unwilling landlord

[prman]

Hello, I have been reading all the comments and suggestions on this site and was hoping somebody could give me some advise. In 2005 I bought a house in Virginia. I was relocated by my employer and bought this house as my primary residence. The house cost 410,000, so I got a first and a second mortgage. The first was an Interest only pay option arm with CW for 328,000. The second was originally with CW, but since they raised the rate soon after I bought the house I re-financed it with BB&T also an interest only loan. The rate on my first is a 5.6% interest only arm that is set to adjust in August of 2010. The second is set at prime for the life of the loan.

In 2007, my employer re-located me again to Dallas, Texas. I tried to sell my house because of the housing market being what it is, my house is now valued at approximately 320,000. Since I needed to get into a house in Texas as soon as possible I went ahead and purchased a house here and put my house in Virginia up rent. The rent currently covers most of the first, but not the second. Not to mention the property taxes, HOA fees, property management etc.

I am the sole income in my family of four and every little bit matters. I contacted CW and initially they told me there was nothing I could do since I wasn't delinquent on my payments. I told them it was a matter of time, but they didn't care. They told me to try and short sale it. I then went ahead and sent e-mails to the CW people that are named on here on loansafe and I got somebody that was willing to take down my financials. Her name was jacqueline. A week later Jacqueline called me and told me that I didn't qualify for a loan mod mainly because my backer (Freddie Mac) was aware that I wasn't delinquent yet.

Does anybody have any suggestions of what I should do? Luckily I make a good income now and I have a renter in the house, but, soon the renter will be out and I can't afford to cover both mortgages. I told CW that but they didn't care.

Any help will be greatly appreciated.

[tandm]

Unfortunately, now the home in Virginia would be considered an investment property and not your primary residence. When and if the banks are willing to help someone, it is with the primary residence. A short sale may be the best way to get out and not harm your credit with all the lates first. A short sale will also hurt your credit but if you don't pay and then short sale, it would be worse. Or try to get another renter and weather this storm through.

[prman]

Thanks, for the advise. I was hoping there was someway there were other options for me. I realize I'm not as bad off as the others on this forum, but I am definitely barely getting by. If I lost that renter, I would really be hurting, not to mention the loan is going to adjust in 2010. Thanks for responding.

[tandm]

You probably already tried this but if not, try googling something like...
can't afford mortgage on my investment property - what are my options
and see what comes up.

What about a lease option for a future renter? You could ask for more rent and a larger deposit and there might be some out there willing to try that with you.

[prman]

I will try googling that. I never thought of the lease opt thing. But , it definitely something I'm going to research. Thanks again. My wife wrote a letter to the Washington Post regarding the fact that Freddie Mac only would work with us if we were delinquent. She got a call from the Washington Post asking if they could post her letter in the Sunday edition. I believe they should try to be pro-active and help those who are willing to try to continue to pay as long as they can, instead of saying we aren't going to help you until you default. Am I wrong in thinking this way?

[tandm]

Of course - that's only logical. But the banks aren't acting in a logical manner at this time. It gets worse - we were recently told by our loan mod firm that countrywide doesn't like it when borrowers are paying their credit cards and not their home loans. They feel like the first thing that should be paid is the house and that the credit cards should be the last. Hmmm... yet they won't work with you until you're late on your home loan.

Back to why the banks aren't acting logically - I do think it has something to do with the overwhelming amount of requests for modifications coming in. But I also think there is something to the fact that the bank can be sued by the investor if the investor doesn't like the modification. Otherwise, why the safe harbor clause in the bankruptcy cram down bill in the senate now?

[prman]

That makes sense. Thanks again for all the advise and allowing me to bend your ear. I'm going to keep trying to do the right thing, although it gets harder and harder each day when I see and hear what is happening to all the good people out there. Thank god for all the good people on this site who give advise and try to help others. The banks and backers who only think of their bottom line will reap what the sow.

[tandm]

prman -

I just read a post *** made on a recent thread - she may have missed yours and I may have steered you wrong. She said...

"Hi simon2020,

Welcome to the forum and thank you for joining................

Countrywide is modifying investment properties too...........the modifications given are up to the investors on the loan so you would need to contact CW and see what modification options the investor on your loan will allow............"


... so perhaps you may be able to do something with that initial home of yours. Good luck.