We have been trying to get a modification (HAMP) for a year now from Citimortgage. We finished a 4 month trial period this last December. We paid the modified amount in January and then we were told that we were denied because we have too much equity. They appraised our home at 403K and our first is for $345K. I informed them that we have a HELOC for 103K, so we do not have any equity. I've been told by some Citimortgage reps. that a HELOC doesn't count, others say it does. They said they would put the numbers in the "tool" again and we are waiting for an answer. So does anyone know? Does the HELOC count or do we really have equity?
That was my main question, but here's the rest of the rats nest we're in and we are looking for some guidance. Our income was cut in half two years ago (reason for mod), we have gone through all our savings, retirement, and credit to keep our home. Now, we have been waiting for this modification, if it comes through we will be able to make the payments. We have been strongly considering bankruptcy and trying to keep our home. We've been told to wait until the modification is made permanent before we start the bankruptcy process.
We have an affordable home which means that if we want to sell it we have to offer it to the county first for $278K (we owe $448K on it, including the HELOC). We considered a chapt 13 (after mod.) and lien stripping the HELOC, this would only happen if they considered the county buyback amount of $278K as the value of the home (so the HELOC would be totally unsecured). If we did get a HAMP modification because we have that HELOC (and therefor no equity) would there be any issue if we then turned around and lien stripped the HELOC?
If the HAMP falls through, does anyone know how long a traditional modification would take? Would it be similar terms to the HAMP? Our original mortgage payment was $2,350 and HAMP amount was $1,515.
Thank you for any help!
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