WAMU SUCCESS At Last!!

[Lisa in MN]

Hi Guys,
Mostly just needing to vent here. I am so tired of dealing with this. I see all these news reports on what mortgage companies are doing to "help homeowners", how mortgage companies "don't want your home" and on and on. I see very little actually being done for people- myself included. While I know I am responsible for our current situation and I feel very guilty about not paying my mortgage and letting it go to foreclosure, I strongly feel we were taken advantage of predatory lending back in 2000. I have tried to play the game all these years and would up worse off than ever. I have been ignored, treated badly and outright lied to by WAMU representatives and as far as I am concerned I am DONE dealing with them. I have called Hope Now- had to leave a message for someone to call me back. WAMU refused to tell me who the investor is on our loan so Wednesday I called freddie mac- they are not, and I left a message for Fannie mae to see if it is that entity. MERS only gives info on servicers, so that went nowhere. I have composed a letter to Chase CEO which I will fax later today. I will contact the bank that was willing to try to get WAMU to agree to a short refi- to see if they will reopen our file ( I wanted to try to negotiate with WAMU on my own because someone said they will respond better to the homeowner better than a bank or attorney- what a joke that is). Beyond that I am DONE. The sheriffs sale was extended to Jan 4 while in loan mod status- which was a joke- and in MN we have a 6 month redemption period. So, I will plan to find a lovely rental and move once school is out for my daughter.
I am done having any kind of hope, only to be constantly frustrated and let down.
I have done all I can.
Best wishes to all of us struggling. This time of the year always reminds me of what truly is important. A house is just 4 walls until you make it a home yourself. I have to continue to stay in that mindset with my house of 18 years.

Happy Holidays
Lisa- sad but resigned it will be ok whatever the outcome

[hjova]

My heart goes out to you. I just wanted you to know you're not alone.

I have lived in my home for 14 years. I had no choice but to re-finance 2 1/2 years ago in order to get my home put in my name and out of my ex-husbands after our divorce. My house payment went up $1000.00 over night! But I felt it was worth it because I would evenually be able to re-finance and my kids would get to stay in the home they felt safe in.

So took a 9% starting interest rate which has now climbed to almost 10%. I can't re-fi and it's set to jump again. But I just can't keep up with those high payments! After 3 months of hard work w/ my lender I was told I would get a loan modification only to be told a week later NO!

I have put so much time and energy into this it has about killed me! I just want my life back. I just hired the attorney they recommend here to try to negoiate for me. I'm currently 60 days late and feel like I'm in limbo. Do I put up my Christmas tree? Do I tell my kids? Do I look for a new place to live?
It's a bad feeling I know...but I just couldn't fight my lender longer. I'm drained. It's very unfair.

I wish you & your family the best...you have done so much you truly deserve it.

[Moe Bedard]

hjova,

If for nothing else in this uncertain economical time.............the one constant in your life will always be your family..........don't change anything about your normal holiday routine...........put up the tree, lights, and anyway else you have celebrated the holidays past.......even though for you it may be even more difficult at this time................do it for your kids...........after all what is going on is not your fault.........or their fault either........with the love and support of your family at home and your new friends here at Loan Safe, this too shall pass............
Happy Holidays to you and your family

[hjova]

Thank you ***...I think I needed to hear that right now. I appreciate it...

[Lisa in MN]

Hi Everyone,
I am sorry to not post this in my original thread but I can't find it, so I started a new one.
After months and months of run around and the usual crapola with WAMU, it took a letter to the executives at Chase to get me a call by someone in WAMU's Quality Assurance department, who in turn forwarded me to a supervisor in the loan modification department, and today she called me with an offer. I will post that first:
Step Rate Loan Modification:
5 yrs
Year 1- interest rate 1%
Year 2 Interest rate 2.33%
Year 3 -3.667 %
Year 4- 5 % which is fixed for the life of the loan.

