Countrywide 1st HSBC Heloc

[kshel02]

Hi everybody,

I have an ARM with Countrywide. I just got my modification doc's from them only, after 4 months of begging and going on local TV with a Rep from Acorn to address the foreclosure crisis. I have a HELOC with HSBC. They don't want to do anything to help. I will use the tools that I have gathered from this site to take care of them. My question is, I am sitting here looking at my loan doc's from both loans. I paid what I now know to be exorbitant fees on both. The broker on the first got 3,720$ on a 125,000 loan. In looking at the HELOC doc's there is no TILA at all and my husband's income is stated at almost $6000. a month (I wish). I never told them that. Also, when I applied for the loan, I didn't want a HELOC, didn't even know what one was. What are my options? Thanks, Kerry

Hey there, there never is a TIL on a HELOC, they have a different disclosure methodolgy as they are a variable rate loan....take a look at that really long, multi page hummer that sets out the payment, how they compute it, etc....the Note and T/D Combo set of papers. Somewhere around page 3, 4 or 5...you will see the APR will never be greater than ___% over the life of the loan...that is the disclosure that you are looking for. That is how they do HELOC's.

They do not TIL the HELOC's or HELOAN's...just the true closed end seconds. The overstated income does not surprise me, par for the course, saw it every day on the underwriting side of this business and got in trouble for not believing it... wonder why....what recourse do you have, well that is my question, what recourse is there for the borrower that did not participate in the self-help that the Broker doled out with the overstated or inflated stated income loans...it is predatory and misrepresentation...but, there is nothing that I have seen to date that has allowed that to be a cause of action against the parties involved. The actual Compliance Violations do have cause of action.

The Broker got 3% for his trouble, my max allowable in my shops was 2.0% that is normal, usual and customary in the Mortgage Banking world...3.0% for Brokers is what they assume to be normal, I have to admit I have seen a lot worse....would it be deemed predatory, not really, it is when they exceed the 3% or more in my opinion. The two toughest states for capping mortgage fees are New Mexico and Missouri, they have a limit of 5% for fees and charges....FHA caps at 6.0% and FNMA/FHLMC at 5%. These are total allowable financing fees and charges...not inclusive of title and other NRCC's.

The HELOC is a toughie to get modified particularly with HSBC...they are really not user friendly similar and on a par with Litton. All you can do is try for a modification to a closed end second with a fixed rate, you can request, they hopefully will accommodate, they are more compliant with the modification on the Firsts, or so they say....time will tell, for their sake I hope that it is not just lip service.... So give it a try, ask for it to be closed to further transactions and make it a fixed rate closed end second....of course reduce that nasty rate as well.

Please get those modification documents back to Country Fried...right away, fax them right after you sign them and then Fed X the originals to them. Make copies and I have suggested that you get the copies notarized prior to FedX'ing the originals back to them for safety sake.....

[kshel02]

I guess now is a fine time to get interested in the doc's we signed in 2006. The margin on the HELOC is 5.3750, APR 13.6250. The max APR is 18%, sounds reasonable as hell! What was I thinking???

Kerry

Actually the 18% is what is in all of them in today's world, used to be less, but the closing fees on the HELOC's and HELOAN's were about 75.00 or some such nonsensical amount...most I ever saw was 200.00, they are a combo closing and even the Broker does not make diddly off them, problem with the HOEPA stuff if they do.

That margin is not that bad, not that good either, prefer about 3 over prime....sorry, but try 6.50 and up....I have seen it, disgusting, prime plus with a max cap...the variable rates have to be careful of the high costs issues, they are different from the first lien regs, more lenient, but still have to worry, yours is standard from those figures posted, nothing out of the norm.

Yep, sooner or later everyone does look at those documents and sez OMG, me, I made my borrowers read them before hand, in front of me with a note pad to write the questions down....then we went to town with the answers. I kept blank closing packages for just that purpose for the first time home buyer, they now know more than the Brokers....I created very knowledgeable borrowers, they hopefully never got skinned down the road, they did know more than the Brokers that I have worked with.

