Mortgage companies and H4H success!

[franklinco]

Originally Posted by Newman

P.S.S. (Or something like that)

Spoke to my loan guy today, as some of the comments had me worried....i.e. NONE of these loans have been done yet.....here is the explanation I got....

> He said that yes, he knew of at least two that had been done through his office, and as this is still such a new program, that is not a worrisome fact. Also, that these loans take 30-60 days anyways, so, not hearing from the lender yet, while frustrating, is still par, as the lender is inundated with requests.

>He also said this, and listen up folks...this program is NOT for everyone, is not a free for all, and has strict guidelines. Not a whole lot of folks are going to qualify, mainly due to income reasons. This program seems to be a bailout for folks who have an income, that is verifiable, (remember those stated income deals? Now you gotta prove what you stated, turns out a whole lot of people can't) (Go figure) Seems to be a program for employed folks (Talk to Circuit City about that one...Sigh) But the gyst of it all is this....if you lied about your true income for the original loan, and most of us did, to varying degrees, why are you surprised when your real income, the income you can prove doesn't qualify you for the loan??? All that according to the loan officer, I'm still on the fence about it....

Now for the loan, for those of you still wondering about this program.....

1. This is not, NOT a FICO driven loan, rather a loan based on your circumstances, i.e. in or near foreclosure. Ability to repay, and debt to income are also factored in. FICO is only a factor in reference to APR.

2. It is a short refi, based on 90% of your appraised value on your home. 85% to pay off your existing loan, 5% for closing costs. Nothing, so far, out of pocket. But, according to my lender, the window for these loans is narrow, and not a lot have gotten through it yet. According to him, I have. I wanna see it on paper, so I asked him for a letter of pre-approval, he said I would have it by Tuesday, Monday Maybe. Time will tell. Dad always says, "Trust, but verify" , so I am doing just that. If I get it, I will scan it and post it up on here if I can, just to show those that are contemplating this program it is real.

I wish, I really wish there were better news out there, so many folks on not only this board, but all over the country are hurting, Circuit City is closing all remaining stores Starting next week, thats 30,000 people on the street, awful, just awful. So, just this, my prayers are with those of you struggling to find a way through this, as I am, I have no guarantees yet, only words, and that we may all find our way to the other side of all of this, and get through it, and then vote Barney Frank out of office.

Best to you all, may the good Lord Bless and keep you, I'll be back with an update as I can....Newman

Thanks for the update. Also thanks for the information on FICO not being a determining factor.
I do not have to fear stated income. I made what was asked at the time the house was financed.
My problems are that my house was in foreclosure, I went into chapter 13 which pulled it out of foreclosure. Our debt/income ratio for March 2008 met the criteria for both the need to refinance and the ratio after the 90% equity loan would have been made. The broker who helps people refinance in chapter 13 just received the information when I called him back in October 2008. Previously I tried to get a refinance but the loan had about $200k of debt on it and at the time my credit was 480, 500 and not rated because of inactivity. He said to refinance I would need a minimum of 580 for anyone to refinance the loan.
If the legislation does not get passed shortly which I am looking forward to, I may need to check into the H4H possibility again since he was saying a 580 minimum FICO.
About Barney, this H4H is partly if not mostly one of the voluntary alternative plans for rescue of the housing market. I don't follow his proposals too much.
I like Brad Miller's plans better and Richard Durbin secondarily.
Any legislation from the mudpuddle is probably going to be such a circus that most will not be able to jump through the flaming hoops and come out alright.
Someone mentioned that they are trying to set up the hoops already and then light the hoops and say we tried, sorry it did not work.
Thanks again for the update.

