Help with Modification Process

[crwhart]

Just found this website, thanks for all the information, but I am new to this and still have a few question. Our mortgage is with CitiMortgage, obtained in 2003, Freddie Mac Conv 30 year fixed loan at 6.125%. Payment is $1325 month, balance of $166,000. Not 30 days behind but almost alway have to pay a late payment as I pay closer towards the end of the month. Our problem is too many credit cards, which we have cut up and are working our way to getting out of this hole, I called many and have reduced rates so we are on our way out of this mess. Problem is I called CitiMortgage to see about refinancing, they said the loan to value was too high and transfered me to Obama Modification line, they said they can't help because my house payment isn't 31%, it is 27%, so they transfered me to Mortgage Outreach Services to see if they can help. They took all my information and said they would call me in 3-5 days with an answer. Anyone have any luck with this company? I am not behind on any payments on our credit report, we just lived beyond our means while I stayed home with our children and racked up debt, if it weren't for the credit card debt we would be fine. Any suggestions or help would be great. I can give more # info if needed too, like income, etc.

[ls2ls]

crwhart,

Are both of your names on the mortgage? What is your household gross income, original purchase price and current value of your house?

[crwhart]

The loan was for $182,500 in 2003, the balance is $166,000. When I called CitiMortgage first about refinancing she said our house was worth $189,000. But I do have a 2nd with FifthThird that was obtain at the same time as the first, 2003. It is a line of credit that has a balance of $35,000 (that is the limit), payment of $156 a month 5.5% interest only payments we are making to this one. At the time our house appraised for $215,000. if I were to put it on the market today, I would probably list it for $199,000 so I feel what CitiMortgage said was pretty fair. She said our LTV was too high to refinance. That is when she transfered me to the Home Modification department who also said they couldn't help because our payment wasn't 31% of our gross monthly income. Our gross monthly income is $5408, our net monthly income is $4173. I pay $1325 for the 1st mortgage, $156 for the 2nd mortgage and $1056 a month in all my credit card minimum payments. I have $1636 left for everything else (car payment, electric bill, phone bill, etc.) and 3 kids to care for on top of that. I went back to work full time in August 08 so that has helped us not use the cards anymore but I still feel strapped and thought a mortgage home modification for a few years would help us concentrate on the credit cards. Will I have any luck?

[crwhart]

And the home is in both our names. I forgot to answer that part.

[Moe Bedard]

crwhart....................you are in a much better position than most people............both of your payments combined are only 27% of gross income..........the problem doesn't seem to lie with the mortgage..........as that is a low debt to income ratio.

Have you tried working on modifying your car payment with the auto loan carrier if that is high................or working with a debt management counseling agency such as CCCS to get the credit card balances in check................you may want to try something like that..............most credit card companies will work with consumers on their rates and sometimes even their balances if you are in a hardship situation........
Consumer Credit Counseling Service :: Debt Management Services :: Consolidate Debt

[ls2ls]

crwhart,

As *** mentioned, your combined housing payments are around 27%. So from housing portion of your monthly expenses, you're in a good shape and you should work on reducing your credit card debt (call each and every one of them and ask for a rate reduction).

However, as far as I know, the refinance part of Making Home Affordable program does not have the 31% DTI ratio as an eligibility requirement for MHA Refinance.

Also, according to the MHA guidelines, the LTV (loan to value) percentage can go as high as 105% based on first mortgage only.
In your case LTV is about 88% ($166,000 : $189,000), well bellow the maximum of 105%. (even if they combine first and second, you're close to 105% even taking their "off the cuff" value for your home of $189,000)

So, if Freddie Mac is still the owner of your first mortgage, and you have been current on your payments, I would think that you should qualify for an MHA (Making Home Affordable) refinance.

Since your 1st is already 5 years old, the benefit of refinancing will depend on the new rate you get.

If you still want to go ahead with refinance, call Citi back and ask to speak to a supervisor (do not mention your prior conversation). Tell them that you do qualify for a refinance according to Making Home Affordable (MHA) refinance guidelines and would like to apply for one.

MHA Refinance eligibility guidelines:

"You may be eligible if:

•

You are the owner occupant of a one to four unit home,

•

The loan on your property is owned or securitized by Fannie Mae or Freddie Mac

•

At the time you apply, you are current on your mortgage payments (current means that you haven’t been more than 30-days late on your mortgage payment in the last 12 months or, if you have had the loan for less than 12 months, you have never missed a payment),

•

You believe that the amount you owe on your first mortgage is about the same or slightly less than the current value of your house,

•

You have income sufficient to support the new mortgage payments, and

•

The refinance improves the long term affordability or stability of your loan."


.

[crwhart]

Thanks for the information, I will call back. The person on the phone from Mortgage Outreach Services said I didn't qualify for the Obama Modification since my ratio wasn't over 31% but they said I might qualify for a traditional modification and said they would call me back in 10 days after reviewing all my information. I plan to make my June payment on Friday so I won't and have never been more than 30 days late, usually around the 20-25th of the month, I pay it. I know my problem is the credit card debt, I just was looking for a modification for a few years so we could focus on the credit card debt. We have no plans to sell our house so figured that might be our best option.