Impac/cw-loan mod approved

[notasmartowner]

Hello,

I had our loan mod approved from CW.

I will put this very simply.

NOW:
Total loan $800,000
Current value of house: $500,000
1st loan @ 632,000 at 5.6% set to reset in 2012. Mortgage pay @ $2900

LOAN MOD:

632,000 at 3.6% set to reset on 2014. mortgage pay @ $1900

suggestions?

[notasmartowner]

Maybe the reason I am not getting any replies after 18 views is that i have not provided details.

I am on a time sensitive schedule so I will surely share ALL the specifics of my situation. I am working directly with CW w/o attorney so I was just wondering that if their offer is "as best as its going to get" w/o an attorney?

thanks.

[LHarveyMadman]

Good rate, but you unless your home increases in value significantly by 2014, you will still be far underwater at that time.

You might want to consider being a little patient as you wait for the answers you desire. You posted your second message in this thread just 83 minutes after your original post. Some of those who viewed your message might not be persons with answers, but who have questions and were drawn to your subject line that indicated success.

[MUCHO]

One suggestion I would have is to think long and hard about your long term future because as already mentioned the value is not likely going to be back even 5 years from now.

Another consideration is that your second lender will likely be willing to settle for a fraction of what you owe if your second is a non-recourse loan. (If you can get your second lein holder to settle then you're much less underwater.)

Overall there are many variables involved that you have not revealed making it difficult for anyone to give you any kind of real advice.

[notasmartowner]

Thanks for the suggestions folks...

here is a copy of another post i had made in these forums:

"We bought our home for $800,000 back in March '07.... Myself and my wife bring make about $130K/year (before taxes) We have $5K credit card debt, a $400 car payment and the normal utilities probably around $1000/month (i am being generous)

We took a dumb step and bought the house, of course with ZERO down and 5 years ARM! thinking we will refinance in 2012 when the house is worth WAY OVER 1 mil (Or that's what our Loan officer and Agent thought also)

Well we had 5 foreclosures literally down our street last year and they went for $450K to $550K....!!! More are on sale for avg. $500K.

Our mortgage payment is about $5K (tax and insurance included) and is divided into a 80/20 first and second...first is $640K with Countrywide at 5.625% till 2012 and second is $140K with Wamu at a 15/30 at 11%!

My student loan kicks in next year and there is no way we will be able to afford the house when the payment resets in 2012 since there is NO WAY the house will get its $300K back in 3 years...those days are gone..."

...so now i replied back to CW and asked if there were other "LONG TERM AND NON-ARM OPTIONS" available. I think they wont do principal reduection but may tinker with the interest rate.

My concern is that if I re-sign with another ARM (although save me $60K for next five years) I still have the worry of loan reset in 2014. Home prices are falling everyday...and I will not make up for the 40% loss in 2 years back in 5 years to refinance. Who knows what governemtn policy is in effect at that time.

Should i take the offer or push them for a more extended and permanent rate cut? I dont want to lose what they have offered now.

[LHarveyMadman]

Virtually all of the modifications that have a changing interest rate are not ARMs in the traditional sense. They typically fit the following pattern:

1. Very low rate fixed for 5 years, followed by
2. A step up in interest rate to a higher rate after this initial low rate period.
3. The rate increases by a known amount - for example, increasing by 1% a year to a maximum rate, at which point it never changes again.

Read your modification offer again. I'll bet that's what you have been offered. And I wouldn't be surprised if your maximum rate is 5.6%.

[notasmartowner]

Thanks Madman,

Here is the current status:

The Company will not budge from their proposal since i am showing temporary hardship (as opposed to Job loss, Death, Divorce etc). They will decrease my current int rate to 3.6% till 2014 which will save me $1000/month. In 2014 the int on the first will go back to the fully amortized 3% int rate + LIBOR (at that time) LIBOR will reset every 6 months thereafter not to increase or decrease 1%. Not willing to give me fixed or Principal reduction.

They will wait for my answer by THU. I am leaning towards agreement to save $60k in the next 5 years while I am trying to workout with WAMU/CHASE on my 2nd.....

