Credit Cards and BofA (BAC) Loan Mod. - Loan Modification Forum

CuteSanity · 11-03-2009, 06:12 PM

Credit Cards

1) Chase - Balance $4,700.00 (APR 27.24%) Past due 2 months going on 3

2) GE Money Bank Sam's Discover - Balance $8,200.00 (APR 27.97%) Past due 1 month going on 2

3) Credit Union Visa - Balance $1,900.00 (APR 10.90%) Current

4) Kohl's - Balance $750.00 (APR 21.90%) Current

Total credit card debt: $15,600.00

Student Loan
Nelnet $13,500 (2.480%)

Autos
Paid for

Mortgage
Lender - Countrywide now B of A BAC
Fannie loan
No PMI
No Homeowner dues

Past Due: 3 months Received a letter of intent to accelerate
Payment: $1,398.66
Balance on loan - $149,000.00
2009 Proposed Property Taxes Market/Assessed Value- $132,504
Property taxes this year will be from $1480 to $1540.
Our insurance is high (Florida) but I don't have the exact figures right now.

We bought the home for $197,000 in 2005. Put $35,000 down.
Current eappraisal $155,000
Current Cyberhomes $121,000

There is a house similar to ours for sale right now. It is listed at $150K and has been on the market over 100 days. I think they will be lucky to get $135K.

In August of 2009 I contacted B of A. After asking me some brief preliminary questions I was told that I was eligible for a MHA mod. I had 72 hours to fax them my tax return, unemployment benefits letter, bank statements, and hardship letter. I sent this info in time. They never sent me any paperwork to fill out, nor have I heard a response yet. I have since however read online that we won't qualify because my husband's unemployment won't/didn't last 9 months. Also, I read in the newspaper that it can take banks up to 6 months to process a mod so maybe they are still working on it?? Doubtful, as I received a letter last month stating that I may be eligible for a MHA mod.

Here is the current situation:
My FIL asked us to come live with them and take care of MIL who had terminal cancer. He stated that he would pay our bills while we did this. Both my husband and I were unemployed so we agreed. We also were able to have that time with MIL before she passed which was priceless. We have been here several months.

FIL ran into some financial problems a couple of months ago and was unable to pay many of the bills (credit card payments and mortgage payments).

FIL is now in the position to help us get caught up.

However, we still have some problems. We won't be able to leave FIL and return home until next month. We are praying that there will be work there when we get back. Once we get back and are gainfully employed I plan to contact BofA and try to get the mod done.

We HAD a years worth of mortgage payments in savings. Actually we had a lot more than that in savings so I could work part-time from home. That money has been exhausted and was used to keep us afloat as long as it did.

If we can get our loan modified we can make the credit card payments. But the house comes first.

Questions
1) FIL has agreed to pay off Chase - Balance $4,700.00 and GE Money Bank Sam's Discover - Balance $8,200.00 if I can get them to settle for about 30%. Would the creditors even entertain this idea? How would this effect my loan mod?

2) Would it be better if I tried to get the credit card companies to lower my interest and monthly payments? Will they even do this?

3) Should I catch up with my past due credit cards minimum payments or wait for them to settle? or will they send them to collections? (Once I catch up, I probably will not be able to make the minimum monthly payments if I make the mortgage payments so I will behind again).

4) How would bankruptcy effect my loan mod? I don't want to go bankrupt but am not sure what will happen if we pay house and not credit cards.

5) I plan to catch up on August and September mortgage payments. I might even be able to pay Novembers but I will not have Decembers.

6) FIL wants us to short sale our home and move here. Long story ... he has cancer as well, wants my husband close to him, etc... But I don't want to short sale/foreclose unless I can't get my loan modified. Would my bank even entertain a short sale?

7) When my husband is working he makes about $3200 gross monthly. I was self-employed but currently there is no work in my field so I will be trying to get a job as a cashier or something similar at night while he is at home.

