I am in the process of having a LM done, but the servicing company will not responed. I am in foreclose not 1/16/09, Hired an attorney, but after putting 2 and 2 together me and my husband really don’t think that we will get the LM and can’t afford the mortage, we are upside down in the house.

Can we tell the attorney that we would like to give the house back to bank and walk away owing nothing, I am so sick over this I can’t sleep or eat.

Thanks for doing a good job of answering people in need.

Thanks,
Lou (more…)

I can not afford to pay my mortgage an retire in 6 year on my pension.  I have an V A loan, with Citimortgage of Citigroup. 

If I stop paying and notify them that I can afford the payment.  What could happen, credit wise can I repair it. Or could judgement against me or wage bank account or ect. 

What the least and most that could happen and how to deal with it. 

John (more…)

Paul-

The other day we were talking about deed in lieu of foreclosure.  My client that has a property that has second was willing to do a deed lieu.  They approved the deed in lieu, but are still continuing with foreclosure proceedings.  You said that they could not do deed in lieu, because the second had to release the mortgage.  What if we requested a copy of the note from the second from the servicer, and they did not have it?  Would it give us leverage or time to be able to short sale the property?  

Thanks,
Kel (more…)

“Both short sales and deed-in-lieu-of-foreclosure have less adverse impact on the borrower and their credit report than foreclosure”.

OCC and OTS Mortgage Report, Third Quarter 2008 (Pg.22)

I’ve seen Experian ‘update’ a fresh date of status as a response to a consumer dispute all too often and here’s a case where it backfired on them.

Consumer did a deed-in-lieu of foreclosure in May 2002.  The Experian report listed the following prior to his July 2006 dispute:

“Status: Creditor received deed/Foreclosure proceedings started. $8,702 past due as of Oct 2002. Account history: Creditor received deed as of Oct 2002. Foreclosure proceedings started as of Sep 2002, Aug 2002, June 2002, 120 days as of May 2002, 90 days as of Apr 2002, 30 days as of Mar 2002” (emphasis added)

Dispute then gets filed with Experian in September 2006 and as a result HSBC informs Experian that the deed-in-lieu was May 2002.  Not only did HSBC verify the May 2002 date, but the customer sends in a copy of the deed-in-lieu as verification!  Doesn’t matter to Experian; they provide an updated ‘date of status’ for the consumer (IMO as a special thank you), as evidenced by the following after the dispute:

“Status: Creditor received deed/Past due 180 days. $8,702 past due as of Sep 2006. Account history: Creditor received deed as of Sep 2006, 180 days as of Sep 2002, Aug 2002, 120 days as of Jun 2002, 90 days as of May 2002, 60 days as of Apr 2002, 30 days as of Mar 2002. This account is scheduled to continue on record until Dec. 2008” (emphasis added).

Experian was taken to Court on this one and there’s a possibility that there could be punitive damages awarded in this case.  There’s a lot more going on than what I’ve typed (particularly that Experian loves the ACDV system and claims “we don’t do any other independent investigations”), but all in all, this opinion and order is a solid smack on Experian’s behind. 

Maybe the credit bureaus will get the message, and maybe they won’t.  Punitive damages are awarded for willful violation of the FCRA which per the Supreme Court includes “reckless disregard”.  Gorman may be entitled to punitive damages for Experian’s reckless disregard.  In my opinion, that would help them get the message.

Gorman v. Experian Information Solutions, Inc. et al (07 CV 1846 (RPP), S.D.NY, 2008)

I have and 80/20 loan with the same lender. I tried to short sale the home with no luck. It has been on the market for 90 days. I am 6 mos past due. They refuse to work with me so I am wondering about a Chap 13 to keep the house or a deed in lieu (which they will accept on the 80 loan)??? What are my best options. I’m in NV.

Shannon (more…)

We have bought a house for 315,000 in  August 2006 in Florida.
We paid 20% down payment 63,000 at closing.

The mortgage is negative ARM, prime plus 2.5 percent for 40 year.
 monthly partial interest payment is 1,200. Full payment would be about 3,200 i.e. each month adding 2,000 to the loan.

My husband is a state employee and job-transferred to another city 300 mile away in January 2008.
He is renting a 500/month Apt  there.
I am a part-time graduate student with two kids 6yo and 8yo.

Husband’s salary is 69,000/year now (FiCO score 750) but at the time of loan it was 41,000.
Our residence’s value is now about 220,000 but there is no sale in the neighborhoods last couple of years with about 8 houses for sale.

We cannot afford the house-mortgage (now loan about 280,000). Also me and two kids want to move to my husband’s place. There is no buyer last 7 months.

House is under our name and loan is under my husband’s name only.

We do not have any other credit card loan. We have friends who will rent us house even with FICO score is destroyed.

Can we ask the bank to take our house and release us from the debt?
What is the procedure?

What will be our future credit and  IRS tax burden?

Thanks,

Devi (more…)

Hi Paul:

I have 2 properties. 1 primary residence with an option arm, that I have had FSBO and am last resort listing with a realtor friend at no fee to see if we can move it conventionally or lease option. The smaller house I have a mortg & HELOC on I am planning to move into.

These were supposed to be income projects (job) and since everything has tanked, I am resurrecting old skills to get back into traditional job market, but no income now and rapidly depleting HELOC for live on money. I have spoken with the loan co. about the option/ARM house and it seems my options are short sale or deed in lieu, no loan mod without a job.

After reading up on myfico.com, it seems that either of these have the same affect on my credit, but at least with a deed in lieu, I can walk and preserve assets I have left rather than hang on with no income for a potential buyer on short sale. They said they will not pursue a deficiency judgment with a DinL, but a 1099 will be issued for tax on deficient amount. I don’t have funds or stamina to deal with a TILA investigation as a potential solution.

Also, since all my accounts have been paid on time, never late, it seems to make sense to keep current with payments until a deed in lieu is finalized for less impact on credit. Am I missing anything in this thought process? Also, how horrible is credit impact with a 30 year history or perfect credit & what can I do to minimize the affects if I do go through with DinL?

Many thanks,

Catherine (more…)

My husband & I were able to sucessfully complete a short sale in April!  We listed the home in February had an offer in March and closed April 28.  This was no small task!  My husband, I and our Real Estate Agent were on the phone with WAMU no less than 5x a day!  Our situation was different in the fact that I was diagnosed with a brain tumor and needed to move closer to Standford University for my treatments (Genuine Hardship). 

My question is:  We made every mortage payment on time and the only reason we sold was so we could relocate for my medical treatment.  I know the previous advice given was there is a 24 month seasoning period before we can purchase another home; however, what about VA loans?  Do they fall under the same set of rules?  My husband has VA benefits and we would like to take advantage of something he worked so hard to achieve. 

To all those out there in the process of a short sale.  BE DILLIGENT & KEEP YOUR HEAD UP!  Don’t sit back and wait for the bank to call you; you have to take control and get anwsers.  Push past the entry level customer service reps and get to someone in charge.  Worked for me.  Warm Regards

Jessica (more…)

Given the near impossibility of getting a loan modification, doing a short sale, or deed in lieu, I have come to the conclusion to foreclose and then deal with the recourse second mortgage.

My question is, if I do this, with arrears, interest and etc (or does this stop at some point?), will I be likely able to negotiate a debt settlement with the only other option being a 13 BK?  The issue is my wife is a teacher and has been for 25 years at the same school so I think they may try to  push me to pay thereby forcing me to BK. 

Finally, how would I go about paying less on this debt at this point and would they do so with BK as a threat?

Gene (more…)