FHA loans underwater house?

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Any help on this would be greatly appreciated. I currently have two loans on my first house in East Metro area .. My first loan with the Bank Carrington $ 568,000, including interest payments of 5.75%, the loan has a number of violations of the original documents (such as 40 year loan is 30 years, etc.), and we are now changing, and my lawyer. The proposed payment is reduced by 5.25% and the loan is 30 years. Now, the second loan is the Bank of America 11.4% and a payment of about 1,400.00 with a balance of $ 137,000. Tried since the second owner got sick (and not be able to pay) for a change of banks fair. A struggled for almost two years now. If your mortgage payment is higher than 85% of your income, you can say shit least.My questions are those capable of answer.1) what are my chances of a new plan for one year FHA loans have both changed? Bank of America’s response to my loan mod was to increase the rate last year (09). If I can not, what programs are available for my family and me? Is this their way to one or two of them, a bank may forgive part of the loan, so I can get a new FHA loan. There is no way the bank has worked with me at all. This is the sixth time I tried modificiation. As many people say, we can offer the world, and do nothing when it comes. Is it worth going to court forelcosure NYS? I think it will force the Bank’s work with me fairly, rather than a greedy manner? Short selling is not the solution, because the house is under water more than $ 100,000 and the bank does not accept it. In closing, what can I expect? I do not want to interfere with another owner, who is ill, doing it yourself. I’m married (not to be much longer), and her husband works, but this is not a loan because the house was bought before our marriage. So you can see the mess, he became for all concerned. Any help you can offer in this regard is greatly appreciated, thank you.

2 Comments
  1. Reply
    steve299
    January 25, 2011 at 11:07 pm

    You are lucky your wife is not on that loan. Her credit will not be affected by this mess. This housing crisis has affected everyone. My loan is 7.85% and the bank will NOT BUDGE. They laughed at me and said “This isn’t lets make a deal”. Worse, since I asked for a modification, they put us on a last of possible forclosures and a realitor actually trespassed all over my property, peaked through the windows, and left a note on my front door commented on how cute my indoor dog is. Banks will not work with anyone. The Fed should have bailed out homeowners, not the banks. If worse comes to worse at least your wife can rent a house, apartment, or even purchase another house at half the price of 3 years ago. I would rent a house for 5 years and wait for the forclosure to get off of your credit. My home is worth 100K below what I owe and continues to drop. The downfall of an FHA Mortgage is your must buy mortgage insurance that will cost you over 100K over the life of the loan. Also, mortgage ins is not deductable. Do not let this economic meltdown affect your marriage. This is NOT your fault. The banks don’t care about their real estate loans since they were already bailed out.

  2. Reply
    Paul
    January 25, 2011 at 11:09 pm

    As you are finding out, loan mod’s don’t work because you are asking the bank for help and they aren’t going to give you any (real help).

    You mentioned violations in the original documents. If you haven’t already, you might want to consider a forensic audit of your loan process. Lenders have many requirements that they are supposed to follow when making a loan and in the last few years have not fulfilled their requirements.

    Nearly all loans that were – ARM’s, Stated Income, Investor, No Doc, had a prepayment penalty, were made to someone speaking a foreign language – were made out of compliance. The audit will show what the lender has done in violation of the lending requirements.

    You use their violations of RESPA, TILA and Predatory Lending laws to give yourself a position of strength in dealing with them, instead of being under their thumb begging for help.

    People can use this information to force a lender to negotiate a reduction of the principal amount, interest rate, the payment, or to complete a short sale.

    Good Luck!

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