Home Loans and Support

It's time to walk - Portland

Discussion in 'Deed in Lieu of Foreclosure - Do You Need Help to ' started by lumpsofsugar, Jan 22, 2011.

  1. lumpsofsugar

    lumpsofsugar LoanSafe Member

    Hello everyone!
    First of all, I'm so thankful to all the folks on these forums. Your stories amaze me, but most important, I'm truly inspired by all the courage you all have and the support you give one another. I've decided to post my story too now.

    I live in Portland and purchased my home in 2008 for $385,000. I currently owe for a 1st mortgage (Wells Fargo) $300,000 and a 2nd (also Wells Fargo) $25,000. The 2nd is a HELOC and both loans were taken out at the same time.

    I am so underwater - identical homes in my neighborhood are selling for around $200k.

    I have excellent credit right now and have really struggled with this decision for quite some time, but I've decided my credit will repair faster if I walk away, than if I just stayed and continued to pay. At this point, I will never make up my losses to be able to sell my house, nor will I ever make up the downpayment. I've done the math, and it just doesn't make sense for me to stay, even though I love the home. I have to remember, it's a business decision.

    Here is the breakdown:
    Last payment: 12/1/10
    1st missed payment: 1/1/11
    Owe: $325k
    Comparable homes: $200k

    I've already started getting calls from WF. The calls for the 1st went pretty smooth, but the calls for the 2nd were a nightmare. Talk about harassing. The 2nd is only 10 days late so far, and I was amazed at how hard they were pressing me to pay.

    I need some advice - what should I tell them, or not tell them? They kept asking me if I intend to pay or keep the home. Should I just be up front with them and say take it back, I don't want it anymore??
  2. cmass122

    cmass122 LoanSafe Member

    If walking away, do not EVER talk to them. No point, wait until over 90 days if you even decide to to let them know you are still in the house....even if you arent.

    Also do not give them any financials nothing do not give them a reason why. basically personal issues or something very broad and personal, that you can not talk about etc.

    If they ask you about anything work, income DO NOT give them any info. They will try and send you info for a mod or some bs program, its really just an attempt to get your assets.

    stay away

    best advice I can give is do not answer the phone at all and put yourself into a bad position.

    remember to keep paying HOA fees if you have one.
  3. chcktychna

    chcktychna LoanSafe Member

    I'm in portland too and also have Wells Fargo. I made this difficult decision and my first missed payment was 11/1. If you've noticed from the other posts here, you can also send a cease and desist letter. This worked like a charm for me!!! Not a single call since and they immediately acknowledged that they received it. I pasted it into the "contact us" email through their online system, and sent one via mail as well. Here is the one I used so you copy/paste it.

    I'm waiting anxiously to now get my Notice of Default so I'll then be able to count backwards to figure out my timeline... I'm also going to paste you an awesome short video that spells out the timeline and various required notices in oregon. Take notes and pause if you have to while it's playing... it's awesome! YouTube - Oregon Foreclosure Timeline

    November 29, 2010<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:eek:ffice:eek:ffice" /><o:p></o:p>
    <o:p> </o:p>
    <o:p></o:p>
    Wells Fargo Home Mortgage
    <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:eek:ffice:smarttags" /><st1:address w:st="on"><st1:Street w:st="on">PO Box</st1:Street> 10335</st1:address><o:p></o:p>

    <st1:place w:st="on"><st1:City w:st="on">Des Moines</st1:City>, <st1:State w:st="on">IA</st1:State> <st1:postalCode w:st="on">50306</st1:postalCode></st1:place><o:p></o:p>
    <o:p> </o:p>
    Re: Acct #02xxxxx

    To Whom It May Concern:

    Please accept this notice, pursuant to the Fair Debt Collection Act (FDCPA), that you cease all further telephone communication with me regarding the collection of the debt referenced above. All communication should be directed to me through written correspondence only. Furthermore, do not contact any third parties regarding this debt.

