much action to support the PR that banks offered. Now things are getting to standard speed. It simply took longer than expected to set up the staff and processes needed to handle the flood of borrowers who want a mortgage modification. Banks are much better supplied now and a lot of them are making good faith efforts to help.

But that isn't the full picture. Even though lenders are now getting more alterations complete, they are inclining to modify loans whose adjustment will cost them the least in revenue or auto loans after bankruptcy that were so patently defective to start with that they would've be thrown out if they hit a judge's bench. There are a large amount of incomplete or missing loan documents and improperly done disclosures out there.

So, to a degree, the banks are putting quite a PR spin on the cleanup of a problem they helped create.

That is why the Making Home reasonable Plan is so vital. It addresses millions of homeowners whose loans are clean and legal or whose adjustment might otherwise cost the banks dearly. These are the folks who have been getting the cold shoulder so far because they are close to making it without any help at all. These are the families that have been getting fell for loan alterations - the banks have been simply demanding continued payment.

How will the Making Home reasonable Plan {work?

First, your home loan payment must be not more than 38% of your monthly earnings. So if your home loan payment is already at or below 38% of your monthly income then your chances of being licensed for the program are better. If your payment is well above 38% - it isn't so good. Banks get to pick which loans to modify on this program, so it's natural that they'll want to provide alterations to loans that start out below the 38% mark {first.

Then, the US Treasury and the lender split the price of further principal reductions until the home loan payment is 31% of your monthly income. This indicates that banks will incline toward modifying either smaller loans or auto loans made to people with decent, stable incomes.

The "Pay-for-Performance Success Payment" will give you $1,000 a year for 5 years, as you keep current.

How do you qualify for Making Home reasonable Plan?

Some general initial qualifications include the {following:

The loan must have originated before January 1, 2009 and it has to be owned or warranted by Fannie Mae and Freddie {Mac.

you need to occupy the property as your first residence.

the personal loans {cannot exceed $729,750.

Can't surpass $729,750.

Your mortgage payments are higher than 31% of 31% of your gross monthly income and you are experiencing industrial hardship.

About the Author:

Learn more about cash advance payday loan by visiting our credit card debt resource website.

Article Source: ArticlesBase.com - Loan Modifications and the Making Home Affordable Plan

Housing Bubble Prices

Question: What caused the initial housing bubble burst that caused the sub prime crisis?

I know that after the bubble burst housing prices declined and interest rates went up. People with sub prime and adjustable rate mortgages started to default at high rates which caused the crisis. What I don't know is why the bubble burst. Apparently housing prices had been steadily going up since WW2. How did the housing market loose its strength all of a sudden? Anyone know?

Answer: A combination of greedy venture capitalists jacking up real estate values and the government's ill conceived solution of making a bank make a loan for these ridiculously high selling prices rather than just curb the price gouging. The market prices started to spike in the 80's when "investment properties" were in vogue... they never came back down.
Now let's look at the home buyers. NAFTA was the single worst idea ever unleashed on the working population of the United States in it's history. The number of companies that exported jobs in all salary ranges is well into the hundreds of thousands. politicians always point to unemployment but they will never dare go near the term "under employment" which is where you have people who invested in MBAs and doctorates fighting over $10/hr jobs. Now the majority of people can not really afford a mortgage at the overpriced asking prices but banks had to make them a loan anyway.

There you have it, a combination of unchecked greed and a customer base crippled financially by stupid public policies caused the housing market nosedive. And they only bailed out the rich... go figure.

Pimco PM on Housing Prices