Walking away in ARIZONA…

[underwaterinAZ]

I’ve been reading this forum for months and it has helped us tremendously with the decision of walking away so I thought it was time to share our story, maybe it can help someone else...

Original loan –June ’05, put $78,000 down, Interest only loan, payments $1,800 month

Refinance – June ‘05, Bank of America, fixed rate 30yr. loan, rolled prepayment penalty in from old loan and took cash out, new loan balance $415,000, new payment $2,980 a month.

Line of credit – June ‘06, Bank of America, put in a pool $60,000, some home upgrades $10,000, balance as of now $86,000, payment $230 a month.

Current Value – Zillow has my home estimated between $155,000 and $220,000 but homes like mine are selling for much less than $200,000 so we are basically under water by at least $200,000 probably more.

I’m a stay at home mom going to school part time and my husband owns his own business. Our lives were going great until the middle of 2008 when work for my husband started to slow down. By November of 2008 new work stopped coming in and we had to lay off employees.

Our first missed mortgage payment was January 2009, and February 2009 for the line of credit.
Calls started the day we were late and kept up for about 3 1/2 months, on and off sometimes every day and sometimes once a week, I always answered and told them the same thing …Sorry we don’t have the money, maybe next month… The line of credit did send someone out to the house in April saying they did not have my contact info but I had just talked to them the day before. Now 6 months in and all the calls have stopped. We don’t want to do a loan mod we just want to move on from this upside down house. We still have not received a NOD nor have any idea as to when we will get one. We would like to get out soon as we have kids and want to be settled in a new home and have this behind us. We know we are responsible for the line of credit and hope we can settle with them down the road.

Anyone else in AZ with Bank of America and have gone past 6 months without a NOD?

Also I am wondering how hard it will be to get a rental home with our credit in the toilet because of a foreclosure…

I will keep you up dated as time goes on…

[countrywideh8r]

I'm in AZ and have BofA (formerly countrywide).

My last payment was December 1st, 2008. I called them today and the girl said the NOD filing was "imminent". She was also incredibly rude to me (like always) and asked why I was even calling that number when I know I don't qualify for President Obama's plan (the 31% thing)

Basically went something like this:

Me: "Hello, can you tell me if there is any information on my file in terms of a foreclosure date?"

Her: "Are you calling about the new President Obama plan?"

Me: "No, I just want to know if there is any information on my file about a foreclosure"

Her: "Is your payment more than 31% of your gross income per month?"

Me: "No, it's not."

*blah blah blah* more useless talk, I still don't have my answer, and she's getting more agitated

Her: "So why are you even calling us if you've already decided to hurt your credit and your neighbors by walking away from your house"

Me: "I just wanted to know if there was a sales date posted or any information about that"

Her: "No, there's not."

Me: "Ok thanks."

Her: *click*

Gets me all riled up every time I call them... I actually called twice today; once to ask about cash for keys and got a similarly rude response.

[AZChick]

check the maricopa recorded documents page, put in your first/last name, if there is a trustee sale yet, you'll find it there.

[underwaterinAZ]

Well there is not much to update other than there has not been much movement on my loans. B of A (HELOC) still called about once a week, one lady in particular was working my account, she asked to speak with my husband, when I told her no I was the one dealing with all of this she got all huffy and has since not called back. 3 days later we get a letter from her saying unless we bring the account current within 5 days they will accelerate collection activity to protect the banks interest. The letter was dated 7/21/09. We have not had any calls or letters since then.
As of now we are 8 months behind on the first with B of A. No one has called and no letters have been sent but today I got a flier on my door with the 800 846 2222 on it saying to call them. The lady said my account was in review for a mod and transferred me to Home Retention services where they told me they did not have any of my info (because I never gave it to them) and they were unable to give me any more info. So I called the first lady back, I just wanted the status of my account like when they were going to proceed with the foreclosure but she only told me I was past due and they have the right to foreclose at any time.
So it’s a waiting game… We are at 8 months past due now I am amazed that they have not filed the NOD by now. I am checking the county records and have yet to see anything posted. It’s nice not having to pay but on the other hand I would love to just move on and get this behind me…

[gravymark]

that is EXACTLY how I feel. I just want this to be over with and move on! My original auction date was July 27th and after a week of checking the county recorders office I called GMAC's trustee sales department and they said the date has been moved to August 31st at my request. I was like whatttttt...!?!

Anyways, more waiting and hopefully this time it goes through.

[Corrina]

Originally Posted by underwaterinAZ

We would like to get out soon as we have kids and want to be settled in a new home and have this behind us. We know we are responsible for the line of credit and hope we can settle with them down the road.

