Is it really worth the fight?

[Mr.Peabody]

So I'm pretty sure we want to keep our house, but I have this nagging feeling. As of right now we are about $50,000-$75,000 upside down on our home. Sometimes I think it makes more sense to just walk away. Our mtg payment is about $2,400, we could rent the same home for $1,400.

I guess it's a pride thing, not wanting to go back to renting. Not wanting our family to know we gave up our home. Also, we would like to buy a home in the future and it will only be harder with a foreclosure in our past.

I don't know. Assuming you are underwater, why are you fighting to stay in your home?

[jojolala]

Originally Posted by Mr.Peabody

So I'm pretty sure we want to keep our house, but I have this nagging feeling. As of right now we are about $50,000-$75,000 upside down on our home. Sometimes I think it makes more sense to just walk away. Our mtg payment is about $2,400, we could rent the same home for $1,400.

I guess it's a pride thing, not wanting to go back to renting. Not wanting our family to know we gave up our home. Also, we would like to buy a home in the future and it will only be harder with a foreclosure in our past.

I don't know. Assuming you are underwater, why are you fighting to stay in your home?

I completely agree with this. It will be a decade before there is any equity at all, and in the meantime, what happens if over this timeframe you want to move, or have to move?... then you will have to go through the short sale nightmare. What if, for example, a new $15-20k roof becomes necessary, let alone degressionary improvements? Better not add to your red ink.

It's an emotional decision that also tugs at our integrity, but really, this is not our fault and we are dumb to continue to bouy these rotten contracts and play this game opptimist that real modifications will be the result.

[Riley18]

Unfortunately, I am slowly coming to the realization that I will never win this fight. The banks can drag their feet forever with no end in sight. It is a shame the government didn't just streamline this process through Freddie and Fannie, but it will not happen now. The banks are going to horde their stolen money and we are never going to be able to hang on long enough to keep our house.

[mimirayo]

I have gotten to the place where I am more then my house.So What if everyone knows you gave up your house. There are alot of people in your situation, and that neighbor with all the "stuff" is probably in the same position as you.

Why not give up? Because if not you will be contributing to the banks "invincability" you will allow them to "horde their stolen money".

I watched the "money czar" yesterday. He even stated that the "banks too big to fail" are only getting bigger.......what do you think that means? It's not just your mortgage money, but TARP, taxes....any place they can get federal money.

You may think what is a few dollars, one home? Think about it multiply your situation by every home in America...we are talking BILLIONS.Until you stand up and say ENOUGH it will keep happening.

If you need to walk away then you should, but don't keep silent, because when it comes to buying that other home years from now, you may find the situation is worse.

[darkdays]

Originally Posted by Mr.Peabody

So I'm pretty sure we want to keep our house, but I have this nagging feeling. As of right now we are about $50,000-$75,000 upside down on our home. Sometimes I think it makes more sense to just walk away. Our mtg payment is about $2,400, we could rent the same home for $1,400.

I guess it's a pride thing, not wanting to go back to renting. Not wanting our family to know we gave up our home. Also, we would like to buy a home in the future and it will only be harder with a foreclosure in our past.

I don't know. Assuming you are underwater, why are you fighting to stay in your home?

It's a struggle and you have to do what is best for you and your family. It's a long and painful battle which you have to know you can endure. The good news is that the HAMP directives have been updated to require lenders to 1. confirm in writing in 10 business days receipt of a modification application; and 2. make a decision in 30 days. It's not that abbreviated but that's the gist.

[caldwellb02]

It is a struggle. Sometimes it feels like it's not worth it. But we here and others like us must keep at it if we can. If we give up, they win. Again. We are not asking for miracles.

Darkdays - are you sure that HAMP uses the word "require" or is it "recommend?"

[joanne]

There probably isn't one of us that doesn't question this fight each and every day. For me, I look into my 5 year old and 9 year old's faces and imagine telling them that we have to leave our home in a neighborhood that is so wonderful for children and where they have many close friends... walk out the door and you have great friends and parents to play with.

Yes, children are resilient, and they will get over it if it ends up in the worst case scenario. But they won't ever forget, nor will their parents. If I don't try for them, I would never forgive myself.

And, if I never stand up to the fraudulent activities of mortage servicers and alot of government officials, I will be responsible (not solely) for the continuance of such practices and the continued plight of the American Homeowner.