I'd like for our mortgage payment to be no more than $950. I think we can afford that. How much combined income do we need to make the payments about that? How are debts counted? I don't want to be turned down because we don't make enough money or that we owe too much debt.

My SIL was recently turned down for a mod stating that she didn't earn enough money. She works two jobs (since her husband passed) and is always one monthly payment behind. GMAC told her that she was about $500 short so she rented out a room in her house for $550 and reapplied. She hasn't heard anything yet.

Please let me know if you need any additional info.

flagirl4444 · 11-03-2009, 09:29 PM

For a payment of $950, you would need about $3k/month income. I would try and settle with the past due credit cards. (just be aware that they will send you a 1099 for the amount they forgive, which may be considered taxable income depending on your situation). You may have more luck settling once they are more than 3 months past due and charged off, especially if/when they are sold to a collector. Either way, I don't think it will have too much bearing on your loan mod but it's hard to know. It looks like you are slightly underwater, so that would probably work in your favor. (too much underwater can increase the likelihood of redefault and makes a loan mod less attractive to the lender, and too much equity makes the foreclosure more attractive as well). If you sent the application back in August, they probably lost it. I doubt they are still processing it. Definitely call and try again, but you will need to have sufficient income to support a payment, whether it's the $950 you want or even less.

flagirl4444 · 11-03-2009, 09:37 PM

I just did a quick calculation, and if your balance is $149k and they do the maximum lowest of 2% at 40 years, your principal and interest payment could be as low as $450 per month, plus your taxes and insurance $250ish? for a total payment of $700/month without having to forbear any principal. There are a lot of unknowns, but if that scenario is possible then you would need to have a gross income of just $2300 to support that payment.

davephx · 11-03-2009, 11:37 PM

For consumer credit cards its 180 days till required to charge off.

11-03-2009, 06:12 PM	#1 (permalink)
CuteSanity Member Join Date: Aug 2009 Posts: 6 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Credit Cards and BofA (BAC) Loan Mod. Credit Cards 1) Chase - Balance $4,700.00 (APR 27.24%) Past due 2 months going on 3 2) GE Money Bank Sam's Discover - Balance $8,200.00 (APR 27.97%) Past due 1 month going on 2 3) Credit Union Visa - Balance $1,900.00 (APR 10.90%) Current 4) Kohl's - Balance $750.00 (APR 21.90%) Current Total credit card debt: $15,600.00 Student Loan Nelnet $13,500 (2.480%) Autos Paid for Mortgage Lender - Countrywide now B of A BAC Fannie loan No PMI No Homeowner dues Past Due: 3 months Received a letter of intent to accelerate Payment: $1,398.66 Balance on loan - $149,000.00 2009 Proposed Property Taxes Market/Assessed Value- $132,504 Property taxes this year will be from $1480 to $1540. Our insurance is high (Florida) but I don't have the exact figures right now. We bought the home for $197,000 in 2005. Put $35,000 down. Current eappraisal $155,000 Current Cyberhomes $121,000 There is a house similar to ours for sale right now. It is listed at $150K and has been on the market over 100 days. I think they will be lucky to get $135K. In August of 2009 I contacted B of A. After asking me some brief preliminary questions I was told that I was eligible for a MHA mod. I had 72 hours to fax them my tax return, unemployment benefits letter, bank statements, and hardship letter. I sent this info in time. They never sent me any paperwork to fill out, nor have I heard a response yet. I have since however read online that we won't qualify because my husband's unemployment won't/didn't last 9 months. Also, I read in the newspaper that it can take banks up to 6 months to process a mod so maybe they are still working on it?? Doubtful, as I received a letter last month stating that I may be eligible for a MHA mod. Here is the current situation: My FIL asked us to come live with them and take care of MIL who had terminal cancer. He stated that he would pay our bills while we did this. Both my husband and I were unemployed so we agreed. We also were able to have that time with MIL before she passed which was priceless. We have been here several months. FIL ran into some financial problems a couple of months ago and was unable to pay many of the bills (credit card payments and mortgage payments). FIL is now in the position to help us get caught up. However, we still have some problems. We won't be able to leave FIL and return home until next month. We are praying that there will be work there when we get back. Once we get back and are gainfully employed I plan to contact BofA and try to get the mod done. We HAD a years worth of mortgage payments in savings. Actually we had a lot more than that in savings so I could work part-time from home. That money has been exhausted and was used to keep us afloat as long as it did. If we can get our loan modified we can make the credit card payments. But the house comes first. Questions 1) FIL has agreed to pay off Chase - Balance $4,700.00 and GE Money Bank Sam's Discover - Balance $8,200.00 if I can get them to settle for about 30%. Would the creditors even entertain this idea? How would this effect my loan mod? 2) Would it be better if I tried to get the credit card companies to lower my interest and monthly payments? Will they even do this? 3) Should I catch up with my past due credit cards minimum payments or wait for them to settle? or will they send them to collections? (Once I catch up, I probably will not be able to make the minimum monthly payments if I make the mortgage payments so I will behind again). 4) How would bankruptcy effect my loan mod? I don't want to go bankrupt but am not sure what will happen if we pay house and not credit cards. 5) I plan to catch up on August and September mortgage payments. I might even be able to pay Novembers but I will not have Decembers. 6) FIL wants us to short sale our home and move here. Long story ... he has cancer as well, wants my husband close to him, etc... But I don't want to short sale/foreclose unless I can't get my loan modified. Would my bank even entertain a short sale? 7) When my husband is working he makes about $3200 gross monthly. I was self-employed but currently there is no work in my field so I will be trying to get a job as a cashier or something similar at night while he is at home. I'd like for our mortgage payment to be no more than $950. I think we can afford that. How much combined income do we need to make the payments about that? How are debts counted? I don't want to be turned down because we don't make enough money or that we owe too much debt. My SIL was recently turned down for a mod stating that she didn't earn enough money. She works two jobs (since her husband passed) and is always one monthly payment behind. GMAC told her that she was about $500 short so she rented out a room in her house for $550 and reapplied. She hasn't heard anything yet. Please let me know if you need any additional info.