Good deal?

[LHarveyMadman]

It's a good deal for the first 5 years; after that, it's a crapshoot because it's an ARM again. Impossible to say what your interest rate might be. It could be quite a bit higher.

As was already mentioned, even after 5 years at the lower interest rate, you will still be upside down by a lot. With the uncertainty in your rate, I think you need to consider whether it's worth your effort (and money) to keep paying for a home that you won't have any equity in for a very long time.

[notasmartowner]

thanks for the advice and comments!

Here is my issue.... I pay $2000+$1500=$3500 (1st and 2nd mortg)
and still hope that WAMU may decrease or eliminate (one can dream) the second $1500/month payment NOW and get my nice TAX refund from uncle sam every year to cover my prop taxes or leave and rent for $2500 ONLY and no tax refund with a horrible credit.

Yes..i hate the "unknown" of ARM in 2014...but my choices are limited....

[LHarveyMadman]

Where are you located? Since your second loan was purchase money, then it might be non-recourse debt. That means that if you were to walk away from your home, WaMu would get nothing from the deal and would not be able to sue you for the amount you owe. I think there's a link floating around here that has information about specific states.

If yours is non-recourse debt, then you would be in a better position to negotiate with WaMu. I don't want to give you any unwise or uninformed advice about how to go about doing this, but if WaMu gets the sense that you might be walking away, they might offer to settle your debt for a much smaller amount. They'd rather get a little rather than nothing. Someone here was offered to settle a second for 10 cents on the dollar. If I find the link, I'll post it.

[LHarveyMadman]

By the way, if you settle your second for less than was owed, it might be reported as such on your credit report. This will have a negative effect on your FICO score, though not as damaging as a foreclosure.

[notasmartowner]

SO i have been working with the investor on my loan, IMPAC, all this time and they have approved to the mod BUT with a $1995.00 fee. The fee is not negotiable and cannot be added to the principal balance. They IMPAC rep did tell me that after the payment, i will rcv the actual addenedum to my original loan from CW in 4-5 weeks...to be signed and sent back for the new payment to refelct on MAY 1st.

If i try to go direclty with CW....can that save me $1995? WIll they work with me under the Obama plan as IMPAC stated that they are not receivng any bailout money so no go on the new govt. plan....

[Dan Bailey]

CW would most likely offer you the same exact terms since they are bound by the investors decisions.

[notasmartowner]

Thanks Dan!

Here are some updates:

Since we sort of figured out that IMPAC seems to be almost a middleman (is this a incorrect presumption?) since they want the $2000 and will not add to the loan....I called CW this morning and spoke to a very helpful and nice rep.

He took down ALL my Financial info (income, debts etc.) and listened to my sob story. He stated that they will have more info on the new housing act by the end of this month and at THAT time it is "possible" that i can be helped??? He did say something that really irritates me..."you have been current for the last 2 years as opposed to being late...which matters"

I am being a pessimists un-trusting ****** because i have already have been bitten once by a bad loan and judgment...I just don't want to make this mistake again....should i just pay IMPAC the $2000 fee and let them handle this....does Countrywide STILL need to approve this after they get the info from IMPAC??

BTW...these forums and the help is incredible...Keep it up!

[StayStrongMom]

i also have a loan with CW and just received a letter from impac. i am VERY tempted to call them as i have gotten nowhere with CW. having read your thread i am curious if anything else has happened with your story? please keep us updated... and good luck!

[bradR]

Originally Posted by notasmartowner

Thanks Dan!

Here are some updates:

Since we sort of figured out that IMPAC seems to be almost a middleman (is this a incorrect presumption?) since they want the $2000 and will not add to the loan....I called CW this morning and spoke to a very helpful and nice rep.