I think this is very reasonable when viewed by itself.
The questions I have are as follows:
1. They have tacked our late fees, attorney fees, etc... on there. Bringing the mortgage to 318,000 on a property that is now worth less that 250,000. While the mod is I feel a good one, it still keeps us in a mortgage that we believe was based on an inflated appraisal back in Oct 06. Will we ever have the value of what the mortgage is in our home?

2. Do you think it would be worth it to try to negotiate a little more such as reducing the principal to todays value, and a little higher interest rate for the term of the loan?

3.Since this would be a re-writing of the same loan, we could accept the terms now and still follow up with a document review regarding that appraisal and see if anything happens from that, or do you give up any rights to anything further once you accept a loan mod offer?

Thanks guys!
I am feeling pretty good, because if we accept, it will give us a chance to rebuild.
My brother ( the CPA) thinks we have absolutely nothing to lose by asking our negotiator to approach the investors with a counter offer of sorts. I am going to have him crunch some numbers.

Happy Holidays
Lisa

[Moe Bedard]

Well it's about time..........

Congratulations!!

Good Luck trying to pursuade them to accept a counter!

[Lisa in MN]

Thanks ***! Do you ever sleep? You are always so prompt in your replies
Anyway I thought......I am going to ask them to NOT include all the late stuff, what we havent paid , attorney fees, etc.... and keep these terms the same. If they wont accept it, we will accept these terms and continue pursuing the appraisal fraud. I justhave to make sure we can still do that and by accepting the modification we arent giving up any future issue.

Lisa

[Lisa in MN]

Hi Everyone,
Here is the email I just sent to my WAMU loan mod contact. Input expected and hoped for! (Be kind and diplomatic- I already sent it and I have nothing to lose!!!!! Thanks

Lisa

Thank you for your phone call this afternoon.

Prior to having our attorney review the offer our investors have given, I would like to see if you could approach them with the following:

Do not add past due amount, late fees, attorney fees or anything to the principal, and proceed with the Step Rate Modification. With this increase in principal, the modification essentially keeps us renters as we will more than likely never regain the appraised value this mortgage was based on. If we turned around to see our house in even 10 years we would owe more than we could sell it for. Keeping the principal under 300,000 reduces this likelihood as we have seen what houses sell for in our town.It is not my intent to be greedy or ungrateful for the offer that is currently on the table- I am better informed than I have been in the past, and thinking long term- something had I done 8 yrs ago, would not be in this mess. My not adding the above mentioned fees into the principal, investors still come out better than a foreclosure, and we don't have to move. Walking away makes the most sense from a purely business standpoint, even if they agree to my request, but not from an ethical one.Does acceptance of this modification as it is prevent us from any future litigation should our Real Estate attorney find TILA violations in our mortgage documentation?

What I am proposing benefits everyone involved. Had we been able to get assistance and cooperation from anyone at Washington Mutual, we would never have missed 9 mortgage payments. I know this is not your fault April, you have acknowledged the poor customer service and apologized for it and have been the kindest person I have dealt with at Washington Mutual, and you have been wonderful. The investors need to know we tried to do everything to communicate with the company they have hired to service loans and met with nothing but resistance- until you.

Please let me know what you find out. I have made an appointment with our attorney for Tuesday, December 23rd. If the investors will agree to my suggestion, we will not need the meeting and will save 250.00 and will sign the modification immediately upon reciept.

Have a good day and thank you once again for all you have done.

[Lisa in MN]

Moe, or *** or Daniel,

Any insight on the loan mod we were offered? Any thoughts on my "counter offer?"
Lisa

[Moe Bedard]

Lisa...........I already gave my 2 cents when I wished you good luck....


I personally think the mod is a great one.

[Lisa in MN]

Thanks ***,
I have made an appointment with a real estate attorney to review or original loan docs before I accept the modification.

I will keep everyoneposted
Lisa

[The Professor]

I agree with ***. Point in all of this is it gives you the opportunity to see where the market heads and eventually, you can make the decision to either continue with the modification terms as the interest rate increases or just let them foreclose. At least through year 2, your payments should be manageable.