Also I am wondering how hard it will be to get a rental home with our credit in the toilet because of a foreclosure…

First, you live in AZ... rental houses are a dime a dozen. My sister is in RE doing prop. mgmt. and most of her renters are people from the same situation as yours.

Since you mention that you would like to get out as soon as possible why don't you find a house to rent and just mail the keys to them. My sister did just that... she moved in late June and by the end of Sept. the house was taken back. She just made sure she took pictures and enclosed them w/keys to show that the property was left in good shape. Just a thought... that way you can move on.

[Under_H20]

Originally Posted by Corrina

First, you live in AZ... rental houses are a dime a dozen. My sister is in RE doing prop. mgmt. and most of her renters are people from the same situation as yours.

Since you mention that you would like to get out as soon as possible why don't you find a house to rent and just mail the keys to them. My sister did just that... she moved in late June and by the end of Sept. the house was taken back. She just made sure she took pictures and enclosed them w/keys to show that the property was left in good shape. Just a thought... that way you can move on.

Is that a legal option? I would think that until the deed is transferred in some fashion, you would be liable for the home even if you mailed in the keys.

[Corrina]

Typically, once they know that you are no longer in the home they will come right away and have the locks changed. I am assuming that this is a conventional loan so they can accellerate it. Lets face it.... Arizona is one of the top three states with foreclosures yet when you read (esp. on this site) it is clear that lenders are stalling when it comes to helping us with our options.

My sister lived in an older neighborhood and like you she took out money for personal issues. Her loan was at 200K and when she mailed in the keys it was valued at around 95K. The bank took it back 70's range (can't remember) and it was listed for the longest time at 59K. It finally sold for 39K. A short sale wasn't something she wanted to do. She just wanted to move on with her life and is now living in Chicago. Legally, people are not supposed to default on their debts also but when things happen out of your control what can you do? I would imagine that from the banks perspective by you mailing in the keys you are in turn saving them $$$ because they don't have to go through all the legal jumbo to get you out, etc.

Since you don't want to stay there anymore why don't you call them up and tell them that you can no longer afford the home and what is the process and where do you mail back the keys? FYI... my sister also had B of A.

Another thought though... since you don't want to stay in the home anymore why don't you try a short sale. If you are successful with that you can have a Fannie Mae backed loan after 2 years (a foreclosure is 5). Also, with a short sale I have been told that only a late payment will show on your credit report and after it is sold it shows as paid or negotiated. There was a very good article in the South Mountain District News (July issue) on the pros/cons of short sale vs. foreclosure. southmountaindistrictnews.com

[grmeyer]

Has anyone looked into doing a Quit Claim Deed? This will get you off the title and supposedly off the hook for the HOA, property taxes and liability. This liability thing is unkown and annoying. AZ has deficiency statutes, however, these other things are outside the loan agreements.

[Corrina]

A Quit Claim deed will only take your name of the title bearing any interest in the property, however it does not take you off of the loan responsibilities. If the person who the Quit Claim is given to defaults on the loan you would inturn be responsible since your name is still on the loan but not the title. The only way to get your name off of everything is to do a refinance (from what I have read). I would imagine that since taxes are 1st in line as far a liens they could still come after you if the loan for the "property" still has your name on it. Though I am not sure of the HOA since they would be far down the totem pole if the property were to go into foreclosure.

[grmeyer]

With the Quit Claim Deed, yes, I am only off the deed. But, in this case, that is a enough. Being off the deed removes me from the tax liability, hoa fees and personal liability.
The loan is the least of my concerns at this point. In some cases, the lender has given notification of foreclosure and 11 months later, nothing else has happened. If you are not in the home and it is vandalized, someone better have insurance on the property. If the HOA puts a lean on property, and it is subsequently sold at auction, you still owe HOA. oops!
I do not want to declare bankruptcy.

[underwaterinAZ]

Update
About a month ago the bank called and I found out my loan went from Loss Mitigation to the Collections department. Today BofA called, they said my loan was reviewed for foreclosure on 10/1/09 and the NOD was filed on 10/5/09 but I don’t see it on the county web site as of yet, with my sale date set for 2/9/10. Seems like they are giving me longer than the 90 days I thought we would have from NOD to sale date.



By February we will have missed just over 1 year of payments. As much as we want out of this loan and knew this was coming after I got off the phone with BofA today it all became so much more real and somewhat scary. Knowing this won’t be our house for much longer kind of freaks me out.