So, I will fight and I will expose what needs to be exposed.

And in the end, I will be able to sleep at night.

[darkdays]

Originally Posted by caldwellb02

It is a struggle. Sometimes it feels like it's not worth it. But we here and others like us must keep at it if we can. If we give up, they win. Again. We are not asking for miracles.

Darkdays - are you sure that HAMP uses the word "require" or is it "recommend?"

I went back to confirm and it says "must" so that is required.

Here is the text from the directive found at www.hmpadmin.com which is dated October 8, 2009 and is effectively immediately.

Servicer Response
Within 10 business days following receipt of borrower financial information verbally or in a completed RMA, the servicer must acknowledge the borrower’s request for HAMP participation by sending the borrower one of the following documents:

1. The stated income TPP Notice -- if the servicer is evaluating borrower eligibility based on verbal income information and is prepared to offer the borrower a trial period plan.

A written notice with information describing HAMP and including appropriate forms and a list of verification documents and a specific date by which documentation must be received -- if the servicer is evaluating borrower eligibility based on verified income information.

1. If the servicer determines that a borrower cannot be approved for a trial period plan, the servicer must communicate that determination to the borrower in writing and consider the borrower for another foreclosure prevention alternative.

Within 30 calendar days following the servicer’s receipt of a completed RMA, Form 4506-T and all required income and other information (including all required documentation and either the borrower's tax transcript or tax return when using the verified approach), the servicer must complete its evaluation of borrower eligibility and notify the borrower of its determination as follows: If the servicer determines that the borrower is approved for a trial period plan, the servicer must either: Send a TPP Notice (verified income) to the borrower, or If the borrower is currently in a trial period plan pursuant to a stated income TPP Notice, send a written notice that the borrower has been approved for a HAMP modification pending timely receipt of all trial period payments. If the servicer determines that a borrower cannot be approved for a trial period plan, the servicer must communicate that determination to the borrower in writing and consider the borrower for another foreclosure prevention alternative.

[Isabel]

Our home is about 110k underwater. I went through the process if I should walk away as well. My credit is in the 800 but then I think is my credit worth 110k. The prices could slowly move up but for how long. do I want to break even if it goes up 10-15 years later. Will it ever break even. And then also 10-15 years, it will cost money to maintain the house.

I am thinking of it like an investment. Is this investment worth it? I have two loans cant refinance and for the bank to try to do a loan modification. They would have to modify my principal by 50%. From everything I read they won't do that so we decided lets let it go. We also cant maintain the house with only one salary and my husband will be losing his job soon since the company he works at has sold. So we made our decision.

You have to ask yourself all these questions and more and decide and go full speed with your decision.

[EstherL]

I can relate! I'm currently under water $300,000 on my home. I'm trying to figure out what to do, as from what I gather, Countrywide doesn't reduce principal. It's especially painful as we put down $270K but I have to wonder when will the value go back to what it was...probably in 15-20yrs? That's a long time to hang on, especially since the school aren't very good where we live (bought the place before our baby was born - not thinking we'd have children). I've been working with Countrywide for 9 months now doing a modification...Friday, I just heard from the office of the president, due to sending an email. Hopefully I'll talk to a negotiator in a week...but I'm not holding my breath...I've gotten the run around so much. Best of luck to you!

[darlyj]

We are trying for a loan mod through NACA because we have not been able to get anywhere ourselves with Chase on the 1st. We have a recourse HELOC that they are trying to work with us on but that is totally separate, at least for now.

We've decided to look at the sitauation this way: Equity is a joke anymore. When you speak of it, people either start laughing or crying. Either way, we are essentially paying rent to the bank at 30-40 percent above market (in our case) which is not financially feasable for us anymore. Plus, if something breaks we still have to pay to fix it rather than call the owner to get it fixed.

Yeah, your credit is going to take a royal beating but it can be rebuilt. We have other debt that we have managed to finally get caught up on after deciding to stop paying on our mortgage. OK, so the bank kicks us out and we rent for a couple of years. In that timeframe we should be able to keep up with and pay off some of the other debt and our credit rating will rebound. We won't be able to get a mortgage through a bank, but someone willing to do an owner carryback very well may work with us, especially if we have not been late with a previous rent payment. We'll pay slightly more in interest but we won't be padding the pockets of a corporate giant with morals in the negative numbers either. Several years down the line from there, we may even be able to refi through a local bank for a better rate.