Take care,

Daniel

[Lisa in MN]

Hi Daniel,
Thank you. I also think it is a good mod offer. However I am meeting with an attorney to review the original loan docs for the inflated appraisal, prior to agreeing to pay for a house in which we are 100,000 underwater, no matter what the payment is. I want them to forgive the 8 missed payments and forgive the late fees, attorney fees, etc....these fees and such put the principal at 318,000. It could force us to stay here forever because we will never get that maybe not for many many years if we wanted to sell the house. Good point Daniel. I will see what happens after meeting with the attorney and keep the board posted .
Thanks for the insight
Lisa
I also was wondering.....we will be paying down mortgage principal during the first 3 years, then when it goes to 5%, why would we still be paying 5% on 318,000

[The Professor]

I would google "amortization table" and use one of the available calculators to answer your question. My guess is your payment during this interest modification period is "interest only" and I don't necessarily think that is a bad thing. Rather than reduce the principal with a larger payment, I'd suggest you simply open a savings account and place the payment differential (between an interest only payment and a fully amortized payment) in the savings account. That way, when you reach a decision point (recognizing the primary benefit of this workout is it gives you the ability to delay the foreclosure decision for a few years where you will have a better idea of whether it makes sense to continue down this home purchasing route), if you choose to let the home go you won't lose the principal reduction you would have achieved.

Take care,

Daniel

[LHarveyMadman]

Originally Posted by Lisa in MN

Hi Daniel,
Thank you. I also think it is a good mod offer. However I am meeting with an attorney to review the original loan docs for the inflated appraisal, prior to agreeing to pay for a house in which we are 100,000 underwater, no matter what the payment is. I want them to forgive the 8 missed payments and forgive the late fees, attorney fees, etc....these fees and such put the principal at 318,000. It could force us to stay here forever because we will never get that maybe not for many many years if we wanted to sell the house. Good point Daniel. I will see what happens after meeting with the attorney and keep the board posted .
Thanks for the insight
Lisa
I also was wondering.....we will be paying down mortgage principal during the first 3 years, then when it goes to 5%, why would we still be paying 5% on 318,000

Does the modification offer actually say that your principal balance will be unchanged after 3 years? If this loan is fully amortized, then this shouldn't be the case. Based on my quick calculations, by the end of year 3 your principal balance should be down to about $295,000. Check to make sure that that the payments during years 1-3 really are principal + interest, not interest-only.

[Lisa in MN]

Hello Mr. Madman
I checked with my negotiator based on what you and Daniel said. She said this is a principal and interest payment- not just interest. She also said I should be recieving the documents soon and she hopes they arrive by the time I meet with the attorney on 12/30.
So, shouldnt the payment with the interest change each year be based on what the principal balance is before the new interest rate starts?
I am so ignorant with this stuff and I thank all of you in advance for the explainations!
Lisa

[LHarveyMadman]

Yes, the payment will gradually go up as the interest rate goes up. In the first year, with a starting principal balance of $318,000, your principal and interest payments should be $1023. This does not include any PMI, property tax, or insurance.

After the first year, your principal balance should be $299,637. This will be amortized over 29 years (since that's the number of years left on the 30 year loan). And I see that I made an error my initial response, because the principal balance after year 2 will be $292,318. The monthly P&I payment during this year would be about $1185.

During year 3, the $292,318 will be amortized over 28 years at 3.667%. Your monthly payment should be about $1393, and your ending principal balance would be $286,220. For the remainder of the life of the loan (27 years at 5%) your monthly payment would be about $1612.

So by the time your interest rate resets to 5%, you would have paid off a little more than $30,000 in principal. That's pretty good. By the end of year 9, your principal balance will be down to around $250,000. By that time, one would hope that homes would have started a slow, steady, and logical appreciation in value.

All calculations were done using Yahoo's mortgage calculator.

[LHarveyMadman]

Lisa, when you folks refinanced in 2006, what was the balance on the loan that was closed out? What was the original principal balance on your current loan? And lastly, what was the principal balance when you stopped making payments last spring?

