Reduce my Principle or NO PAYMENT! [FL]

[Love Doctor]

Stats:

• New home built Oct 2006 (Builder Bowen Homes)
• $ 220,000 Total (Fixed 30yr 80/20 = 2 loans total)
• Lender = Country Wide
• 1st time buyer w/ untill recently 720 credit score
• 100% financing
• Central Florida
• Payment $ 1,946.00 per month

After much diliberation, I've decided not to make any further payments until Country Wide reduces my principle to fair market value! I've never missed or was late on any payments, and to make a long story short I simply unplugged them from my check book. This is to serve as a documentary of what happens month to month.

Follow me as my story developes for better of for worse.

• Last payment made was Oct 2008

Here is what I have done so far:

• Submitted a hardship letter
• Submitted a letter to stop collectors from calling me
• Submitted my financials
• Submitted my terms

Here is what I have recieved so far in response to the above:

• (1) Late Notice Letter on a monthly basis
• (1) Letter indicating the acceleration clause to being (Dec/08)
• (1) Letter indicating the foreclosure process to begin (Jan/09)

PEACE-

[sandyh]

Was your loan a subprime loan? I'm not sure if Countrywide would consider a reduction if your loan was a conventional fixed rate....it is unfortunate, but houses are investments and as such can go up and down. It would be good if you could find something that was not right in your documents....that might help. Good luck with it - I'm sure it is very stressful.

[SereneDean]

Originally Posted by Love Doctor

Stats:

• New home built Oct 2006 (Builder Bowen Homes)
• $ 220,000 Total (Fixed 30yr 80/20 = 2 loans total)
• Lender = Country Wide
• 1st time buyer w/ untill recently 720 credit score
• 100% financing
• Central Florida
• Payment $ 1,946.00 per month

After much diliberation, I've decided not to make any further payments until Country Wide reduces my principle to fair market value! I've never missed or was late on any payments, and to make a long story short I simply unplugged them from my check book. This is to serve as a documentary of what happens month to month.

Follow me as my story developes for better of for worse.

• Last payment made was Oct 2008

Here is what I have done so far:

• Submitted a hardship letter
• Submitted a letter to stop collectors from calling me
• Submitted my financials
• Submitted my terms

Here is what I have recieved so far in response to the above:

• (1) Late Notice Letter on a monthly basis
• (1) Letter indicating the acceleration clause to being (Dec/08)
• (1) Letter indicating the foreclosure process to begin (Jan/09)

PEACE-

Hi Love Dr - I can completely understand your choice. I've been considering not paying another dime until & unless CW & CitiMortgage respond to my plight in a way that is satisfactory, ie: principle reduction....What have they done with that $45 BILLION infusion they got? Why are they waiting(stalling) until APRIL of 2009 to utilize H4H? We'd all be sure to get a quick response & improved service if all of us CW customers TOTALLY STOPPED SENDING THEM A DIME & put a fire in their pants. The reason they won't even consider working with me is because I am not behind on anything (yet)....they're gettin' their $$ but by April, I don't know if my head will still be above water...Here's a link to a post & a good thread of info.
Click here: No Hope for Homeowners at CW till April 2009 - Loan Modification Forum - Loan Safe

[jojolala]

Sandy, I don't agree that you have to have a subprime loan and do agree that you need to take issue with the loan process... a good place to start is with the appraisal. It's great if it was done by LandSafe. Also if there were last minute change in terms delivered by a friendly loan officer who told you no docs required. In my case I was still living in another state and did not have employment in the city that I was moving to. Call it a liar's loan, but we have a 30 year track record of paying a mortgage and knew we would be employed in short order once we got here. Call it a liar's loan, but we were prodded to make these misrepresentations just to get the loan to go through. The conservative reader will probably say that we are not as entitled to modifications as the hardship stories of lost employment, injury &

[jojolala]

...oops.. injury & illness. But we paid for a false appraisal. We heard so many times over the years in the Bay area, how the loan officer told the appraiser "what they needed". It wasn't even considered shady, except now in hindsight. At the last minute we were told to pay off this credit card or some mysterious change in rate after being "locked in". I remember a day when an underwriter would turn you down and that was that. Sorry for rambling...

[Love Doctor]

I can rent a bigger home for $ 900.00 less then my mortage. Multimillion dollar business or going out of business in my area, restraunts are closing every few months, jobs are dissappearing on a weekly basis, the mall is starting to look like a ghost town.