They still call about the HELOC that we have with BofA. They are talking about a settlement now. The first offer was 60% for 5 years with payments around 880 a month then he went down to 40% 10 years no interest with 300 monthly payments. The next time they called they went down to 30%. I would like to work with them before they sell it off but don’t know when that will be and I am worried about the tax consequences for the amount they write off, the balance is around 85K now.

[AZOwner]

underwater, have you looked at the Countrywide settlement judgement on the AZ AG website?

[we're_still_reviewing]

Originally Posted by Corrina

Another thought though... since you don't want to stay in the home anymore why don't you try a short sale. If you are successful with that you can have a Fannie Mae backed loan after 2 years (a foreclosure is 5). Also, with a short sale I have been told that only a late payment will show on your credit report and after it is sold it shows as paid or negotiated. There was a very good article in the South Mountain District News (July issue) on the pros/cons of short sale vs. foreclosure. southmountaindistrictnews.com

Can they come after you for the deficiency ? I thought I read that you could be sued for the difference ?

[we're_still_reviewing]

Originally Posted by underwaterinAZ

Update
About a month ago the bank called and I found out my loan went from Loss Mitigation to the Collections department. Today BofA called, they said my loan was reviewed for foreclosure on 10/1/09 and the NOD was filed on 10/5/09 but I don’t see it on the county web site as of yet, with my sale date set for 2/9/10. Seems like they are giving me longer than the 90 days I thought we would have from NOD to sale date.



By February we will have missed just over 1 year of payments. As much as we want out of this loan and knew this was coming after I got off the phone with BofA today it all became so much more real and somewhat scary. Knowing this won’t be our house for much longer kind of freaks me out.



They still call about the HELOC that we have with BofA. They are talking about a settlement now. The first offer was 60% for 5 years with payments around 880 a month then he went down to 40% 10 years no interest with 300 monthly payments. The next time they called they went down to 30%. I would like to work with them before they sell it off but don’t know when that will be and I am worried about the tax consequences for the amount they write off, the balance is around 85K now.

I'm so sorry that you and your family are going thru this. It is scary. I agree. We will be walking away from our home as well. I, too, think about our credit and finding someone who would rent to us. Have you found out any information about that ?

Take care

[freedspirit]

underwaterinAZ,
I am a homeowner going to Trustee Deed sale tomorrow 10/13/09! bought house June 2006 at $210k. Owe $185K (1st/2nd). Haven't paid 1st & 2nd since Nov 09 and house was in SS since Jan 09. BofA closed out on several of our sales contracts without informing us while we're waiting around for the SS approvals. We just got denied for SS again 2 weeks ago - BofA blamed Mortgage Insurance for denying sale (which might be true since our negotiator offered us a deal of accepting the SS at $88k + $15k sellers contribution). Bottom line:
#1 - you'll have no problem renting a new home for a lot less than what you've been paying. Just be careful that the new landlord is not soon-to-be going under as well or you might find yourself having to move several times!
#2 - You can negotiate your BofA 2nd down to even lower. On another property, I was told they were authorized to approve 40%. I didn't accept. It became a 'charge off' on my credit report. My attorney then negotiated some more. I showed my husband's medical bills (mental illness from stress) and also foreclosure letter of my primary residence. They accepted my $100k HELOC (which became $104k with unpaid interest) at $12k! You got a lot more wiggle room - but need STRONG hardship letter and proof that if they don't accept YOUR offer (start at $6k), they'll pretty much get nothing since your house is gong into FC anyway.

I'm surprised you got the NOD before your FC Trustee sale! I thougth they'd come collect from you only AFTER they're done with sale, so they know how much to collect from you.
Can anyone advise?
Any last minute tips from ANYONE to one going to the gillitin tomorrow??

[freedspirit]

Originally Posted by grmeyer

With the Quit Claim Deed, yes, I am only off the deed. But, in this case, that is a enough. Being off the deed removes me from the tax liability, hoa fees and personal liability.
The loan is the least of my concerns at this point. In some cases, the lender has given notification of foreclosure and 11 months later, nothing else has happened. If you are not in the home and it is vandalized, someone better have insurance on the property. If the HOA puts a lean on property, and it is subsequently sold at auction, you still owe HOA. oops!
I do not want to declare bankruptcy.

Hi there,
Your info. on Quit claim - is that what AZ county tells you?
My Trustee sale is tomorrow, which means BofA is taking over.
There is a tax bill that was due 10/1/09 but 'late' 11/1/09 - will this bill now be for BofA to deal with? I've been up to date with my HOA dues.
Is is too late to file a Quit Claim since sale is tomorrow and deed will be BofA by then anyway? I'm in California.