    Failure to comply with this law will result in my immediately filing a complaint with the Federal Trade Commission and the Oregon Attorney General's office. I may pursue all criminal and civil claims against you and your company.

    Let this letter also serve as your warning that I may utilize telephone recording devices in order to document any telephone conversations that we may have in the future.

    Thank you for your prompt attention to this matter.


    Sincerely,<o:p></o:p>
  4. izzle

    izzle LoanSafe Member

    @lumpsofsugar:
    I live just across the river in Vancouver, WA... I struggled with the decision to strategically default for a while but decided to go through with it back in August 2010. Its a tough decision but so far it has felt like a huge weight has been lifted... I am still waiting for the Notice of sale which I expect anytime now.

    If you want details I have documented my walk here -> http://www.loansafe.org/forum/deed-...provident-funding-1st-boa-2nd.html#post311120

    Good luck. As far as contact. Read my post and you can understand why I will not talk to them or answer the phone calls. I would send in a letter to tell them to stop calling. Its not worth the stress.
  5. Dr Moreau

    Dr Moreau LoanSafe Member

    I would really recommend sending a cease and desist letter to your second ASAP. My second, SLS, calls as much as 11 times per day. They make it very clear they want you to pay them in full, regardless of the fact your house is unsuitable for your family and even your first mortgage is underwater by $70K. They are rude and aggressive.

    I did not send my first mortgage a cease and desist letter and will occasionally pick up the phone. I'd like to stay on good graces with them as long as possible.

    I agree with @cmass122. Do not give them financials. If you are walking, focus all your energies on that process and don't string them along with fake loan modifications.

    I am in the same boat as you, we made our last payments 01/01/11. You can follow my story here:

    http://www.loansafe.org/forum/foreclosures/37250-my-walk-long-version-seattle-wa.html
  6. chattykathy

    chattykathy LoanSafe Member

    Dr. Moreau et.al. I agree with this.

    I never talk to the bank on the phone. Learned that lesson the hard way, as I'm sure you all have. If they deign to leave a real message, I call them back. Otherwise I forget it. If you send the cease and desist letter, then when they call you can, if you want, remind them that they are inviolation of the law and must stop. Now.

    If you are walking, also wait till the last minute so you can get "cash for keys." Every little bit helps!
  7. lumpsofsugar

    lumpsofsugar LoanSafe Member

    Hi all,
    Thanks for the feedback (and the video was VERY informative). I think I will heed the advice and not talk to them anymore until I get farther along in the process. When I talked to WF for the 2nd, I was pretty shocked at how pushy and rude they were, even after being only 10 days late. The guy kept asking me the same questions over and over like 1) where do you work, 2) why aren't you paying, 3) when are you going to pay, 4) are you living there, 5) we need to update your financial information blah blah blah. I told him the same answer each time but, he finally asked:

    "mam, you're going to live in your house, and just not pay for it?" Ugh, what do you say to a question like that without incriminating yourself??

    I kinda lost it at that point and told him he was RUDE. I've decided from now on I'm just not going to answer - I can't take that kind of stress.

    @chcktychna - definitely gonna use the cease and desist letter you sent me. Great idea!

    I do have an attorney appt this week, so will pass along any info I get that may be of value to all.

    I would really like to speed up this process a little because I've already found another place to live. Should I just move out and not tell them? or just be up front, and say I'm moving out, take the house back please? I read my homeowners insurance policy and it specifically states 'residence premises', which means owner occupied, so if I move out, does that mean I don't have homeowners insurance anymore??

    So many questions...
  8. chcktychna

    chcktychna LoanSafe Member

    I wouldn't recommend you leave the home. I believe that opens you up for recourse on the deficiency, or at least taxation implications. As long as you stay in the home until the end and do a straight foreclosure (not short sale or DIL), you are mostly protected in Oregon from defiency, and taxations with 1099s.
    Besides, staying for at least a while will save you money.

