Trying to figure out 31%

[jazz123]

I'm confused on the 31% - We have been on 3 month trial with Chase (just made 8th monthly payment). Now have been denied because of low income. Originally when info was sent to Chase months ago we were self employed in concrete construction. Since that isn't doing well....my husband is employed by someone else. So I am told to resubmit updated info to Chase. I'm trying to figure out what the 31% would be:
Mortgage balance : 245,755.00
Original payment (prior to trial) : 1668.00
Trial payment : 417.00
Property Taxes & Insurance: 650.00/mo.
Would monthly income of $4000.00 be at the 31% range??? Or what monthly income would be needed to qualify?
Any help with this would be GREATLY appreciated.....

[jakelabry]

No, a GROSS income of $4000 per month will not work in this scenario - 31% of 4000 is $1240 so your principle, interest, taxes, insurance, etc. must equal this amount. You say your taxes and insurance is $650 per month so subtracting that from $1240 equals $590 left for principle and interest. Your mortgage balance is $245,755, the lowest the gov'ts program will go is 2% for 40 years and, at $245K, principle & interest is $744.21. They would have to forbear some of your principle - somewhere in the neighborhood of $50K.

BTW - you can't just make up income to fit the scenario. Any income you report will have to be verified.

[jazz123]

Thanks for the info......I realize the income will be verified.....I just wondered if it is even worth the efffort anymore!!!!!

[jakelabry]

Originally Posted by jazz123

Thanks for the info......I realize the income will be verified.....I just wondered if it is even worth the efffort anymore!!!!!

Well, don't give up so quickly! Forbearing principle is the third step of the waterfall process applied in the HAMP program so it could still work. Also, they may consider you for an in-house modifcation if the HAMP doesn't work. Keep pushing Chase if you want to save your house.

[sns0710]

Originally Posted by jakelabry

No, a GROSS income of $4000 per month will not work in this scenario - 31% of 4000 is $1240 so your principle, interest, taxes, insurance, etc. must equal this amount. You say your taxes and insurance is $650 per month so subtracting that from $1240 equals $590 left for principle and interest. Your mortgage balance is $245,755, the lowest the gov'ts program will go is 2% for 40 years and, at $245K, principle & interest is $744.21. They would have to forbear some of your principle - somewhere in the neighborhood of $50K.

BTW - you can't just make up income to fit the scenario. Any income you report will have to be verified.

Thank You for this. It really has helped me understand what has been going on with mine. The first time they told me our income was not enough off by 100.00.
I did not include any of the over time my husband gets. (he sets his own amount of OT each week). Hoping this will help us now. Waiting for negotiator to call.
My question now is where does the HOA fees fit in here?

[jazz123]

Thanks jakelabry!!!!!!!!!!!!! I'm not giving up quite yet. Have been in this fight for over a year....and still winning. Besides it seems there's no reasoning sometimes behind who gets a mod and who doesn't.

[jakelabry]

Originally Posted by sns0710

Thank You for this. It really has helped me understand what has been going on with mine. The first time they told me our income was not enough off by 100.00.
I did not include any of the over time my husband gets. (he sets his own amount of OT each week). Hoping this will help us now. Waiting for negotiator to call.
My question now is where does the HOA fees fit in here?

The HOA fees are actually supposed to be figured into the 31% - it's really principle, interest, taxes, insurance, and HOA fees if there are any.

[sns0710]

Originally Posted by jakelabry

The HOA fees are actually supposed to be figured into the 31% - it's really principle, interest, taxes, insurance, and HOA fees if there are any.

Thank You, just one more question. In the previous case you said, You say your taxes and insurance is $650 per month so subtracting that from $1240 equals $590 left for principle and interest. The taxes and insurance were 650, if there were HOA fees would you subtract them here also?

[Jillian118]

Originally Posted by sns0710

Thank You, just one more question. In the previous case you said, You say your taxes and insurance is $650 per month so subtracting that from $1240 equals $590 left for principle and interest. The taxes and insurance were 650, if there were HOA fees would you subtract them here also?

Yes you would, but sometimes they include HOA's in the mods and sometimes they dont....so depending on how much your hoa's are it may be ok.

But if they cannot get down to the 590 for principle and interest, you are going to have a tough road

[sns0710]

Originally Posted by Jillian118

Yes you would, but sometimes they include HOA's in the mods and sometimes they dont....so depending on how much your hoa's are it may be ok.

But if they cannot get down to the 590 for principle and interest, you are going to have a tough road

I was just using the 590 from the quote you gave in the previous post.
Gross income 3504.00 (without the OT is 3072.00) , 31% of that is 1086.24. Taxes & insurance, 433.75. leaving 652.49. Balance of loan 204.479.41 at 2% , 40 years, leaves P&I at 619.22.
Did I do this right?
I did not include the HOA 175.00
Does PMI have to be added here somewhere?
Thank You again for helping me.

[Jillian118]

Originally Posted by sns0710

I was just using the 590 from the quote you gave in the previous post.
Gross income 3504.00 (without the OT is 3072.00) , 31% of that is 1086.24. Taxes & insurance, 433.75. leaving 652.49. Balance of loan 204.479.41 at 2% , 40 years, leaves P&I at 619.22.
Did I do this right?
I did not include the HOA 175.00
Does PMI have to be added here somewhere?
Thank You again for helping me.

Do you already have PMI?? And they are supposed to add in the HOA but they don't always if they add it in you may not qualify for hamp.

BUT, we also we have learned that chase has a different criteria for their in house which is on a sliding scale depending on income levels, starting at 31% and going up to 40%

It is in one of Erzulies posts & I think your gross would put you in the 34% bracket. So you may be ok there, they call it Champ.

[sns0710]

Originally Posted by Jillian118

Do you already have PMI?? And they are supposed to add in the HOA but they don't always if they add it in you may not qualify for hamp.

BUT, we also we have learned that chase has a different criteria for their in house which is on a sliding scale depending on income levels, starting at 31% and going up to 40%

It is in one of Erzulies posts & I think your gross would put you in the 34% bracket. So you may be ok there, they call it Champ.

Yes I have PMI each month included in mortgage payment, 89.34 and I am with BOA not Chase if that matters.

[Jillian118]

Originally Posted by sns0710

Yes I have PMI each month included in mortgage payment, 89.34 and I am with BOA not Chase if that matters.

I'm sure BofA has their own in house rules, so you may want to hop on the BOA side and see what they have been offering.