question regarding Chase and unemployment

[jennyc]

Hello everyone,

I am new here and so glad I found this forum!! My mortgage is with Chase and I have a few questions~

I am now on a trial mod, just made my 3rd payment, but am wondering if I am going to be denied a permanent mod because I am now unemployeed?

I sent my mod. request paperwork in last November and did not get the trial mod until July, I was laid off in June. I had to send in new financials with the trial mod agreement and was hoping they would lower my payment even more now that I am unemployed.
Chase lowered our payment by $300 and counting my unemployment income with my husband's, that puts our payment at 46% of our gross income. Without counting my unemployment, there is no way we will qualify for mod of our mortage, it's too large ($388,000). my husband makes $40,000, I was the primary income for our family though I had received a pay cut prior to being laid off.

My question is this~should I continue to make my payments or should I just start saving? I would like to keep my house but will also need to build my savings back up if I have to move. I estimate I have 6-9 months of unemployment income. My fear is Chase will drag their feet giving us a final answer and then finally say no after my unemployment has been exhausted.

I realize this is a personal decision, but any feedback is greatly appreciated!

[jennyc]

Ok, I now have another question, sorry! As you will read, I am stressed!

I just realized that if Chase does deny my modification they can begin the foreclosure process immediately. Has this happened to anyone? Does anyone have a timeline for how long it is taking?

I just checked my Chase account and they show my last payment posted 9/01/09 (I have made a payment every month) and $7000 behind. This is sooo frustrating because I was current on my payments before this whole trial mod. began!!!!! What are they doing with my money?

Also how do I know if they have started the foreclosure process? The folks at loss mitigiation (sp?) tell me my house has never been in foreclosure but I don't trust them. I am extra worried because we did file bankruptcy last April and did not reaffirm this mortgage, though Chase says this doesn't matter (?)

Please, any feedback is appreciated, thank you.

[freediykits]

Like you said this is a personal decision, but if I were you and I was pretty sure that my loan modification was going to be denied, I would probably stop making payments. Worst case scenario is you get kicked out in a couple months with a few thousand saved up, and best case is you get kicked out in a year or more and have Thousands saved up....I have known people that have gone 2 or more years without making a mortgage payment. By the time they had to leave they have saved a small kings ransom (>$25,000). Like I said i really don't know your exact situation but if you feel that your loan modification is not going to be approved I would start devising a plan B.

Obviously i recommend getting a second opinion on this matter. I don't know how your credit score is right now, but a foreclosure will basically destroy your credit score for a few years...

Good luck to you with whatever decision you decide to make.

[MyHAMP]

Originally Posted by jennyc

I had to send in new financials with the trial mod agreement and was hoping they would lower my payment even more now that I am unemployed.

I'm not so sure you are automatically denied. When did you send in these financials? That's important to know because I need to figure out if there was a change in income DURING your trial period or prior to it.

Also, if you could provide us with more information about your property (current value). What is your current income now? If unemployed, can you provide proof that you will get compensation for the next 9 months? Are both of you on the loan?

Even if they have to use a lower income when they determine the final NPV, you could still pass - depending on your circumstances, so please provide as much info as possible.

[jennyc]

Thanks for the replies, I really appreciate the help!!!
Here is a little more info~

-Our house is worth $380,000-390,000
-We owe $388,000 on the first, $45,000 on the second (second is also with Chase)
-I was laid off May 28th this year
-Applied for Modification in Nov of 08
-Received trial mod paperwork in July, have made all payments
-sent in current financials, husband's paystubs and Unemployment statement with trial mod paperwork
-payment was $2569, reduced to $2283 on trial mod

Other things to consider-

~we were never behind on payments
~My income was $55000 at time of modification application before lay off ( I used to make $77,000 when we bought this house)
~My husband's income was at time of modification application and still is $40,000
(he also lost his job after we bought this house but found employment at reduced income)
~We filed bankruptcy in January and was discharged in April of this year
(we had a rental that was losing money, resulting in us charging up our credit cards trying to stay afloat)
~we surrender the rental in bankruptcy (rental was with Chase), planned to keep this house but....
~Did not reaffirm this mortgage (Chase says this doesn't matter as far as modifications go?)
~ My unemployment has been extended for another 20 weeks and most likely will be extended another 26 weeks after that as I have been approved for schooling (worker retraining) I can only document 20 weeks right now

