Help for mom in Texas

[chefette]

Hi,

I am a nervous wreck over this whole situation. Will try to be brief so that I may get some feedback on my story.

I am currently in a home that we built in 1999. We have been through many hardships in the past 5 years.

The worst of them happened in March of 2007 when my husband was in a motorcycle accident which left him unable to work for over 1 year and I could not work because he needed assitance and I have 2 children. This depleted our resources.

We have an ARM with fluxuating interest. We are in negative amortization for nearly $23,000. (the arm was a refinance, original loan was for $250,000) This Arm is supposed to "come due" in July of this year. I cannot even pay the current 5.87% interest that they gave me last month, what is going to happen to me in July? We also have a second with Chase Home Finance with a low interest of 5.875% for the amount of $72017.00

Tried to refinance after my husband first got a job, but we, like many others are upside down and the house appraisal came in under 100k of what the bank wanted. Soooo we tried to suck up and pay off some of that amorizaion. We did this for 6 months. The money just isnt there. Our taxes are not escrowed, nor is our house insurance. We literally live hand to mouth and heaven forbid something breaks, like a water heater or a fridge. The house needs repairs to make it marketable.

I do not see how a mod will help us. I would like to repair the home and get out. But to do this I would have to use mort. money to make the repairs.

Does anyone out there think I should try to mod. loan? Should I stop making payments and repair home and get it on market asap? This whole business makes me sick, I hate being so stuck. Have tried real hard to get work, but so far market is tight. Any words of wisdom welcome.

[Moe Bedard]

Hi chefette,

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


Unfortunately a modification on this type of loan with the rate of 5.87% will actually raise your payment because they will put the negative interest back into the principle...........so that won't be able to help. Also you wouldn't need to make the repairs if you are approved to do a short sale..........your agent would just need to market the property as is.

Who is the lender on the first?

[The Professor]

Were it not for the fact that in Texas, lenders are permitted to seek a deficiency against you after they foreclose on your home, I would be suggesting that you consider just walking away. But that isn't the case. What may help is for your to contact one of the consumer non-profits that *** suggests borrowers utilize.

Daniel

[chefette]

Thank you so much for answering my questions. This forum is great, but sometimes all the info can be overwhelming.

The first mort. is with Chevy Chase. I have not yet seen any info reported on them in this forum.

Please correct me if I am wrong, but when July comes and the ARM comes due, my interest rate can go through the roof, yes?

I am sorry if I appear ignorant, but trying to gain as much info before I make decision. I greatly appreciate all of your help and advice. Tomorrow I am going to meet with my realtor, perhaps we can do a short sale before the interest on this loan explodes. God Bless.

[chefette]

Professor,

When you say "seek deficiency" You mean that if the house is sold under the amount of mort. they can come after me?

I think I can sell home to cover the first, and part of the second. Will let you know my progress. Many thanks.

[Enough Already]

Hi Chefette,

I just read your thread. Do you have an update? Are you trying for a short sale? Any luck?

Thank you!