He took down ALL my Financial info (income, debts etc.) and listened to my sob story. He stated that they will have more info on the new housing act by the end of this month and at THAT time it is "possible" that i can be helped??? He did say something that really irritates me..."you have been current for the last 2 years as opposed to being late...which matters"

I am being a pessimists un-trusting ****** because i have already have been bitten once by a bad loan and judgment...I just don't want to make this mistake again....should i just pay IMPAC the $2000 fee and let them handle this....does Countrywide STILL need to approve this after they get the info from IMPAC??

BTW...these forums and the help is incredible...Keep it up!

I'm toward the end of a Mod with Impac for my CountryWide serviced loan and my understanding is that Impac actually is the lender and CountryWide is the servicer. Maybe somebody could clear that up, if they know anything about Impac?

I payed the $2000 and will make it back after 5 months. They are going to be saving me about $400 a month. For you it would only take 2 months, so definitely more worth it.
Plus, you will have at least one month that you will not make a payment of $2900 and that is tagged on to the back-end, so in a since the fee plus more is tagged on to the back-end. You would not have to pay $2900 and possibly $5800, that would be put on the back-end, so you would be out $2000, but up $900 or $3800 with in about 3 months, plus all the money you would save after that.
For me the way the docs and the new payment start date worked out it will be 2 months, so my $1250 a month for 2 months, $2500 will be put on the back-end. My rate was 6% and Impac lowered it to 4%, so the rate you got was definitely a good deal.

CountryWide will get the info from Impac and then over-night a simple form for you to sign & have notarized, ask for pay stubs, proof of insurance and give you a envelope to over-night it back. It took CountryWide about a month from when I paid the $2000 to Impac.

[notasmartowner]

Originally Posted by bradR

I'm toward the end of a Mod with Impac for my CountryWide serviced loan and my understanding is that Impac actually is the lender and CountryWide is the servicer. Maybe somebody could clear that up, if they know anything about Impac?

I payed the $2000 and will make it back after 5 months. They are going to be saving me about $400 a month. For you it would only take 2 months, so definitely more worth it.
Plus, you will have at least one month that you will not make a payment of $2900 and that is tagged on to the back-end, so in a since the fee plus more is tagged on to the back-end. You would not have to pay $2900 and possibly $5800, that would be put on the back-end, so you would be out $2000, but up $900 or $3800 with in about 3 months, plus all the money you would save after that.
For me the way the docs and the new payment start date worked out it will be 2 months, so my $1250 a month for 2 months, $2500 will be put on the back-end. My rate was 6% and Impac lowered it to 4%, so the rate you got was definitely a good deal.

CountryWide will get the info from Impac and then over-night a simple form for you to sign & have notarized, ask for pay stubs, proof of insurance and give you a envelope to over-night it back. It took CountryWide about a month from when I paid the $2000 to Impac.

Thanks Brad...

Your post was a fresh breath of air for my concerns. I actually did pay the $2000 last week and I was told by IMPAC that the process will take about a month and you are correct about receiving the DOCS from countrywide. Your post made a lot of sense and is inline with what my feelings were.

I hope to post back with more as this process continues. I will be honest with you, I will not be happy and satisfied until I see the $1000 difference on my countrywide bill.

[RAMD05]

Was anybody offered a forbearance agreement for 90 days prior to Loan modification? I wonder what is the trick there. Thank you.

[balto714]

I talk to Aurora Loan Services rep. yesterday and told that my loan modification was approved and that a negotiator will be contacting me in two days. Can somebody tell me what is next?

[overallthisbs]

keep in mind that there are laws in place right now that forgive you on your taxes for the deliquent amount of taxes (federal), in 2012 that law ceases and you will be responsible for the deliquent amount on your taxes if you decide to foreclose after then, something to think about......

[dogatemy]

Originally Posted by notasmartowner

We took a dumb step and bought the house, of course with ZERO down and 5 years ARM! thinking we will refinance in 2012 when the house is worth WAY OVER 1 mil (Or that's what our Loan officer and Agent thought also)

I'm sorry that I do not have an answer to your question but I was wondering to myself.. WHY?? I understand the average joe public assuming values will continue to rise in much the same way they have for the past 100 years. I also believe the rise and bubble would have been prevented if every loan was built on a 30 year fix (which would have limited speculative buying). What I do not understand is how a CEO making $1.3 million dollars a year who is supposed to understand the complex economics of the banking industry allowed someone to buy a million dollar house on an interest only loan?

