Promised update from credit union - I know you're waiting with bated breath
I had asked them to help refi long term credit card debt 300k worth!! and to refi some of their mortgages to longer term at a lower rate.
They spent a lot of time analyzing my situation. Their response was that an interest rate or term adjustment would have little effect on my negative cash flow situation. They are willing to help but only if other issues are dealt with to indicate a possible total resolution.
The points they said I need to do are:
1. Reduce credit card debts greatly through negotiation. My comment: there goes the score
2. On the Four super negative cash flow upside down condos: get rid of em through negotiated sale or surrender. My comment: 40 year 3% would work
Question: has anyone seen this great a rate offered?
3. Occupancy: the credit union wanted to know how rentals were going. Fortunately it seems that more of our renters are paying ontime than ever. Our collections are about 20k a month. Our renters dont want to get behind either.
4. Reorganization: the credit union said a chapter 13 bankruptcy may be required to get all creditors to comply with a VIABLE repayment plan.
My first response was disappointment. My second appreciation for what I thought was their excellent analysis.
I am doing my accounting now with an eye to having to file Chapter 13 - actually it is prolly Chapter 11. I would prefer loan amounts knocked down to actual market value - in some cases this is 40% writedown of principal.
Why try keeping going unless all the financials are in place for a successful operation?
I dont want a cheap workout because why do I want to end up as simply servicer for someone elses property?. In my instance PI has to come in at about 55% of rent. And I needed to leave at least 20% of rents for maintenance. Even in hard times pipes have to be fixed and a landlord is still COMPETING with other properties for rent.
I called and talked at length to a nonprofit debt counseling service. It was hilarious. On 210k of credit card debt what they came up with was a monthly payment of $5000 over five years. i think the interest rate they offered was 13%.
My present credit card rate is about 10% and the monthly payment $3500.
However they were helpful in asking me personal budget questions over the phone; something I have to do with Chase when I apply for loan modification if I go that way.
Well this is a lot of info in one message: hope it helps someone else working things out!
I made a list of all the people who are helping me. That keeps me from feeling isolated and discouraged.
Joe in Mpls