11-03-2009, 09:29 PM	#2 (permalink)
flagirl4444 Senior Member Join Date: Sep 2009 Posts: 153 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Credit Cards and BofA (BAC) Loan Mod. For a payment of $950, you would need about $3k/month income. I would try and settle with the past due credit cards. (just be aware that they will send you a 1099 for the amount they forgive, which may be considered taxable income depending on your situation). You may have more luck settling once they are more than 3 months past due and charged off, especially if/when they are sold to a collector. Either way, I don't think it will have too much bearing on your loan mod but it's hard to know. It looks like you are slightly underwater, so that would probably work in your favor. (too much underwater can increase the likelihood of redefault and makes a loan mod less attractive to the lender, and too much equity makes the foreclosure more attractive as well). If you sent the application back in August, they probably lost it. I doubt they are still processing it. Definitely call and try again, but you will need to have sufficient income to support a payment, whether it's the $950 you want or even less.

11-03-2009, 09:37 PM	#3 (permalink)
flagirl4444 Senior Member Join Date: Sep 2009 Posts: 153 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Credit Cards and BofA (BAC) Loan Mod. I just did a quick calculation, and if your balance is $149k and they do the maximum lowest of 2% at 40 years, your principal and interest payment could be as low as $450 per month, plus your taxes and insurance $250ish? for a total payment of $700/month without having to forbear any principal. There are a lot of unknowns, but if that scenario is possible then you would need to have a gross income of just $2300 to support that payment.

11-03-2009, 11:37 PM	#4 (permalink)
davephx Senior Member Join Date: Jul 2009 Posts: 1,143 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Credit Cards and BofA (BAC) Loan Mod. For consumer credit cards its 180 days till required to charge off.

Thread Tools
Show Printable Version Email this Page
Display Modes
Linear Mode Switch to Hybrid Mode Switch to Threaded Mode