[franklinco]

Clarification, if you had equity in the house a chapter 7 could have required a sale of the home to pay creditors. I believe state to state your exemption is different and you would lose big in some states. Other states it would well cover the home with the exemption.
Also the judge would not allow a secure claim to remove the debt unless you surrender the collateral to the lender in full satisfaction of debt. In chapter 13 it is currently like this or pay back the loan at the original predatory conditions. You do get to make up the missed payments in the plan over the 3 to 5 years depending upon your plan length. (Under state median income 3 yrs possible, 5 years for over median income debtors.) I was under median income but needed to go 5 in order to pay back secured debt including the missed house payments.
Also sorry for SLS, I meant to post SPS as you mentioned.

[Newman]

Frank, in Ca. if you have no equity in the house, you are allowed to keep it...only reason to sell it would be to create capitol to pay off existing debt...not gonna happen here..LOL...

[franklinco]

Originally Posted by Newman

Frank, in Ca. if you have no equity in the house, you are allowed to keep it...only reason to sell it would be to create capitol to pay off existing debt...not gonna happen here..LOL...

I understand that if your home is worth more than your allowed exemptions it could be sold off to pay creditors. This is the same if a car was worth more than a loan.
What I don't understand is if you have no equity it means you owe more on the loan than the value of the house. Since both a house and a car are secured by the loan, it means whoever made the loan gets the secured item.
If you were able to keep the home and write off the debt in CA, houses in CA would be worth moving to the state.
I'm not sure what you are saying about the bank not getting the home.

[Newman]

**************UPDATE!!!!!!!!!!!******************* **


SPS sent over the payoff, got it today...

Balance owed is 440,, payoff is 243,000!!!!!!

(Reflect the above number as 270,000 actual payoff minus 10%=27,000=243,000.....not too shabby, huh?? Bank has been screaming for a commitment, we could not do that without a payoff from the bank, now we can move forward and put this thing away....

[garyys]

Good news Newman! Read back through the post and didn't see details. Were you late? How late? If not, was it just a hardship?

What did you mean by the bank was screaming for a commitment? This was an in-house principal reduction (the bank SPS is still service the loan, or did it change hands)?

Congrads,

Gary

[Newman]

Gary, loan was origianlly First Franklin....sold to SPS in Oct. We had a hardship last year, got behind on the mortgage, were never able to catch up. I was looking for a loan mod when the guy I was talking to recomended this. So this is not a modification, this is a short refi, which gets me away from SPS altogether. (Not a bad thing, trust me.) So the bank, the NEW bank, was wanting to get us locked in, thus the commitment, but we were not able to due to the lack of a payoff amount from SPS. Got that today, now I can commit to the new lender, get the appraisal done, and sign docs here soon, hopefully within 30 days.....

As an aside, I understand there have been a LOT of negative feelings about certain aspects of the H4H program, not least of which is the equity sharing part. But that is a small price to pay IF, you are terribly upside down in your house, AND, your credit would prohibit you from qualifying elsewhere in a conventional loan. Again, this is NOT a FICO based loan, it is based on your situation. From what I have heard, not a whole lot of folks are getting into the program, but then, there are a LOT of people out there who did stated income loans and lied about thier actual income, so no one should be surprised when they can not prove the income they stated. Those are the vast majority of folks not getting through the gauntlet on this program...BUT, loans are being done, and are starting to close.....it's a 60 day process at least.....best to you all.......

[Catherine]

Dear Newman,

I hope I understood you correctly? My lender is First Franklin/Home Loan Services. I too live in California. HLS instructed me to get approved for an FHA loan to short refi my house, however at the last minute they denied us with nothing but lies and a major run in circles way of doing business. Since our loan adjusted in November we have not made a payment. Would filing a Chapter 7 allow me to keep my home? Thank you so much for your time, Catherine

[garyys]

Thanks for all the details Newman,

I am working on the same thing, short refi using a new lender to qualify for the H4H program. My home was 320,000 in 2005 80/20 aurora/emc adjustable in 2010. The same houses are selling and appraising between 90,000 to 115,000. Those house are in better shape than mine. My loan was done as a stated income (my lender did it without my knowledge, figured it out when I was looking at refi-ing). I am attempting this on a hardship, not late, but had a reduction of income and I am draining my savings. The mitigation company dealing with everything submitted the docs, and I should be hearing more in about ten days. If this goes through I am worried about the appraisal, my house will not meet FHA guidelines (sewer, gutters, paint, ect) the best I can tell. I will see what they say if the time comes?

