Down, but not out

[1ofhiselect]

Suddenly I realized that the home my family and I had built lost what appears to be a substantial amount if not all of the equity (maybe it was wishfull thinking to believe the appraised value could really be worth that much anyways!) within a matter of months. Beautifully set among the tall pines and cedars, this property is on almost an acre in town (California). The home had an appraised value of 720,000 as of 12/06. Our first mortgage is for 468,000 which just adjusted upwards in Nov. '07 by about 400/Mo.(GMAC) and our HELOC is 101,000 (Citi). This puts us at 569,000 worth of mortgages and a home valued @ somewhere around 576,000 if you believe values have dropped 20%. That doesn't leave us much equity and our monthly mortgage outgoing is about 3,700.00. I would like to take advantage of these lower interest rates and get out from under the adjustable and the variable HELOC. We listed it with a very good local broker and tried to sell for just over 3 months. No one even came to look at it. OK the price was lowered 9% and still no one. Finally,we just took it off the market. The other part to this is that we just completed construction of another home nearby and now must pay for that one as well. Since then, we have been unable to pay for the first house at all and are now 60 days behind on both the first mtg. and the HELOC. Now I am Credit challenged because of the lates on these mtg.'s. Hoping to get a renter in there soon but what can I do to reduce the monthly outlay and prevent this gorgeous property from going into foreclosure? Any help out there for a guy like me?

1ofhiselect

[Mary Salzer]

Welcome to the forum and thank you for joining us and sharing your story.

You do need to get with GMAC and arrange for Modification of the First Mortgage to a more manageable payment.....their choices are not pretty either. Please engage with the Lender regarding the situation you find yourselves in and fast.

Have you moved into the new property yet? What are the chances of selling it (the new one) versus the sale of the old one which were not very viable? What are the chances of getting a renter? Also are the obligations that you are referring to purchase money obligations or refinance obligations? Do you have a plan if you can speak with GMAC so that they see the benefit of Modification? Any other details you can think of would help as well.

As you may have read in the forum postings, GMAC runs hot and cold on the Modification situation. There was a posting today of success, so there is hope.