questioning mortgage, is it predatory lending?

[aglick]

I have been lurking on the board and finding lots of information. I am really confused about certain things though, and thought I may find some answers if posted my circumstances. Its kind of detailed and confusing so bear with me.

My husband and I financed a modular home in June 2001. We had talked to the finance company starting in May and we went over details, how much we could afford, etc. We were first time home buyers, very excited to have a new home and very naiive!! Hubby worked in Indianapolis and was only home about 1 weekend a month. So we had to sign paperwork on a Saturday, as that was the only day he could come home. We live 4 hours away from Indy. The branch manager was there with her little boy, they were in a hurry as her little boy had a ballgame to go to and they were running late. (That should have been my first clue, but you really want to trust people who are in the financing business!!) So it was sign here, initial there, and out the door we go. We walked out of the office with paperwork, which was an open-end mortgage and a copy of right to rescind and a great feeling of pride knowing we were buying a new home. No problems or so we thought. It was to be a fixed rate, she highly encouraged us to obtain credit life and credit disability insurance. She was really adamant about it and we agreed. In 2003, they approached us with a home equity line of credit and we decided to take advantage of it, no paperwork once again, no explanation. Sign and go.

Then in 2006, my husband became ill and was hospitalized for 4 months. He is now totally disabled. The finance company 2 weeks into his illness called and saidno problem. We had disabilty insurance and it would pay $400 a month for the next 2 years, huh??? Things were pretty crazy, hubby was in ICU for a long time, and I didn't have the time or energy to stop and think about the situation, ask questions, etc. Was just glad to get the $400 a month at the time, as I had to quit work. After things settled down and my husband was able to come home I started questioning things. We fell behind one month on our mortgage and on our HELOC. I called the branch manager to discuss a few things, and she became quite hateful. Said a lot of things, "that I should be grateful for the $400 a month we would get for that 1 year, they had done us a favor, etc. So what happened to the 2 years coverage. They denied
they ever said that. Questions and arguements went back and forth and the only answer I would get was if I didn't like it they would foreclose!! Ok, so what happened to the credit life and credit disability. Called their main office, they gave me quite the runaround, told me all kinds of stories, but after several phone calls, they "admitted" the credit life and credit disability was not
uploaded into the computer when the loan was taken out. Our house payment went up, no one could seem to tell us why. We also had an auto loan that they kept refinancing, encouraging us to especially at Christmas, so we could buy presents.

I ended up asking for all copies of paperwork from the finance company. Found out it was a home equity line of credit for our home. Found out that we we had a balloon
payment due on 06/2016. The points finance charge was $2245.00 and it was a fixed rate at 11.500% annual percentage rate but computed by applying a monthly periodic rate of .9583% to the average daily balance, a prepayment penalty if prepay the entire amount within 5years penalty is
4% of the line of credit. There is an annual fee of 1% of the line of credit. There is mandatory arbitration. We never received a truth in lending, no settlement agreement. I have called the branch manager several times and she becomes irrate when I try to question her about things and she constantly screams about foreclosure, asking me which day I would like to move out, that she will start foreclosure the next day. We tried to do a loan modification, but I got this huge life story from her, about how she was in a bad wreck, unable to work, lost her house, blah, blah, blah. Of course, since we had to wait almost 2 years for my husbands disability to start, our credit score is really bad. Its hard to make our payments as he is on a fixed income and our income has lowered substantially.

Now I know you all think we must be the dumbest couple in the world because we didn't realize what we were getting into. I feel pretty stupid even posting this, as I look back on the situation, I don't know why we didn't question things and we didn't realize there was more to buying a home and signing and dating a couple of lines. But I feel like we were taken advantage of, they should have been up front and honest. But we didn't have the paperwork until 2006 and had no idea about any of this. So now what do we do. I sometimes think we should just walk away from it, yet I feel like they were responsible for this also. Wondering if there was anyone with any input, advice. Thanks for letting me vent.