As far as the negatives, If i read this correct, i think you can just refi out of this loan and be done with it (wait a year, you will lose the equity that was gained from the refi if the market continues going down, save up some money and refi out of the terms)? Even if I have to split the equity/appreciation, its well worth it, you can see ho the value of my house has declined.


Thanks again Newman, I think you are one of the first to actually get a H4H approved!


Gary

[Newman]

Catherine, let me do some research for you before I answer your question...I am just a homeowner on here like you, I drive trains for Amtrak for a living, I'm just a regular guy, and I don't have an answer to your question but I will.....what I do know is this....

Chapter 7 is a financial mulligan, where you basically say goodbye to everything you ever owed on, under certain conditions, you can keep stuff...

Chapter 13 is different, there, they put you on a repayment plan, and you pay the court back monthly till your done...I believe it is a 4 year time frame...also, if I understood what I was told, you pay 10% on the balances you owed on, then you are done.

I if I understood correctly from my atty, that if you have no equity in your home, you may keep it. I just forget if that is for 7, 13, or both. Also, you have to be under a certain amount to file chapter 7, I believe that number is around $63,000 or so, before taxes. Thank Biden for this, he led that takeover of the credit system a few years back, making it harder for people to file. No coincidink that his district is Wilmington DE??? Or that his son sits on the board for one of those banks....in any case, I'll get you an answer.....I would post up my atty's number, but I believe that is not allowed...right?


Also...everyone...BIG BIG BIG battle shaping up on the hill this week re. BK judges being allowed to reset loans from the bench....last congress could not push it through, this congress it looks likely, which would send these arrogant, useless, world class a$$hole bankers running scared...those of you with impending doom from foreclosure, keep a close eye on the hill for the next few weeks....your salvation might be a vote away.....best to you all, may the Lord Bless and keep you..you are all in our prayers.....

[Newman]

Gary wrote..

Thanks again Newman, I think you are one of the first to actually get a H4H approved!

Thanks Gary, but I haven't signed anything yet, I won't breath a proverbial sigh of relief until I do...but this I do know...loans are going out...or starting to...

As for you, the stated income thing is going to hurt you....get yourself a GOOD BK atty, and stand by the pull the nuclear option if you have to..this IS the only thing you may have available to you in order to save your house...what will it do?? It will get rid of that 2nd and give you some breathing room.....it may boil down to this...but hey, by that time, judges may be redoing loans from the bench, and you may walk out of court laughing at them all the way home, a fitting end to your whole debacle....don't be afraid of bk, I would rather be in a home with bad credit than " In a van, down by the river" with good credit.... best to you sir...

[Moe Bedard]

Newman,

You are correct...........about posting contact info.........it is against the tos of the site that is sponsored by the attys on the homepage so that members can join to get advice and assistance for free..

[Newman]

Thanks ***, I have seen what happens to folks that do that, though for other reasons...I did not want to take the chance....zero tolerance policy and all.....LOL.....

Newman<--------smarter than the average bear, but not by much....


P. S. Your attys are more in touch with the field of mods, this was a BK thingy, same thing or diff?? If needed, can I give out my email so she can contact me offline?? Or....will the zero tolerance axe finally put me out of your misery...???

[Moe Bedard]

that would be the stick a fork in you and you are done........

That is the beauty of this forum...........because of the sensitive nature of the posts and stories we are an anonymous forum...........if this member is in the same state as you and wishes to have this information, you are more than welcome to email it directly to me and I can forward it to the member.....

***@loansafe.org

by the way.............I know you have not received the docs as of yet........but I am really happy for you that the H4H is moving forward so you don't have to live in the van down by the river...........did you ever find out who the investor is on your loan that is willing to take the short payoff? That will give other members some hope here..............we are hearing that CW will be on board in April for the loans that they own.