The industry did everything they could to fill their pockets with such inflated prices and mathematical loan practices that when I was looking for my 1st home for my family of 4, I had to participate in a lottory just to be considered to purchase a home from the local builders. And now, we are so top heavy that the ballon has deflated and the industry is coming down hard.

This is not what I signed up for. This is not an investment. This is fraud, borned from greed and loose practices. This is what we all get for let it ride on like it did.

Not another dime from me. It's time to clean "House", and for the very first time of being a home owner, my house is finally paying me. I'm building up my savings by refusing to pay my mortage. In fact, the money is piling up in a safe.. since I don't trust the banks a whole lot anymore.

This may not be for everyone, but I'm 33 and my credit will recover a hell of a lot faster then this financial hurricane we are created in some way. All in all, I will be better for it.

PEACE-

[Jonas]

I’m on board with this logic (REDUCE PRINCIPLE OR NO PAYMENT) for many of the reasons expressed by L-DOC. I could mathematically say that it is in the best interest of CW/Investors to look beyond loan mods (dressed up refi’s) and offer true mods with reduced principle, based on fair market value. CW will NOT be getting another dollar from me until I see some RP.This is either going to be a win win or a lose lose situation for me, and if I lose (no RP),I will be situated to immediately rebound. Keep us posted L-Doc.

[jojolala]

I am so on board with this approach. I would rather bank my mod payment and risk having to find new digs. Either they are going to reduce my principal or I am walking away anyway. We are months away from foreclosure as we are just on the first month of our early workout temporary mod. Another comment regarding the news on the Merrill Lynch $10b in bonuses handed out during the holidays (while I was sweating it out on hold with CW... ho,ho,ho). If BofA would seize that money from the ML execs and use it to pay for truly modifying all of the CW bad paper, they would have money left over. Get all of us off their phones and stop all this innane paper shuffling.

[Love Doctor]

As much as I would like to remain in my home during this headed Foreclosure process and save money, I opted to rent another home and just leave this one behind. If it was just me living in this home, I would simply prop up my feet on the coffee table and wait this whole thing out....

However, I have a family to think about, and need to get re-established elsewhere. Therefore, I signed a lease for a much bigger home for $ 750.00 less that what my mortage is going for.

I will continue to and try to get some "Real Resolution" from CW in hopes that maybe I could get a good enough reduction on the principle and interest so that I can rent it out to someone else at a realistic payment that reflects "Today's" prices.

PEACE-

[MP927]

Love Doctor--I am thinking the same thing. Getting out now and renting while our credit is still "decent". We have a family to consider too; and the decision is so difficult when you have others to think about.

[luisren]

Love Doctor, if you don't mind me asking, what is the square footage of your newly built home? What is the APR on your 30 yr. fixed loan? What area in central Florida (I'm in the Tampa area)?

[Love Doctor]

On a side note, when I was looking to rent a home, I was ready to put down 1, 2, 3 or even 4 months deposit since I figured my CW would destroy my credit... However, when I explained my situation to (5) different rental places, they told me not to even worry about it and I ended up paying the regular (1) month deposit like normal person would have to.

I almost didn't even have to explain much or even go into the details I've disclosed here... I then realized that what is happening to us all has become common knowledge to the point that we all have realized that we are all in this together in some way.

Additional Home details:

Square footage is 1,876 living
4 bedrooms
2 bathrooms
3 car garage

30 year fixed
APR of 6.5% on the 1st loan (80%)
APR of 9.0% on the 2nd loan (20%)






PEACE-

[jrolfedrev]

My plan C was the same thing rent a home which I can save a lot of money ($2300 for 3300 plus sq ft compared to $4000/mo mortgage) than buying the CW mortgage. On top of that I do not have to pay the California property tax, insurance and association fees.

[Teamhockey]

I agree withthe principle reduction theory. I have read for hours blogs, etc. re: this however and don't see that being done by lenders. When they consider they will be losing the money anyway to foreclosure why not keep people in their homes and work out some reasonable agreement? These lenders need to consider each situation and how much they will lose on a foreclosure. It is an incredibly expensive procedure from the lenders standpoint. I think one problem is that they have talking heads who don't know how to think doing the work. The people I have spoken with at Countrywide have less knowledge about loans than my 11 year old. I was in the mortage business for 32 years and find this mass stupidity on the part of Countrywide disgusting. What is B of A doing with all the bail out money they have received? Put it to good use. Let's see some accountablity of funds. Perhaps it could be used to do these principle reductions.

