Upside Down Does the Bank/Investor want our home?

[Fiveo]

I am new to the forum and have lot of questions. We have a 2 yr old home in Phnx. Paid 310, mortgaged 250 current value is just under 200. We have applied for a mod with WF thru NACA. Not holding my breath since My income is just over the 31% gov regs. We are loosing my wife's income next month and I am taking a reduction in hours. We are current now but will more than likley be in default by early next year

Do the banks want our homes? Seems like simple math to me. If they gave us a mod down from our 6.6% to a lower intrest rate we could be able to stay in our home and they would still make money, just not as much. Or we could defualt, stay in the home for 6 to 9 months free. Then they could forclose and maybe when its all over a done sell or auction it off for 175.

Why are they not willing to deal to make money? Is there something I am not seeing?

[Evan Bedard]

Hi fiveo,

Do the banks want our homes? Seems like simple math to me. If they gave us a mod down from our 6.6% to a lower intrest rate we could be able to stay in our home and they would still make money, just not as much. Or we could defualt, stay in the home for 6 to 9 months free. Then they could forclose and maybe when its all over a done sell or auction it off for 175.

Why are they not willing to deal to make money? Is there something I am not seeing?

I am sure the banks do realize that they are losing a lot of money through foreclosures. All of us here are wondering the same thing....

[davephx]

Remember the SERVICER is not losing anything on the sale and in fact is getting foreclosure fees. Unless your servicer is also the investor but this is rare.

Servicers don't decide on any subjective basis. Either the numbers work or they don't but that is what the Net Present Value Test is suppose to show. Taking into account zillions of factors which is best for the investor - mod or foreclose.

It seems your much better off if you are somewhat delinquent AND especially after wifes income is gone assuming that doesn't make it too low to qualify.

[Fiveo]

I made a mistake I meant for the the title to read "Do the Banks/Investors want our HOMES" meaning all of us. Why else would the make if so difficult? Our mod request was sent to Freddie Mac by WF, but I guess they are not playing ball much either. Do they bascially decide wether they will make more money by modifing your loan, or if it is better for them to forclose?

I

[davephx]

They are suppose to decide based on the NPV test which is secret!

[Fiveo]

So it all comes down to some formula? Is it a secret between the banks, investors and feds? Where did I put that pitch fork?

[Fiveo]

We dont qual for HAMP. Will Freddie still run a NPV do determine if they will make more by forclosing or by giving us mod?

[Evan Bedard]

We dont qual for HAMP. Will Freddie still run a NPV do determine if they will make more by forclosing or by giving us mod?

They did not do a NVP test before the HAMP and MHA program came out so I think they would not use it in a traditional modification. These programs are not really helping anyone either by the way..