[Newman]

Oh, and somewhere along the line I beacme a senior member?? I prefer Senor Member.....

[Newman]

*** wrote.....


did you ever find out who the investor is on your loan that is willing to take the short payoff? That will give other members some hope here..............we are hearing that CW will be on board in April for the loans that they own.

No, I never did, and they would not ever tell me who they were. I did ask though, and they said this and that, but never anything I could use...like I said, I finally realized SPS was a dead end street, and hit the ground running looking for an answer I could use...make no mistake, if this does not pan out, and that is always possible, I do have an attorney in my hip pocket ready to go and pull the trigger on the BK.....someone once said, " A man has to know his options" I know mine, everyone should.....else doom setteth in.....

[garyys]

Stated income thing has not hurt me as of yet (knock on wood). I know the specific details of H4H prohibit it, but I think I have been successful (so far) at showing that it was not my choice to use stated income. I don't think the BK attorney "IS the only thing you may have available to you in order to save your house". I like your quote above, I think its more accurate, " A man has to know his options". I think I have a lot of options before I get to the BK attorney. My credit is almost 800 right now, I know it has gotten tighter, but I could always buy a second home and try to rent this one out. The money I would use for the BK attorney I could use to buy out my second. There are many other options out there, just trying to resolve it the quickest, cheapest, easiest way.

Did you at any point do a QWR? If you did, did that include specifically asking for the investor? Curious if they would respond to that request?

By the way, I think you can post this with out getting the fork, what company is buying your loan?

Thanks for keeping us updated, and for sharing your knowledge Newman

Gary

[Newman]

Stated income would only hurt you, as it has hurt so many others, if you could not prove the income that you claimed you made on the original loan, if you can do that, then you would have no problem with H4H...I mentioned that as a reason that so few of the loans were being written...you sir, with an 800 score have vastly more options than most, good for you. I would think you could go get a loan anywhere and be done with this whole miserable business.....H4H should be a way for you to go..so long as you can back up what you stated as income on the original loan.....loan is an FHA loan...have gotten the GFE so far, we are scheduling the appraisal at this point....

[Moe Bedard]

Newman is correct about the H4H and the income having to be backed up for it...................

One of the key criteria that is preventing many from getting past the application process alone is the following:

The homeowner did not provide materially false information (e.g., lied about income) to obtain the mortgage that is being refinanced into the H4H mortgage.

[Woodland Hills Worrier]

I have been followed events as best I can. Lots in the news today about the battle raging to allow bankruptcy judges to re-structure mortgages. This is the stick that gets the lenders/servicers off the hook with the investors in the bundled mortgages. You don't have to actually go into bankruptcy since lenders would be more willing to re-structure principal with borrowers to avoid the bankruptcy decision. So it would be the breakthrough borrowers have been waiting for, and the "cram-down" the banks have been dreading.
What *** wrote is very intriguing: we are hearing that CW will be on board in April for the loans that they own. What does that actually mean. I have first and second with Countrywide and also am part of BofA settlement regarding Countrywide predatory lending. Yet, we can't seem to get any movement out of Countrywide. Also, some comments regarding ability to keep home in Chapt 13 in CA if it is underwater. Not sure about that one. Can *** or someone clarify? We are trying to figure out what happens next so we can make reasonable plans. Thanks.

[Moe Bedard]

unfortunately for the answer to that you would need to ask it of the bk attorney.

[Catherine]

Thank you so much Newman for the reply. I spoke to a B/K Attorney's office manager this morning to inquire if filing a Chapter 13 could get my loan modified. I hate doing it, but my lender does NOT play nice.

[Newman]

KAtherine, filing ch. 13 will NOT modify your loan, rather it would freeze it at it's current rate, and if you are behind on your payments, put you on a payment plan to repay those and any other debts you may or may not owe....this is why I call it the "nuclear" option...not only will it blow the lender out of the water, it will do that to you also....but, you will survive, unlike the lender, who goes back to the office empty handed...do not be afraid of this, it is, and will be, the only way to save your home if they go after it for real....

