Interest rate question.

[Daisyflower]

I have notice that I see people getting all different kinds of rate. Some got 6 and some got 5 or 4, and some got a step rate plan and others just got a fix.

However, I got the step rate plan starting at 4.0 up to 5.5. I wanted to know How can I qualify for a 4.0 fix for the full 30 years? Is there anyway to ask after an offer has bee put in and approved? Or should I just shut it up and keep my rate. I want a 4 percent for good as soon as it hits 5 percent in 3 years I dont know if I can afford it then.

[Moe Bedard]

It is because they all have different investors on their loans.............the modifications given are up to the investors that hold these loans in their portfolio and what they are or are not willing to do.
You can ask if there are other options available from the investor on your loan or is that the best that they are going to do.

[bigald1]

I would strongly suggest that anyone whose rate is changing read their "Adjustable Rate Rider" in their loan documents. I have a loan from Option One/AHMSI and they told me that my rate and payment would stay the same at 10.1%. My loan documents state that the rate is the 6 month LIBOR plus 6%. On Dec 1, that rate was 2.59%. On Jan 1, it was 1.75% With the December 1 rate my loan should reset at 8.59%. I had to argue with their "customer service" person in India and they first argues that my minimum rate was 10.1% (wrong), that the loan can only go up or down 1% (not for the initial reset) and that I needed to wait 2 years (loan eas made in Dec. '06). In other words, they are going out of their way to rip people off and banking on the fact that you 1) did not save your loan documents or 2) don't understand the language of the loan documents to steal from people. I fully intend to lodge a complaint against them with the Attorney General of California and would appreciate other ideas for keeping the maximum pressure on them. They couldn't rip me off because I am a CPA and can decipher loan documents but I am sure that there are literally thousand of people who are getting ripped off in this shameful manner.

[socaljager]

Keep your 4% rate for the first year it was offered, but call your negotiator and ask them to note your account now that the 5% will likely be unaffordable and you will re-apply for another modification once the 5% rate takes effect. This is the best they can do for you if you have already accepted your mod. Don't try to apply again before one year's time, however. They will deny the request until it's been a year from the first mod.

Honestly, though, 5.5% fixed 30 yr after the step is a pretty good deal. I've seen plenty of step mods that fix at 6%, 7% and a few even 8% after the 4 years. It's all based on what they feel you are able to pay.

[elpjohnson]

socal is correct....you can re-apply for a mod after a year's time but I'm not sure the investor will give you a better mod than what you've got right now.....it is a very good modification. With that said, it doesn't hurt to ask and see what your options are.

Good luck!