Advice Please. VA Loan

[erilee]

Hi,

I have been reading the posts here on loansafe for about a month now. A little background about my situation. We bought in California 2007 for 339K. A new community and a new home. Husband's income now has shrunk 20% so as of now, our mortgage including tax and insurance is 51% of our net income. We refinanced through the VA streamline in February since no appraisal was needed. This saved us about 200 dollars a month because escrow payments went up about 70 dollars (but total loan went up 351K due to VA fees and refinance fee). We have a 5% fixed and we are very happy about it. According to zillow the home is worth 230K but foreclosed home sold for 150K. Now, my husband is a union construction worker and got the notice that he will be laid off by the end of July. Got the notice early June.

June 1st I applied for the Hardship Assistance Program with Citi. Last Monday I got a letter stating I was denied. While waiting around for citi I also started the NACA process. Submitted on June 20th and I am still "pending". Called Citi Executive Team today and spoke with Allan. He was nice. He told me that I have a VA Loan with a VA Investor so there is not much they could do. He also mentioned I only made 4 payments so I would have to wait until I have made 9 payments to contact again. SO I called the VA Regional Office. They told me that since CITI owns the Note that there is nothing they could do. I asked who should I contact to see if CIti would waive the requirement of making 9 payments before a modification could be asserted. She said she doesn't know.

We are not late on payments. We have a wonderful 5% fixed rate but here is the catch. So on our little block of 15, 4 homes have foreclosed and our neighbor has told us that he did not pay for 6 months until the bank lowered the payment by 1000. The empty homes that were left (that were never sold in 07) were bought by investors within the last 6 months who rent them to Section 8. So here I am having my husband commute 120 miles a day to hard work and I stay at home with my little one while I hear rap music and base up and downt he street knowing that they pay pennies to what we pay for the same homes. The only difference, we own they rent.

We didn't want to ditch our property and add on to the economic mess but I"m starting to feel discouraged and thinking of throwing in the towel. We LOVE our home but not enough to make this payment run our lives by eating whats on sale at the super market - or not going anywhere by saving gas money. We live in the desert and there is not much to do unless you drive to LA. So my question is, what would you do?? Also, the local news reported that our area suffered a 71% delcine in home value in comparison to 2007.

I think it would make sense if Citi did a 2% fixed for the life of the loan. That would be a 1731 payment still over the "ideal payment" NACA submitted of 1450.

Any thoughts or advice would be great. I need fresh new ideas since I have been biting my nails and thinking about this for the past month now as my husband leaves me as the acting CFO Thanks.

[jonahstephenson]

Well, in my opinion, the bank does not want to take on your property that has lost 70% of its value. And if they do, they might even get less than that in a short sale or auction. If you are thinking about walkin away anyway, why not play the odds of just not making your payments, possibly force Citi's hand to work with you? I am in the process of a MOD for similar reasons, if they had told me there was nothing they could do I for sure would have made them prove it... if you get me. Just my opinion of course.

Jonah

[erilee]

Well, I talked to guy from Citi Executie Team and he told me that since I have a VA Loan and the VA is the investor there are not many programs out there for me since I have a 5% and that the market rate for a VA is at 5.7%. I contacted the VA regional office and was told since CITI owns the Note I have to comply with Citi. I just wish Citi would work with me instead of waiting for us to default!!! They just want to make things harder for those who aren't struggling as much. Thanks for your opinion Jonah.

[jonahstephenson]

No problem. And I completely relate about wanting the help before defaulting, as that is what I am trying get done with Citi, right now. But you have to think of it as if YOU were the money grubbing bank/investor on your note. They dont care about your hardship, only thier money. And why not get as much from you for as long as possible, they only want to help you when you default because then they draw nothing from you otherwise.

You mention loving your home, but willing to walk away. As some one on here advised me... you have to wiegh out your options, saving your house but going into defualt to do it... even then, its not a garuntee they will help. I wish you best the best and keep your progress posted.

[TXCajun5]

I have the situation with Citi.......and I am at a losstoo. Does anyone have any further advice on this?

To make matters worse in mid June a rep. at Citi told us to move and get a renter in our house. Because the missed mortgage payments are above what we can afford to pay all at once and right now. So, we moved into a rental and have have our mortgaged home leased out for the next 24 months.

Now Citi says that they never said for us to do that, and we have learned that we are now in default on our VA loan.

We did what they told us to do, now they say it is a VA loan and they are not willing to modify the loan because we are not living there.

Advice?????

[maggieb]

They told me Today V.A modification would be at 5% but that I had to pay all late fees etc and have 15 days to come up with over $2000 , I thought a modification they could roll all that up in the back of the loan, When did this change for V.A ?

[TXCajun5]

Hi Maggieb,

I'm not sure on that, but I was under the impression that type of mod. sent everything to the end of the loan. Maybe late fees are different....


Did you get that information from the VA or from Citi? Also, have you contacted the VA Servicing Center? They have to review every loan prior to foreclosure. I e-mailed the VA over the weekend, and they are already looking into my situation.


Keep me posted on what you find out, and I will do the same. Good luck!

[maggieb]

Do you have a link or contact number for the V.A ? Also another company called Trident Holding called me about modification. I might call them and see what they say. Thanks

[maggieb]

Got my information from Citi Yesterday, but initially they told me all fees would be rolled into the back of the loan, Now it changed. Confused