    When is your attorney appointment? Will you tell me what you thought of him/her? I wouldn't mind running off my gameplan and knowledge to someone and just making sure I know everything I need to know.
  9. lumpsofsugar

    lumpsofsugar LoanSafe Member

    @ChckTychna
    My atty appointment is Tuesday and definitely I'd be happy to share what I learn. Consultation is $150 for them, and even if I just get peace of mind, it's money well spent for me. If anything, it's therapy. Ha ha. I can send u their name if you like?
  10. chcktychna

    chcktychna LoanSafe Member

    Sure that would be great. Basically, I just want to be able to ramble my details and tell them what I think the options are and why and see if I'm missing anything. $150 is pretty cheap...

    Be leary... a lot of them actually know very little and just want your money... there are tons of posts on here about attorney's that are incompetent, unfamiliar with the real rules and variables between situations, or even actually on the side of the mortgage industry.
  11. lumpsofsugar

    lumpsofsugar LoanSafe Member

    ***UPDATE***

    Had my attorney appointment and it went about as I expected. In a nutshell, here is what I learned:
    -almost all Oregon foreclosures are filed non-judicial (like 99.9%)
    -attorney reviewed my loan docs, which are the standard "Deed of Trust". this means it's nonrecourse. their only recourse is to take the property back after foreclosure
    -attorney recommended I speak to the bank once and tell them I'm not paying and don't give reasons why. also recommended I tell them to only contact me in writing.
    -on the 2nd loan, it's technically nonrecourse but they could try to sue me for up to 6 years, but won't likely
    -the home is my primary residence since I've lived there for years, and that makes the foreclosure qualify for the 'Mortgage Debt Forgiveness' for tax purposes

    I've had TONS of calls from the bank. All went to my voicemail. Lots of blank messages, lots of the standard message 'please call us back blah blah blah and one message sounding like someone chewing gum. Oh, and I did receive some calls from a LOCAL bank branch, which freaked me out a little. I don't know if that's standard or not. Guessing they'll do a drive-by soon.
  12. chcktychna

    chcktychna LoanSafe Member

    Thank you for sharing... that confirms my research!

    Love this site!
  13. lumpsofsugar

    lumpsofsugar LoanSafe Member

    ***UPDATE***

    So I subscribed to one of those credit monitoring services a while ago. A few days ago I received a notification of a potentially negative item. As I expected, WF reported me late and my score went down 60 points! That was after 1 missed payment, but now I'm actually 2 payments behind, so I'm guessing my score will go down again next month.

    I've received almost daily calls from them, but it's all computer robo calling. A few soft letters in the mail, but nothing serious yet.

    Funny, how at first I was freaked out about them calling, now they've called so many times, I'm almost callous about it.

    The credit score drop I expected, but it was still tough to see that. I work so hard to keep a high score and it's amazing how fast it drops. But I don't care, I know in the long run it's the right thing for me to walk away. It will go back up, but whatever, I'm saving a lot of money right now and doing what's best for me.

    Time for some wine now.
    1 person likes this.
  14. lumpsofsugar

    lumpsofsugar LoanSafe Member

    ***UPDATE***

    I received my Notice of intent to Accelerate. I have until early march to bring the note current, or they will call the entire loan due. Letter also said they will proceed with foreclosure after that, which I say please do!! I have two loans though, so I'm wondering if I will receive two of these letters, or just the one? Seems like everything so far has been in duplicate (phone calls, soft letters etc).