[serenevenice]

Teamhockey, just my 2 cents worth....... the banks (CW) when there is a principal warrented, are selling the servicing to another party to avoid a mod and principal reduction. My AG, govenor and congress people are worthless.

So I too am now looking into rentals. I'm starting with all the new construction that has been sitting vacant for the past 2 years. If the news is correct (they haven't been about all the help for us distressed homeowners) you can make your own deal with them without first and last or security deposit and get a few months free. We'll see how that goes.

[serenevenice]

I might also add, that now our 800 credit score from September 2008 is now 530 thanks to the good ole boys at CW What's to loose with a foreclosure?

[pdsfoley]

I agree with all of you... I was being way too attached to my home...home is where you make it. I've waited so long for the stupid AG mod. I'm sick and tired. Its not worth the stress anymore. I work at CW and STILL can't get anywhere. maybe if all their customers "walk" they'll do something. Its insane. Our credit is gone too...so we're all in the same boat. It just seems to me that if they weren't so greedy and actually got these mods done WITH the principle reduction, it would be a win win for everyone...they get money and we get to stay in our homes...is that just too EASY of a solution??? Or am I missing something??

[luisren]

I can relate to the credit scores - I went from 700's to 550's because of CW late payments. I don't even care about my FICO score anymore. How is it that my mortgage loan can qualify as predatory but my payments need to be on time whilst working it out?

[Love Doctor]

I listed my home for sale for what I bought it for. If a buyer would come along and attempt to purchase my house at my asking price, their banks would 1st do an appriasel... which would come back $ 70,000.00 too low and therefore, they would not get the loan!

I'm getting a phone call every few days from an Agent of CW from the "Presidents Office". They keep asking me to give them financials over the phone... I told them to put a deal on the table we both agree on first, before you look over my financials because in reality you are nothing but a "Sales" call to me and I'm not inclinded to be purchasing much of anything at the moment.

I go on to state what kind of deal I would entertain... "A short sale to myself."

PEACE-

[Yanqui]

Speaking of short sales I found out that my property that I financed at 415,000 would most likely sell around 160,000 at auction.

[Love Doctor]

Principle Reduction to fair market value is the only real solution here. Not more cleaver loan programs dressed up as Aid or a bailout.

We have to be real and call it for what it truely is... a game of financial hot potateo that went unregulated for way too long. Its time to get real.

And don't get me started on the county tax appriasals being used to calculate our taxes... they are $ 55,000 too high in my area compared to true market value.

PEACE-

[Yanqui]

CARSON, Calif. (KABC) -- A Carson resident is holding a one-man protest. He recently lost his home to foreclosure. Tuesday, he took extreme measures. He says he wants to buy the house back. The man recently lost his job and then found some new work.

Rooftop protest: Man wants his foreclosed house back - 2/10/09 - Los Angeles-Southern California-LA Breaking News, Weather, Traffic, Sports - abc7.com

did not no where to put this. happened yesterday.

[Love Doctor]

I placed my house up for sale with a company and we have received a call on it today. The potential buyer has offered $ 130,000.00 on my home that is listed at $ 220,000.00. The buyer says he is ready to offer more, but wanted to start the negociation on this short sale there.

Here is my question:

I'm on the hook for the total sum of $ 220k, the appriasal is about $ 150k. The Bank is going to work hard to get as much of the $ 220k as possible and this new buyer is going to work hard to pay as little as possible to secure a great deal for himself. The Realtor will get a % of whatever deal gets agreed upon... This leaves me to face the difference left over (Short Sale) to deal with.... Shouldn't I get some money out of this too?

I'm thinking if the buyer is going to get a great deal by paying say $ 70k less then what I paid for it 2 years ago, then should I ask for like $ 2,500 on top of whatever deal he shakes from the bank? The Bank gets some money, the buyer gets a great deal and I stand on the sidelines picking up the difference?

Thoughts, comments welcomed...

PEACE-

[jojolala]

My two cents are No Dice. Of course people will come out of the wood work with those low offers. Stick to your guns, and either don't pay or get a forebearance, but no way should you get caught up in that transaction.

Did you see the link yesterday to the LA story about the man whose home was foreclosed and he is trying to buy his house back at the foreclosure price?... he's not crazy.

To date, you don't sound like you are in dire straits, and reading the news today, I believe it will be another 45-60 days for an across-the-board adjustment in interest rates and likely principal. The news also says they've extended the moritorium on foreclosing.

These dogs will have their day soon! Say thanks, but no thanks to that offer.

[DAVetran]

Shouldn't I get some money out of this too?

By your previous post, it sounds as though you did.