What to do... Again

[mamamurph]

So I have posted here before asking for advice and here i am again.

I owe 435000 on a house that is worth 360,000. I have a maxed out Home Equity line of credit with the same bank. I am paying the minimun payment on an option payment plan on a negative AM loan. The fully amoritized payment is double what i am paying now. My interest rate is at 7.25% but must have a cap somewhere because my payment has not increased drastically like some of you. I am adding on 1300.00 per month onto the backend of my loan because I can only afford the minimum payment.

On top of all that... January 2009 my loan will reset at the new balance taking away the minimum payment option. The loan was written for a principal balance of 407,000. When the time comes I definitly wont be able to afford this.

So do I stick it out and wait until the dreadful reset date or do I skip out on it now?? I am almost positive that situation will end in foreclosure. I talked to my lender yesterday (indymac) and the guy in the loss mit dept said that they really couldn't help me because i am current on payments. He also said that if they did offer help it would be in the form of a rate freeze for a period of time or possibly rate decrease. Both of these options won't help unless they are very drastic.

So I need help obviously....what do you think????

Can you please tell us what kind of loan this is, if it is an Option Arm, the chances that you will hit the CAP before the 5 year recast in the Note as you are making minimum payments is high, like it will happen. What is the CAP? What month and year did you take the loan out in? What is the Balance today on the principle?

Meanwhile, put the modification agreement into IndyMac Bank, they are modifying the Option ARMS before you are delinquent...I need to ascertain when that recast hits because the cap gets met. The cap is in the ARM RIDER second page middle of page, generally, but always on the second or third page of the ARM RIDER.

Yes do start the mod process now, they will be cutting deeper into these things with modification by the end of the year.....lots of losses coming up....so you will be able to re-apply I would think for another modification down the road.