The reason why I'm asking these questions is because I'm worried that you're going to encounter resistance with your proposal to forgive all the past due balances, attorney fees, etc. If your current loan was a cash-out refinance of the prior loan, your lender may ask what you spent this extra money on. So, you need to be prepared with your answer. If the money was not spent on improvement/renovations of the house, then they may be less likely to negotiate with you. They might say that at the time of refinance, you accepted the higher appraisal, took the money, spent it on other things, and are now asking them to forgive a big chunk of your obligation to them. In essence, they could argue that you were content with with higher appraisal when it benefited you, but are challenging it now because it no longer does.

The principal balance when payments were stopped is important to determine because when WaMu adds the missed payments to the principal, it should only add the accumulated interest. Make sure that this is the case before agreeing to the modification.

[Lisa in MN]

Hi Mr Madman
The original principal balance was 297,000 based on the appraisal. I believe it was 90% LTV- there was zero cash out/back to us. We accepted the higher appraisal because when I questioned it- I had asked our meighbor who sold real estate at the time and she said NO WAY- 330,000- she said 280,000 TOPS- the mortgage broker said " Trust the appraiser, she is the expert. If I had a tooth question I would go to your office, not my auto mechanic" ) Made me feel like an idiot!)
The amount in arrears from when the payments stopped is only the interest, but once I recieve the documents and have the attorney review them I will know for sure. The total I was given doesnt even match the total of the past due payments let alone late fees, attorney fees, etc...
WAMU has already refused to forgive the past due stuff. I figured that, so I have an appointment with the attorney on Dec 30th. Hopefully I will have the WAMU docs by then.
I can't help but wonder why they have given such a good mod. They have not responded to my QWR I sent in OCtober and the last I heard ( 2 weeks ago) they were "still working on it" I trust no one,,,,, hence the attorney. I am wondering if they found some issues with the loan themselves so want to "settle" to avoid us pressing it further ( the inflated appraisal, etc...)
Thank you so much for taking the time to ask these intelligent questions...I would not have thought of them on my own. And thank you for thinking of my situation and responding.
Happy and joyous holidays to you

Lisa

[tracercbd1]

Hi LisaMN,

This is STILL GREAT NEWS!! I agree with Professor Shays - the bottom line is this buys you some time while you see where the market goes, and can stash some $$$ away in the process.

What a great holiday gift for you and your family (IMO). We finally got our paperwork last Friday, and our terms aren't nearly as good as yours, but it will buy us TIME, which is what we really needed to sort things out.

Just so you know...WAMU has chosen these "graduated" schedules as the flavor of the month apparently, because that's what we got too. The would not forgive the past due/interest, and just tacked it onto the back of the loan. They also did not do or consider a principal reduction, which would have cost them dearly, since we are approx. still $200,000 upside down on this house.

Ours is 1% the first year (interest only), 3% the second year, and 5% the 3rd year - which will bring our payment up to what it was before, including our impound accounts. HOWEVER, our payment drops $1,100.00 per month for year 1, and we can approach them for something better after we have made all of our payments the first year - which we might just do, depending upon the state of the economy, and the new administration and their policies taking over next month.

We still are $200,000 upside down, and don't think that will change too much in the next year. But, we have bought some time, and will have the opportunity to stash away the difference between our old payment ($3,250.00) and our new payment ($1,162.00) for an entire YEAR. Sounds good to me. We will deal with the other bits of this one year from now, when more things start to shake out, and we can get a better picture of where bottom is, and where the overall economy is headed. One day or year at a time......

We are viewing this as our Christmas "gift" as we still have a roof over our heads, we are both still employed (me, just barely, but I still have a job at the moment) and we can pay the new mortgage without difficulty at present AND pay off some other bills and put some away. Truly, a gift for our family.

Happy and Blessed Holidays to all on this forum, and DON'T GIVE UP OR GO QUIETLY!!!! Persistence pays off, one way or another, and even if you don't get exactly what you want, there are options out there if you keep fighting.