[kshel02]

Ok, so I have the Countrywide modification doc's out and I am going over them with a fine tooth comb. Signing things that I don't comprehend is what started this whole debacle. Well, they are adding $6,427 in interest into the balance of the loan. But, it says that the interest rate and monthly payment will adjust in accordance with the note, Adjustable rate rider and any other loan document that is affixed to the note and Rider and provides for, implements or relates to any change or adjustment in the interest rate and monthly payment amount under the note. So, I still have this crappy adjustable rate??????????????? I

Is there a section in the documents that allows for a rate freeze or abatement of the rate for a period of time during an alloted period of time?

They have added the back interest to the principle that is good, however have they given you any relief on the interest rate...i.e. monthly payments, that should be outlined in the Modification Agreement or this is only forbearance, not true Modification.

They are freezing rates when the financial situation (hardship) supports the request...it is still the same crappy ARM after 5 years, but there is a relaxation of the rate for that period of time to allow for things to get back on an even keel.....

Check further into the document around page 3 or 4 to see if they have skewed a new payment stream...

Poppy said, "They have added the back interest to the principle that is good,..."

The problem I have with many of these threads is we do not have a clear picture of the situation, nor a crystal ball to understand just where this market is and where it will be down the road. Now I recognize a basis for Poppy's statement, but what benefit really results if the property is $200K underwater and the combined loan payments after this restructuring greatly exceeds the fair rental value of the property? Yes your credit score might survive being dinged from the effects of a foreclosure. But if all you are doing is robbing Peter to pay Paul to make restructured monthly loan payments, as the total principal on the loans goes up, and the value of the collateral goes down, does that make sense?

I encourage all participants in this forum to step back and do a business analysis of their personal situation. Key information needed includes both the amount of equity you have in the property and a determination of both the fair rent for the home and the effective amount of your house payment (including interest, taxes, insurance, HOA dues, and deducting associated income tax deduction benefits).

This sort of risk vs. rewards analysis is critical in my opinion. As we are seeing in the news, many homeowners are deciding to abandon the idea of lender workouts in favor of letting their home go through the foreclosure process. As more people make that decision, I believe it will impact the market in two ways. The first is that it will accelerate property value decline. Second it will speed up the time it will take to "reach the bottom." That bottom I believe will be reached when we reach a level of true affordability for that ready, willing, and able buyer.

Daniel

[kshel02]

It looks like there are some documents that are not here. Page 2 says that there is a step rate modification addendum and an automatic payment application, neither are included. There's nobody's name that I can reference it back to. Is this some kind of sick joke?

You are missing addenda to the Modification Contract then from Country Wide, first thing Monday AM you will need to call this number....did they give you a negotiator name?

Anyway, this number and do the 0000 button pushing, until they ask the second time if you want to speak with a human being, second time mind you...the first is a ruse.

You need that step segment of the documents to determine just how much relief they have given you...these packages can be faxed, so that is always my recommendation.

[kshel02]

I've been calling Countrywide all day. Their computers are down. Is that because the Fed's are there??????

No, you only wish...we all crash from time to time, it is a function of such a huge system.. IT is probably tearing their hair out, I have been through 3 day crashes of the systems in shops, it sucks.....

So, keep trying, they are more frustrated than you I would venture to guess, cause they can not do anything and they are at the mercy of the MACHINE. Believe me it is awful when that happens to you...

[kshel02]

Glad I didn't send these "modification docs back without checking with you guys. I just got off the phone with Countrywide. The document that is mysteriously missing from my packet is the one with the "new" loan terms. The guy I talked to said that they didn't change anything except roll the past due back into the loan. The banking commisioners office of Delaware previously called on my behalf and they told him that they were giving me a fixed rate for 5 years. Now, I get these shady doc's. Where do these people learn this crap? I couldn't be this devious if I tried. Now what do I do. I am working on my QWR right now. I am pissed!!

Call them back and inform them that you are privy to the conversation with the State Banking Commissioner and call the State Banking Commissioners office with the pleasant news on this issue.

Bet they will be interested...also call HUD and OTC, they are the regulatory authorities for Country Wide.....

I suspect you need to get an e-mail to your negotiator and let them know that this was the agreement as they proposed it to the State Banking Commissioner of your state and you really do not want him disappointed, do they?

[kshel02]

Hi everyone,

I haven't been here in a while. I got a follow up call,to an e-mail that I sent to Angelo Mozilo, from Maria Marquez (800) 669-2443. She has stayed on top of my modification and returned all of my calls. When I e-mailed Angelo, I also copied David Bigelow, if anybody can use this info, go for it!!!!