Gmac/homecomings

[rx4suzy]

We received a letter from GMAC offering to reduce our principal from 297,000 to 243,000..we have never been late on a payment..in fact always pay early..I asked why are we being offered this to the loan officer Terry Bradley (our current lender is Homecomings which is GMAC) he replied that it is to keep people from walking away from homes and to keep their customers. It seems so fishy to me but I can't figure out what the scam would be..does anyone out there have any idea if they are for real or is this a rip off somehow? Thanks, susie las vegas, nv
ps I need a quick reply cause they want the stuff this week if we're going to do it

[Moe Bedard]

You might want to ask if this is the H4H program with FHA because GMAC is able to refinance into this program...........

also if you want a verification of the solicitation you can call directly into GMAC and ask.........
1-215-682-1000

[rx4suzy]

Thanks ***, I am going to email Gmac's guy and ask...our tax guy looked at it for 2 days and said it's a 7% fha assumable fixed and he reccommended that we do it..omg, I'm scared.

[Moe Bedard]

Don't be scared.............it sounds like it will make things even better for you............

[rx4suzy]

Thx You've eased my mind a bit...I guess there will be a lot of new things happening in the mortgage market..it's a great thing if they follow through..susie

[RudyJay]

I wish Homecomings offered me that option...good luck rx4

[justkathy5]

Wells Fargo is also doing this with a select list of the mortgages they are holding themselves (WF made the loan & services it).

The general word as to why they are doing this is that there is something wrong with the original mortgage that makes it "unsellable" to another lender. They are trying to repackage the loan so they will be able to sell it to another servicer (i.e. The Government). I know for sure that is what's happening with WF (because I am one of those select people), not sure about your lender. Maybe.

The "something wrong" with our loan was that the TIL docs in WF's mortgage file for us doesn't match what we signed at title and the appraisal was highly inflated (lucky/smart for us/WF we didn't borrow up to that inflated $). I am working with WF now, not on a principal reduction (we aren't upside-down and we did borrow the entire principal, we intend to stay here, etc), but on an interest rate accommodation. But I am not agreeing to anything until they do exactly what I want - they want to sell my loan, fine, but there are irregularities in my file and I am going to use that as negotiating power. They don't like it, but that's too bad for them. Maybe they will learn to run an honest shop.

If GMAC are willing to do a principal reduction I would say there is no reason not to ask them to come down even more honestly. You have time to do a quick run of (deflated) comps so you can at least get it right in your own head if this is a good deal or no.

kathy/il

[rx4suzy]

Kathy, I asked the GMAC loan officer (Terry Bradley) if it was the H4H FHA program and he said no, it doesn't have a name.they are just trying to get upside down loans back to appraisal value..does that sound fishy? We have asked everyone and even called Homecomings financial this morning to make sure this Terry Bradley really works for GMAC. They verified it but the strange thing was they thought it was the H4H FHA program we are being offered and then Terry said no, it doesn't have a name..I'm going to lose my mind before this is over.

[RudyJay]

No you are not losing your mind... It sounds like an affordable option...

[justkathy5]

The offer from GMAC is probably legit, I wouldn't worry about that. You will eventually get legal paperwork that will spell out who the lender & servicer is.

The GMAC mortgage unit is teetering on bankruptcy. It's possible/probable they are trying to repackage your loan to make it sellable (to anyone, the Govt, another lender, whatever). They may want some of the $700 billion bailout $$ and they might have to do things like this to get some. It's anyone's guess, the Govt isn't sharing about what's required for banks to get a piece of that pie.

The deal doesn't sound bad, but these are the issues I would consider if it were me.

-The principal reduction is nice, but is it bringing the principal balance into line with comps/selling prices? If not, will they go lower?
-The interest rate is just ok, but if I were in an ARM & wanted a fixed, OK might be OK. It is a little above current market rate & asking for a little lower couldn't hurt.
-Is this a refinance? If so, does it restart a new 30 (or even 40) year repayment term? Because if it does, that means you will pay more interest over time, thus more total for the house over time. That might be okay for you, but the question needs to be considered.
-If it is an FHA loan private mortgage insurance (PMI) might be required, this can be expensive & the cost of that should be known upfront. That insurance costs a lot, can't be gotten rid of before you hve 20% equity (and who knows when anyone might have 20% equity in this economy), and is hard to get rid of even if you can show you have 20% equity.
-You haven't posted what the new payment would be, and if it includes escrows for taxes & insurance, etc. Make sure you know what is included in the payment so you don't have a surprise $XX,XXX.XX property tax bill due in the spring. I think FHA requires escrows at least for taxes. Can you afford the payment?
-Are there origination, points, fees, lalalalala and so on?

From what you have posted it seems they are not simply offering to reduce your principal, this is either a refi or a loan modification. Either of those might be good in your situation but you need to know exactly what is going to happen before you sign.

I hope this is a positive offer for you & hope it works out. The Average Joe/Jane could use a break & a little help like this.

kathy/il

[rx4suzy]

Kathy, Yes, we can afford the payment..I found a place on Google that explained that Homecomings and GMAC and RESCAP are in trouble and they have to fix their overpriced arm's so they can sell them as you said which made me feel much better about the whole thing What made us suspicious is that we are always early on our payment so we thought it was a scam..the post I found was Google then put in GMAC and short refi's. Now my husband just said, "What if when Homecomings went broke, we would owe nothing and now we are in a new loan." I'm sure that wouldn't happen..but never any peace of mind around our house I guess. Does anyone know what happens if a lender goes belly-up..does someone get assigned the loans? This website is great..thanks for the help..susie

[Moe Bedard]

Susie,

Homecomings is just the servicer on your loan...........if they were to go bankrupt the investor on the loan would transfer it to another servicer.

[rx4suzy]

Ahhhhhh..thx

[dnrsmith]

Suzy,
We live in Las Vegas and got the same offer. Did you accept it? We are still considering it?

[rx4suzy]

Omg..I'm so happy to hear from someone else who got the offer...What happened was, we went through with it.the appraisal came in low.so they lowered it to 220,000 from 297,000..I thought they were weird because I heard nothing over Thanksgiving, so we made our Dec 1st payment..the very next morning I got an email stating it was at the underwriter, she needed a few things, we sent them and it's supposed to close within 10 days.I told Terry Bradley we made the payment an he was sort of offended like why didn't we believe him..I told him this is new to all of us so we have every right to be cautious. We were never ever late on pmnts? Anyway, after showing it to a real estate lawyer in vegas and our tax guy who is a very smart man, they both said do it!! Ask Terry for a copy of the mortgage releif act that you give your tax person so yu do not have to pay taxes. (ZERO). It's the mortgage forgiveness act of dec 07 passed by bush..also the final papers from the underwriter said we will take a smal hit on our credit as a short pay but it's worth 80,000 to us. Now we are waiting for ours to close, I will let you know if it does and if so if there was a catch..susie
PS Please let me know what you do and what happens. susie
We are in 89183..where are you guys?