[LHarveyMadman]

Hi again Lisa,

So if I understand correctly, your current loan was a dollar-for-dollar refinance of your prior loan. If this is the case, then the issue of the inflated appraisal is a moot point. You needed this high appraisal in order to get the loan at all. If your home had appraised for what you thought the true market value was - around $280,000 I think you said - you would have never gotten the refinance in 2006 to begin with, because your loan balance would have exceeded the appraised value. So trying to get a principal reduction based on a presumably dishonest appraisal probably doesn't hold much weight with your lender.

The question I have is whether this new loan from 2006 was actually better than your previous loan. If your broker sold you a loan that was not beneficial to you, then you should consider action against him/her.

Lastly, keep in mind that when you consider your principal balance compared to your home's value, keep in mind that your debt is not solely home debt. You said in post #11 in this thread that you rolled some business debt - I'm guessing that might have been a substantial amount - into a new loan about 7 or 8 years ago. To ask WaMu to lower your principal based on home value alone would be effectively asking them to forgive your business debt. Since you sent a letter to WaMu in which you described this financial move, they are aware of this and are probably less likely to consider a principal reduction.

This is why many people advise people not to consolidate unsecured debt (e.g. credit cards, student loans, business debt) into home equity debt. If you default on this previously unsecured debt, you can lose your home in foreclosure.

Okay, I've blabbed on long enough. Having said all this, I think the offer that you received is excellent. It definitely buys you some time while your financial situation and the housing market improves.

[Lisa in MN]

Sir, you are awesome! You are so right about everything you said and I think I have become so distrustful of this industry in general I am now questioning everything. I think our original predatory issues were with the loan we got for the business debt a long time ago- and now I am p.o'd! I know I must sound like I am ungrateful for this offer but I truly am not- I am highly suspicious of it as to me it seems good to be true. I tried to communicate openly and honestly with WAMU for months----way before we stopped making payments- a decision that we are not proud of.But as my negotiator said when I asked her this question- why they are willing to help me now- she said it is a completely different econonomic situation than it was a year ago. You are obviously wise and well educated in the mortgage industry. Thank you so much for your time and wise words! I know we will accept, I am now waiting for the loan docs to arrive. However, I am still going to have the attorney review them before I sign anything. After all the dealing I have had, from here on out, an attorney will review every single thing I sign!
I am afraid people on here must think I am nuts to be not jumping to accept this mod offer, but jumping to the loan in 06 simpley to lower a monthly payment put me where I am right now- that loan only lowered payment by 250.00 a month but I was desperate. Plus as I said I am so very distrustful.
Harvey, thank you once again sir, and I hope you and your family are enjoying a wonderful holiday season. I hope someday I can help someone feel as good as you have made me feel this Christmas Eve.

Tracer- read above and know that I am not nuts Congrats on your own mod offer! I wonder how they decide these things..... Happy Holidays to you also!

Lisa- feeling warm inside despite MN below zero temp

[LHarveyMadman]

Hmm, Lisa, I can't tell if you're being sarcastic, because I feel like everything I've said my recent posts have been more cautionary and pessimistic. But if you're being sincere, then thanks.

As for why you were offered the modification, the first thing you should know is that banks hate to be homeowners. They don't look to take possession of homes if at all possible. The second thing is that there must have been something positive about your personal situation that made them more inclined to make you an offer. For example, they must have determined that with the new loan terms, you would most likely be able to make all future payments. There's lots of people out there who would not be able to make their payments even if given a modification; I feel that these are the ones who are most likely to be denied.

Again, congratulations on an excellent modification offer. After all your hard work, you deserve it.

[Lisa in MN]

Oh Harvey, I most certianly am not being sarcastic- honest and very sincere. You have addressed issues I had not thought of, and that are true!

You have been a wonderful help and I am truly thankful for your input!
As for getting the loan mod - mostly I cant help but wonder why NOW- when I have been asking for help for a year. It doesnt really matter why I guess, just that it was offered and we will be thankful and graciously accept. We most definately can afford the terms, even when it is at 5%.

Lisa

Happy Holidays

Lisa

[LHarveyMadman]

I'm glad to hear that I hadn't offended or upset you. It's very hard to read facial expressions on these forums!