I'm not an economist but I was bombarded with 'interest only refi' offers touting literally 1% for 5 years with 120% cash out. I remember sitting around the table with friends who make $60,000/year to $100,000/year and deciding this was a bad, bad idea.

My mistake was not following through, stashing the $60k or $80k under a pillow then waiting for the market crash to foreclose. I could have walked away and paid pennies on the dollar.

Okay.. i'm done ranting.

[notasmartowner]

Originally Posted by dogatemy

I'm sorry that I do not have an answer to your question but I was wondering to myself.. WHY?? I understand the average joe public assuming values will continue to rise in much the same way they have for the past 100 years. I also believe the rise and bubble would have been prevented if every loan was built on a 30 year fix (which would have limited speculative buying). What I do not understand is how a CEO making $1.3 million dollars a year who is supposed to understand the complex economics of the banking industry allowed someone to buy a million dollar house on an interest only loan?

I'm not an economist but I was bombarded with 'interest only refi' offers touting literally 1% for 5 years with 120% cash out. I remember sitting around the table with friends who make $60,000/year to $100,000/year and deciding this was a bad, bad idea.

My mistake was not following through, stashing the $60k or $80k under a pillow then waiting for the market crash to foreclose. I could have walked away and paid pennies on the dollar.

Okay.. i'm done ranting.

I hear ya....and completely understand your frustration..I try not to think about the "WHAT IF'S" scenario as much since it only boils my blood and screws up my day....I am one of your $60K-$100K friends who kinda sorta understood what i was getting into but i wished to God that I had waited 2 more years and bought my house $300K less than what i bought back in '07and saved 100K on top..arghhh

I swear if we did not love the area and the house we are in and cared about our credit...we are gone a long time ago...

ok..im done ranting...

[notasmartowner]

Hello,

I received a call from the investor on my 1st, IMPAC, on 2/12/09 and was given a proposal to send my hardship info with other related items. I sent it in and 1 week later i was approved for a $1000 a month break on my first for the next 5 years. (STILL AN ARM)

I had no other option to get something going for our house since i really don't have a severe hardship except the fact that our home had lost 40% of its value in 2 years and our ARM was to adjust in 2012

After a little back and forth and some research on my side (including these awesome boards), i paid the $1995 fee to IMPAC on 3/12 and held my breath.

This week i received the official/actual addendum and loan mod docs from CW through FEDEX. I quickly checked the terms and signed them and returned them today on a CW supplied overnight envelope.

Oddly 2 things have happened which i did not expect.

1. CW apparently is thinking/stating that we missed our 4/09 payment. Although they have deducted it from our auto pay account???

2. They again asked for ALL the docs, HARDSHIP Letter, 1040, Title, Bank Statements etc.

I sent all in and per the loan mod docs, i should have my new payment take effect on 5/1/09.

I am very happy that although its not what i really wanted (principal reduction, no ARM) but at least I will be paying $1000 less for the next 5 years on my first. That's $60K in the bank.

I have already sent all the paper work to WAMU to see what I can do for my 2nd. "crossing fingers" Will keep you posted.

Thanks for all the help.

[notasmartowner]

Its Official!

I made the NEW payment for May last week and checked to find out that CW/BOFA has updated our Online Account info to reflect the new loan mod payment and terms...

Finally...I can rest in piece to know that at worst, I will save $60K in the course of next 5 years when the ARM adjusts again....we'll see then but for now...it works for me.. I had to take the lesser evil as we never had a Permanent hardship situation.

Thanks for ALL The help and assistance from the Forums here....Its has been incredibly helpful!

Now only if WAMU can come to terms and stop being so difficult

[MPDano]

This is a great story with a happy ending. I too have been skeptical on forking over $2k when we are strapped for money. I lost 90% of my savings due to my ARM Reset period. I think this is what I needed to jump start us.