Another Story

[Feelingtrapped]

Hello All,

I found this site last night and read for hours and hours. I appreciate that fact a site like this has been created to help people like me discuss this situation with others and learn about the process I will most likely be facing.

My story sounds similar to many I have read. I purchased my home in the IE of Southern California in 2000 and refinanced the last time in 2005 (at the peak) and I took out a small second as well.

Currently owe 585.000 1st TD First Federal Bank of California
40,000 2nd. B of A

I was not very familiar with these option loans; however, the loan originator said it was the "wave of the future" and everybody was doing them. I was looking for some breathing room from other debt and decided to take one and pay down my debt load. I was "assured" by the lender not to worry about the negative Am as my house was appreciating fast and they would just refinance me before the big reset in 2011. This loan included a three year pre-pay penalty to keep me in it. My appraisal at the time was $653,000

Now the market has crashed and taken all the equity I potentially had with it.
Current market value on my property is probably 375,000 to 400,000. I am seriously upside down and getting further and further in debt every month. Foreclosures, home auctions and abandoned properties are all around me.

I am current on all payments, have never missed or been late; however, my payment is scheduled to go from $2000 per month to $5000 per month incrementally over the next 3 years. I know I can not afford this.

I work full time, have taken an additional part time job teaching in the evenings and started a small business last year, all with the hopes I could absorb the huge house payment. I am exhausted, stressed, sleepless etc. like most of you.

I am feeling trapped and do not know what option I should be looking for. Short-sale, modification, walk-away, do nothing and hope for more government intervention? We do not want to loose our home and would very much like to stick it out and save our property; however, with the debt load on the property I am not sure staying makes sense. I am not sure even a modification will make this place affordable either. Even my CPA said why throw good money after bad debt.

The worst part is I have not shared our situation with my wife. I don't know how to tell her the house we have shared and raised our 3 children in for the last 8 years is in jeopardy. This house is her pride and joy and this is going to crush her.

I plan on contacting a local attorney from this area for starters. Can anyone else point out another option I may be missing??

Thank You all for your time.

FT

[mauimalia]

Hi FT,
You found a good place for information. I am in a similar situation, however, my home is in Orange County. We almost bought a home in Yucaipa a few years back. It was absolutely booming there. All the homes were new and on the golf course and were in the high 500k's. Essentially, we are at your payment threshold now and should never have gotten to this point. The one thing I wanted to share with you is that you and your spouse need to communicate. I also have three young children and yes, they are picking up on my subtle expressions of total frustration, but this is not something that is going to go away. I am doing all the faxing and calls, allowing my husband to work and focus because I essentially am losing my mind. Unfortuntely, there are a LOT of us out there. Poppy, *** and Moe, amongst others are very supportive and helpful. The Inland Empire and Sacramento have been hit hard and I'm sorry that you are going through this right now. It is difficult.

Maria

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

I am so sorry for your problems and the feelings that you are going through now, the decision is very hard and I know that it is something that you have thought through carefully.

Please, please do retain an attorney, try NACA for a referral National Association of Consumer Advocates – Consumer Protection Advocates and Attorneys, they are a consume advocacy group and can refer to a good attorney in your area, if not there is one associated with the site that does this work.

What you are going through, do not beat yourself up, stay close with your family and hold on to them, they are the things that matter, not the material "stuff". You are not alone and there is life after this, I promise you.

You do need to speak with an attorney, the fact that you are current, maybe a saving grace on these Option ARMS...they are now having to start to address them and modify and not just a .50 cut on the stinking margin. They are really having to address them and truly modify them...so that is also something that you need to address as well.

Please, please keep us posted and let us know how you are doing and if you need anything in the way of venting, advice or a good chuckle.

[Feelingtrapped]

Hello Poppy, Maria,

Thank you for the responses. I will bring my wife in on the situation and explain our position and why I have been a "ghost " lately trying to work my way out of this.

I will also look into legal advice and check on my options if I have any. Thank you all for the support and I will keep you informed on my progress.

Good Luck to all.
FT

Please keep us posted and stay strong...

[Feelingtrapped]

Originally Posted by mauimalia

Hi FT,
You found a good place for information. I am in a similar situation, however, my home is in Orange County. We almost bought a home in Yucaipa a few years back. It was absolutely booming there. All the homes were new and on the golf course and were in the high 500k's. Essentially, we are at your payment threshold now and should never have gotten to this point. The one thing I wanted to share with you is that you and your spouse need to communicate. I also have three young children and yes, they are picking up on my subtle expressions of total frustration, but this is not something that is going to go away. I am doing all the faxing and calls, allowing my husband to work and focus because I essentially am losing my mind. Unfortuntely, there are a LOT of us out there. Poppy, *** and Moe, amongst others are very supportive and helpful. The Inland Empire and Sacramento have been hit hard and I'm sorry that you are going through this right now. It is difficult.

Maria

Hi Maria,

Thank you for sharing your story. I followed your posts and understand your position right now. I cant belive people will not rent to you because of this now common process you are going through. I have seen some home listed on craigslist that indicate they will work with those of us in foreclosure, so dont give up.

It is this exact reason I will not let the loss process of my home determine my future living conditions. I will not allow a late payment to damage my credit report before finding new housing. If I feel I have reached the end of the road and can not move forward with my lender, I will make new living arrangements before taking the credit hit. I will rent, lease, anything to secure a place to live for the three pluse years I will have to deal with after the loss of my home and spend this time rebuilding my credit and savings.

I understand from this board most people are financially hurt before they realize how damaging it can be to thier future living arrangements. This is another unfortunate bi-product of a very bad situation in my opinion.

Good luck to you and your family, I know how you feel!

FT

[mauimalia]

Thanks FT for your kind words. I haven't given up on Chase or finding somewhere to live. I'm just taking things one step at a time.

Maria

Please one of the things you might want to do right away is to speak with you lender about a short sale....find a good agent if the lender is willing and let it rip, this is not a really big problem for your credit and in fact is kind of a non-event to your credit.

Call the first and the second and let them know....that way you will know the lay of the land and what your options are with them. You might also discuss modification and see what their response is to that....nothing ventured, nothing gained. The problem with the Option ARMS is that they are not modifying them before their "time", i.e. fully recast into the horrible payment that is going to result.