    They are calling a lot lately, but I don't answer. Not planning to call them back anytime soon, although I may call back and tell them I have plans to move out and maybe that will help speed things up a little?
  15. gettinout

    gettinout LoanSafe Member

    If WF is anything like Chase, then their promise to proceed is more or less meaningless. I've received, I think, 7 or 8 of these letters and about every other one says this is their final attempt to communicate/help/whatever and after this they will proceed with foreclosure. I'm with you, Please Do!!! but don't count on it any time soon.
  16. lumpsofsugar

    lumpsofsugar LoanSafe Member

    ***UPDATE***

    I've been out of town for a few days, but when I got back, had a new letter from them. Basically, the letter says I have the following options:

    --repayment plan
    --loan mod
    --short sale
    --deed in lieu

    Letter also said I need to be prepared with all my financial info to give them when I call back. Ummm, ya no. I think NOT.

    Lots of phone calls. Daily, multiple times per day. I've asked twice now for them to not call my work, but they still do but conveniently don't leave a message there. But lots of messages on my home and cell. Still undecided on cease and desist letter - I kinda want to keep tabs on them bcuz I really want to speed up this process.

    I'm almost 60 days late so far. No plans for any of the above options.
  17. lumpsofsugar

    lumpsofsugar LoanSafe Member

    ***UPDATE***
    Boy, I had a busy mailbox today. Here's what I received

    --statement saying I'm past due and I owe xx dollars
    --letter about the "service member civil relief act". (huh??? I'm not in the military). Explains about homeownership counseling
    --making home affordable letter explaining the process

    I'm assuming the last 2 are standard protocol. I keep checking sites for NOD, but nothing yet. Thinking it will show up around 90 days
  18. Screwed11

    Screwed11 LoanSafe Member

    This is worrisome. Is this even if the loans are 100% purchase money and non-recourse?????



    Oh. My. God. They'd try?????? I am actually MORE worried about my second (and third and fourth), which would all be completely WIPED OUT by the foreclosure. Why would the second even waste time, and money, by suing on a non-recourse??? Did your lawyer explain the reasoning (aside from trying to make your life miserable - and I would hope that the banks are above this petty nonsense and throwing money away in suing on non-recourse loans by making this a personal problem as opposed to a business issue)




    This is my question. We plan to find a rental in a good district first before defaulting. I am under enormous stress and I don't even want the free rent, thank you very much. This might technically make my foreclosing home as not my primary residence - would this create any tax issues for us???

    Could anyone clarify? Thanks!
  19. lumpsofsugar

    lumpsofsugar LoanSafe Member

    Screwed11

    On the primary residence question, the way I understand it from the attorney and tax accountant, is if you've lived there 3 out of last 5 years, it's your primary, thus qualifying it for tax forgiveness act. But your clock does start ticking once you move out.

    As for the 2nd loan, the bank most likely will not sue for deficiency (at least in Oregon, not sure on other states). My 2nd loan docs clearly state the loan is secured only by the house, not me personally. But the attorney did tell me they could ( not likely, and no cases so far) sue for deficiency, up to 6 years. I really doubt they would win. Former governor Kulongoski signed a bill into law about this, if the loans were taken out at the same time. Check out this link for details

    Oregon.gov/dcbs/foreclosurehelp/laws.shtml
  20. gettinout

    gettinout LoanSafe Member

    I am in the same boat. The issue of primary residence does seem to have garnered some debate here and elsewhere and from what I can tell comes down to conflicting IRS definitions of primary residence, both of which might be taken to be the salient one: that is, is it the 2 of 5 years criterion (and I'm pretty sure it's 2 of 5, rather than 3 of 5 though I am not 100%) or is whether not you're living there at the time of foreclosure.

    The way I've settled it for myself is that I'm going to claim my foreclosed home was my primary residence and take the tax break because it truly was in every sense of the word and if I wasn't there on the day it was sold at auction, well that had more to do with the banks timeline (which I have no way of predicting) than with the fact that I moved out when I did.

    If the IRS decides to audit me and question my claim, I'll be happy to explain this reasoning. Maybe they still try to shake me down for taxes on the 'income' of the discharged debt. But the last thing I'm going to do is fork over money that they haven't even asked for and that I honestly don't believe I owe. If they really want it, then they will have to make their case.

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