As you can see we have had a rough, rough year. As far as my credit goes, it has already taken a huge hit (550 score now after bankruptcy). We are trying to do the right thing but it is so hard to make a clear decision when you don't have all the facts and are emotionally tied to this house. I really appreciate all the help and feedback. Thanks again.

[litehouse01]

This trial mod is it HAMP (Making homes affordable) or something in house with Chase because it doesn't seem that your payment was reduced to 31% of your income unless I am missing something.......I am thinking this is in house because the maiking homes affordable plan didn't begin until APril

[jennyc]

I was told that last week when I asked the Chase Loss Mit. that I was on a HAMP trial (?) But who knows what I will be told next week......

[jennyc]

Originally Posted by MyHAMP

I'm not so sure you are automatically denied. When did you send in these financials? That's important to know because I need to figure out if there was a change in income DURING your trial period or prior to it.

Also, if you could provide us with more information about your property (current value). What is your current income now? If unemployed, can you provide proof that you will get compensation for the next 9 months? Are both of you on the loan?

Even if they have to use a lower income when they determine the final NPV, you could still pass - depending on your circumstances, so please provide as much info as possible.

Our current income now including my unemployment is $5600 monthly. My husband's income is $3300 and my unemployment is $2300.

[MyHAMP]

Originally Posted by jennyc

Our current income now including my unemployment is $5600 monthly. My husband's income is $3300 and my unemployment is $2300.

OK, let's run some numbers:

Assuming your unemployment is considered:

$5,600 x 31% = $1,736 for PITI under HAMP.

If unemployment is not considered:

$3,300 x 31% = $1,023 for PITI under HAMP.

I forgoot to ask about your taxes and insurance on the property.

[jennyc]

Originally Posted by MyHAMP

OK, let's run some numbers:

Assuming your unemployment is considered:

$5,600 x 31% = $1,736 for PITI under HAMP.

If unemployment is not considered:

$3,300 x 31% = $1,023 for PITI under HAMP.

I forgoot to ask about your taxes and insurance on the property.

taxes are $4500 a year and insurance is $1000 yearly.

[jennyc]

I think without my unemployment factored in, there is no way Chase can make my modification work. That's just my educated guess......

I am trying to find employment, but as we all know, that is not easy.......

[MyHAMP]

Originally Posted by jennyc

taxes are $4500 a year and insurance is $1000 yearly.

OK, that would leave $1,277 for P&I if they include unemployment.
That doesn't look bad at all - no need to forbear principal for the lender.

At 2% APR (5 years), you could pay off your loan in less than 36 years. To me, that looks very good...


Now, let's say they DON'T use the unemployment:

Leaves $565 for P&I.
That would be an interest-bearing loan of only $185K at 2% APR in the initial 5 years, loan term 40 years. That would require a forbearance of $203K and that in combination with NOT being significantly underwater on the first mortgage will probably lead to a negative NPV - which is - in combination with an interest bearing principal balance of less than 100% of what your proprty is worth - an automatic disqualification under the HAMP guidelines.

So if you can/could provide proof that you will receive unemployment for 9 months, you should be fine. However, you should ask them why your trial payment is that high. It should be close (usually within 10%) to the $1,736.

[MyHAMP]

Originally Posted by jennyc

I think without my unemployment factored in, there is no way Chase can make my modification work. That's just my educated guess......

I am trying to find employment, but as we all know, that is not easy.......

That's robably right - SO GO MAKE THEM FACTOR IT IN!

[jennyc]

Originally Posted by MyHAMP

That's robably right - SO GO MAKE THEM FACTOR IT IN!

Thank you HAMP! Now, considering I am dealing with Chase, any suggestions how?