[Newman]

Oh, and Catherine, they will never play nice, this is business, leave nice at the door, be a b!tch....as Shakespeare wrote, " Cry havac!! And loose the dogs of war!!!"

[franklinco]

Originally Posted by Newman

Catherine, let me do some research for you before I answer your question...I am just a homeowner on here like you, I drive trains for Amtrak for a living, I'm just a regular guy, and I don't have an answer to your question but I will.....what I do know is this....

Chapter 7 is a financial mulligan, where you basically say goodbye to everything you ever owed on, under certain conditions, you can keep stuff...

Chapter 13 is different, there, they put you on a repayment plan, and you pay the court back monthly till your done...I believe it is a 4 year time frame...also, if I understood what I was told, you pay 10% on the balances you owed on, then you are done.

You put in a repayment plan according to your income and different debt classifications. The length of plans is three years minimum if you are below median income and five years if you are over median income. Google "doj median income" for the income table. The amount that you pay to unsecured creditors varies according to what is considered expendable income. The amount can vary anywhere 0% to 100% depending on what your expendable income. Above median income people have to fill out a form where the amount of money that you made in the last six months is used as income (not your present income). Then the form for allowances for debt are used from other tables that can be found if you google the site that I listed above. Below median income debtors can choose to file chapter 7 or 13 and do not have to fill in all of the additional information that those that are above median income need to file. You also need to get an approved financial counselor to get a pre-petition evaluation.

Originally Posted by Newman

I if I understood correctly from my atty, that if you have no equity in your home, you may keep it. I just forget if that is for 7, 13, or both.

In chapter 13 you are paying back your debtors in a wage earner plan. I'm not positive on the effect of equity but it would most likely not effect the other creditors. Unlike chapter 7 which the funds to creditors come from property. The chapter 13 is from your future wages. The amount that you pay out monthly for housing would determine the amount unsecured creditors get as a percentage.
In chapter 7, each state has exemptions for housing. If your equity does not surpass your states allowances then it would be exempt from other creditors.
If you do have equity in your home not covered by the exemption, I believe you have to pay creditors the equivalent of the equity or sell. I'm not a lawyer so they can cover specifics of the laws for equity in homes. Who has equity right now?

Originally Posted by Newman

Also, you have to be under a certain amount to file chapter 7, I believe that number is around $63,000 or so, before taxes.

It varies from state to state and also depends upon the size of your family.

Originally Posted by Newman

Thank Biden for this, he led that takeover of the credit system a few years back, making it harder for people to file. No coincidink that his district is Wilmington DE??? Or that his son sits on the board for one of those banks....in any case, I'll get you an answer.....I would post up my atty's number, but I believe that is not allowed...right?

Biden is a moron when it comes to BAPCPA since he voted with the majority of Republicans. At least the President voted down the complications. The comments about Biden are most likely justified. No matter, the whole act added to the cost of legal help, complications for judges, trustees, debtors and the like. Hopefully the damage can be undone that the 2005 fiasco caused.

Originally Posted by Newman

Also...everyone...BIG BIG BIG battle shaping up on the hill this week re. BK judges being allowed to reset loans from the bench....last congress could not push it through, this congress it looks likely, which would send these arrogant, useless, world class a$$hole bankers running scared...those of you with impending doom from foreclosure, keep a close eye on the hill for the next few weeks....your salvation might be a vote away.....best to you all, may the Lord Bless and keep you..you are all in our prayers.....

If you want to track the laws being worked through congress, there is S.61 in the Senate and HR 200 and HR 225 in the House.
Also there is legislation that passed the House, HR 384 which sets guidelines for the second half of the TARP which also includes foreclosure moratoriums, Servicer safe harbor from lenders and loan modification similar to the one the FDIC worked out for the closed down banks in their control.
Hopefully help is on the way.