Balloon mortgage payment due in July 2010!?

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I currently have a 3 year note on my home and have been faithfully paying for three years…never been late or missed a payment! During the past three years, my ex-husband let his car (which was financed in both of our names) get repossessed. The balance due on the car is $ 17K and my ex refuses to help with payments. I have started making payments on the repossessed amount myself just three months ago. Anyway, with this repossession, I am unable to get a loan to refinance my home. What happens if I don’t get a loan by July??? I have my home up for sale, but have had no interest whatsoever. HELP!

Ok, first of all I no nothing about a mortgage. The mobile home I am currently renting went into foreclosure so I went to the bank today to discuss financing options. My credit is not good (586). This is what the bank offered me – and I don’t really understand. It seems like after 3 years I am going to have to be worried about financing all over again.

The bank offered me a loan for $ 59,000 with interest rate of 8%. My payments would be $ 545 for 3 years then I would have a balloon payment for the remainder (about $ 53,000.)
Please help me understand this – I don’t know if that is good or not 🙁

  1. Reply
    Just there
    January 19, 2011 at 11:25 pm

    You lose your house if you cannot find refinancing.

  2. Reply
    January 20, 2011 at 12:04 am

    If you do not sell or pay the note as you agreed they foreclose, just like it says there on your contract.

  3. Reply
    Hung Phat
    January 20, 2011 at 12:20 am

    Don’t re-pay a back balance on a repossessed car…you won’t get the car back and it’s just money going out…sad to say, he already screwed you on this one.

    You have to find a way to make the balloon payment or refinance (or sell) before it is due. This is why balloon payments, ARMS, interest only and other non-traditional mortgages helped drive the housing crisis to begin with.

  4. Reply
    January 20, 2011 at 1:15 am

    If you are unable to pay the balloon payment in July, the lender will initiate foreclosure.

    Are you working with a Realtor to sell your home? If you home has been in the MLS for more than 30 days with no showings at all, it is overpriced, unappealing to buyers or a combination of both.

    Your Realtor should be advising you on comparable sales in the area and how to make your home more “sellable”.
    With no offers in 30 days, I always advise my sellers to reduce their price.
    If sales in the area indicate that you would have to sell your home for less than you owe, you are now “upside down” or “underwater” on your mortgage.
    Another alternative to avoid foreclosure is a short sale, when you sell your home for less than you owe.
    You will have to prove financial hardship to your lender, prove that you have no assets, and get a letter of agreement to a short sale from the lender.

  5. Reply
    Mister Sarcastic
    January 20, 2011 at 1:48 am

    I agree with the other poster about not paying the car.

    Where are you located? I may be able to help, but I would need more information. Click on my profile and there’s a link to email me if you are interested.

  6. Reply
    Just A Guy
    January 20, 2011 at 2:11 am

    Horrible deal, walk away right now. Basically the bank just told you in plain english is that you have 3 years to make timely payments and come up with a lump(balloon) sum of 53,000 dollars. so it’s one of two things, you foreclose now or take the loan and be prepared to pay that money in three years. I suggest ensuring that you raise your credit score in those three years to possibly get a better interest rate and out of that balloon payment. You are setting yourself up for destruction.

  7. Reply
    Ryan M
    January 20, 2011 at 2:15 am

    For years 1-3 you pay $ 545 PER MONTH. After the 36th payment, you owe the bank ONE LUMP payment of about $ 53,000. It is good if you can make the $ 53,000 payment. If you are buying a mobile home, probably not a good idea.

  8. Reply
    Ben M
    January 20, 2011 at 2:19 am

    A balloon payment is just that..The bank will finance your purchase for 3 years with monthly payments of $ 545.00 with a final payment of the approximately $ 53,000.00 balance remaining at the end of the three years (so yes you will have to go through the financing again). At that time you can refinance the balance or look for other financing for the balance. The advantage is that you will have had three years to improve your credit score and hopefully get better financing. You don’t have to wait for three years, you can start looking as soon as you feel you have improved your credit score.

  9. Reply
    John P D
    January 20, 2011 at 2:43 am

    mobile homes are a terrible investment. they only go down in value. find something else to rent until you can get your credit score up to where you can afford home. run, do not walk, away from this deal.

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