Every situation is different, and I wish you and your family luck whatever you decide! Just realize that there are options, credit can be rebuilt, and you are FAR from the only one in this situation right now.

[davephx]

Originally Posted by darkdays

I went back to confirm and it says "must" so that is required.

Here is the text from the directive found at www.hmpadmin.com which is dated October 8, 2009 and is effectively immediately.

Sadly they can make all the directives they want but there is no enforcement provision. And in reality this just isn't happening. Servicers are many months behind, understaffed other than sometimes the front line people that can't really get anything done.

For many six trial payments seems to be the norm and than many are denied after all that. There are some happy success stories but too rare and a long, long battle.

[EstherL]

I'm in my 4th month of trial payments. This month, Countrywide decided to put our home up for auction on Aug 29 even though we were doing the trial payments. I was told last week we didn't qualify anymore...so I went and saw a bankruptcy attorney. Once my real estate agent (we have been trying to do a short sale since countrywide is trying to foreclose out from under us) told Countrywide we were going to file bankruptcy...all of a sudden I got calls on my home phone and cell phone that they want to re-review my file. Thank God they have just post poned our auction for 30 more days. I hope something will work...feel like giving up...if I thought they were going to foreclose I wouldn't have messed around with the trial payments.

[darkdays]

Originally Posted by davephx

Sadly they can make all the directives they want but there is no enforcement provision. And in reality this just isn't happening. Servicers are many months behind, understaffed other than sometimes the front line people that can't really get anything done.

For many six trial payments seems to be the norm and than many are denied after all that. There are some happy success stories but too rare and a long, long battle.

Understood but this is a new directive so the people that have been waiting months didn't benefit from that directive. We've seen some movement so I suspect the lenders will start to pick up their pace. They have to because there is only so long their can claim being backlogged as part of their contractual agreement with HAMP as a servicer is to staff appropriately to get through the applications. Seems a few lenders have hired a bunch of new people (just what we needed more uninformed debt collectors) but I read an interesting article over the weekend that talked about how in general a modificaiton request can be reviewed start to finish in just under 2 hours because most of the work is inputting data into the computer. At some point, some attorneys will use this directive to argue that the lenders are dragging their feet trying to milk more payments out of people beyond the 3 month trial period. The 3 month trial period is to determine if the borrower can make the payments by showing consistent behavior for three months. period. It is not 3 months for the lender to get their act together. In fact, under HAMP the intent was for the lender to have everything ready, including the final agreement, upon receipt of the 3rd payment as the borrower successfully ends the trial period on month 3. If the borrower did not make the payment on the final due date, and the borrower makes the payment within 30 days of that date and the lender chooses to accept it on any trial period, the lender must accept it on every trial mod they have and must notify the borrower the agreement because effective on the next 1st day of the month instead of the day they thought it would be.

[aruna]

People are fighting because:

Reason 1: They put a lot of money into the house and they will walk away with nothing, if they short sale or foreclose.
Reason2: They are emotionally bonded, have memories in there, ...etc.
Reason3: Your bank does not co-operate to forgive the prinicpal.

I belong to #3. We did not put a lot of money into our house, and I may walk away without much loss. But, One of our Mortgage is with BofA who I know for sure will never forgive the loan. So, in either case of shortsale/ foreclosure I will have to pay back what I owe on the house. I'd rather keep the house hoping for the market to improve, than to give it to the bank and still pay for collections. We're working on a Loan mod right now, despite the fact that I owe twice than the house is worth.

[miked2023]

this is a good topic and I can certainly relate.

Underwater 150K, house needs 50-100K worth of repairs/upgrades, 50K in credit debt from when my wife lost two jobs. That adds up to 300K I'm on the hook as of right now or I could just ...

Default on my payments, take the extra money to pay off the 50K in debt, save another 30-50K while the house gets forclosed on, and start over renting a bigger home for half the money.

At first I fought to try and save the home, and I'm still going through the motions, but I realized (after months) that it just doesn't make sense. No way is my credit worth 300K. I'm just hoping I get to stay in the house another 6-8 months (my last payment was in May). I haven't received a notice of default yet so I think my prospects are pretty good. My wife and I are at peace with the decsion to walk away. Truly, it was the only thing we could do.

Best of luck to you all.

MD