3 Loans w/ AHMSI primary with a $500k neg equity

[dcurtis7418]

Here goes... I'm a new member and can't express how valuable these post have been for me. Thank you all so much for taking your time to post. I have 3 loans with AHMSI.. Primary and 2 rentals. I did all three loans at the same time. With an adjustable gross income of 135,000 I qualified for 144,000 of annual mortgage payments (yeah right). Our primary home was purchased for 1,000,000 in 2005... Our county at one point was #1 in the nation for depreciating home values. According to Zillow our home is worth about $500K..as well as our assessors office who have been so kind to have lowered our taxes in half. I have been using credit to pay all these mortages.. We never intended to keep our rentals over 2 years and now they are adjusting. We have been told by several people that we should have never qualified for all 3 loans especially with the same lender.. we did everything by the book.. it looks like the lender used our gross income instead of our net.. We had an audit done on all three properties and each one has several violations...The lender is responsible I believe after finding out how we qualified as well as these violations. However this is also a hardship for us; as credit is how we are keeping afloat. Do I travel down the hardship road or violation road??? I dont think in 15 years we can overcome a 500k upside down equity position.. Does anyone have any suggestions on my likelyhood of getting a principal reduction. We have completly depleted our savings and cant keep putting on credit any longer as we are maxed out.. The last thing I want to do is walk away. However scared that may be are only option.. HELP!!!

[Moe Bedard]

Hi dcurtis7418,

Welcome to the forum and thank you for joining...........

Modifications given would depend on the investor on the loan and we just are not seeing the investors on the first liens doing principle reductions............if you have second liens on them you may want to approach that lien and see if you can get a principle reduction from the second as we have seen a few of those.........

[dcurtis7418]

Thanks ***,

I only have a first on all three... Do you or anyone else know the logic behind these mortgage companies not wanting to lower the principal to the appraised value. This just doesn't make sense for them to go into foreclosure to not get any payments for possibly a year; spend thousands on a realtor to sell a house they already have a buyer for ; title fees, appraisal, possibly an eviction service or give the homeowner a goodbye check upon departure...SUCH A WASTE OF MONEY!!!!!!!! how does this make sense when so many of us would be able to afford our mortgages at the current apprasied value and the mortgage company could save all the extra expenses.... please..... please someone shed some light...

[Moe Bedard]

When an investor shows a foreclosure on their books even for a year it does not show as a loss as one might think........it shows as the full loan value on their books........the investor doesn't take an immediate loss for a foreclosure.

Ambling said it best here in another thread regarding the principle reductions............

A principal reduction affects their balance sheet immediately... which hurts the liquidity and leverage positions of the bank. It's only an accounting trick on paper but it affects the bank's business in a real way when they report their quarterly earning (or losses) to the SEC.

[dcurtis7418]

Thanks again ***... I understand... don't like it... but understand... basically "cooking the books"....