Loans, Debt & Credit - View Single Post - EMC

CashCow · 12-30-2008, 11:39 PM

Hello all, I know this is most likely on here, but couldn't find it so I figured I would ask

How does your liabilities surplus need to appear to the lender to look favorable to getting a loan mod? For example, do you need to show a $550 surplus or a $500 negative every month? Which is better? I want to have this down before I call my lender (I am currently down 60 days)

Do you have to include credit card payments if you are currently not paying them? (I know that sounds bad, thinking about BK, overwhelmed and biz is slow)

I have two investment properties that have 1st and 2nd's on them that are upside down that I am letting go, will attempt short sales on those, so do I need to include those payments in the liability calculations since I am not paying on them?

I am self employed, my income is like a roller coaster and is all through bank statements, deposits, checks, wire transfers etc. so not sure if they will just take an average over 12 months or will instead look at the last two years tax returns and a P&L, anyone familiar with this?

In addition, my wife is on the bank statements, however not on the loan and doesn't want to go on the loan, if something bad did happen with the house, we want at least one of us to have good credit, not sure how the lender will look at that?

Loan Details:
-I have a first at 600k, purchase money, 5.375% I/O 5yr, 2 years left on it before adjustment
-I have a second at 150k, was purchase money at a high interest rate, but I did a rate/term refi a year ago to bring the interest rate down to 5.5% on a 30/15, now is even lower due to fed lowering rate as it is a HELOC

Total loans owed is 750,000, house is worth 450,000 at max

I am not sure what they can do for me on the first, I have heard of people getting 3% Int Only loans for 5 years and that would be amazing, but not sure how difficult that would be with EMC or if it is even true. Principle reduction on the 1st would be a dream come true, but then again, I have read that is unlikely (however still possible) at this time,even if you are way upside down. What have you all seen happen in these cases on a 1st?

For the 2nd, I am considering BK to wipe it out. My question is if I wipe out the 2nd due to BK and the house being so far underwater, is there a chance there could be a principle reduction on the 1st to make it inline with the value of the property?

I have avoided all calls from the lenders so far, wasn't sure what to do or what to say, hate to tell them I make 10k a month to find out I have to large of a surplus. Also since I am not sure if they look at bank statements or tax returns and P&L

In a perfect world, I could short sale both of the investment properties, get principle reductions on my first and seconds through a BK and lower my rate on my first to an long term affordable payment.....we will see

Sorry for the long post, I would love to hear what you all have to say

Thanks!

12-30-2008, 11:39 PM	#1 (permalink)
CashCow Member Join Date: Apr 2008 Posts: 14 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	EMC - Attempt at loan mod Hello all, I know this is most likely on here, but couldn't find it so I figured I would ask How does your liabilities surplus need to appear to the lender to look favorable to getting a loan mod? For example, do you need to show a $550 surplus or a $500 negative every month? Which is better? I want to have this down before I call my lender (I am currently down 60 days) Do you have to include credit card payments if you are currently not paying them? (I know that sounds bad, thinking about BK, overwhelmed and biz is slow) I have two investment properties that have 1st and 2nd's on them that are upside down that I am letting go, will attempt short sales on those, so do I need to include those payments in the liability calculations since I am not paying on them? I am self employed, my income is like a roller coaster and is all through bank statements, deposits, checks, wire transfers etc. so not sure if they will just take an average over 12 months or will instead look at the last two years tax returns and a P&L, anyone familiar with this? In addition, my wife is on the bank statements, however not on the loan and doesn't want to go on the loan, if something bad did happen with the house, we want at least one of us to have good credit, not sure how the lender will look at that? Loan Details: -I have a first at 600k, purchase money, 5.375% I/O 5yr, 2 years left on it before adjustment -I have a second at 150k, was purchase money at a high interest rate, but I did a rate/term refi a year ago to bring the interest rate down to 5.5% on a 30/15, now is even lower due to fed lowering rate as it is a HELOC Total loans owed is 750,000, house is worth 450,000 at max I am not sure what they can do for me on the first, I have heard of people getting 3% Int Only loans for 5 years and that would be amazing, but not sure how difficult that would be with EMC or if it is even true. Principle reduction on the 1st would be a dream come true, but then again, I have read that is unlikely (however still possible) at this time,even if you are way upside down. What have you all seen happen in these cases on a 1st? For the 2nd, I am considering BK to wipe it out. My question is if I wipe out the 2nd due to BK and the house being so far underwater, is there a chance there could be a principle reduction on the 1st to make it inline with the value of the property? I have avoided all calls from the lenders so far, wasn't sure what to do or what to say, hate to tell them I make 10k a month to find out I have to large of a surplus. Also since I am not sure if they look at bank statements or tax returns and P&L In a perfect world, I could short sale both of the investment properties, get principle reductions on my first and seconds through a BK and lower my rate on my first to an long term affordable payment.....we will see Sorry for the long post, I would love to hear what you all have to say Thanks!