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She was fine for years when it was at $1400 but when the bank got greedy and jacked it to $2380 in one month I seriously doubt there are that many people here on the forum that could find in their budget the extra $980 without selling their car or going hungry.
She signed up for it. Most adjustable rates say something like "adjustable interest rate not to exceed 18%, rate will change on such and such date" Well, the date arrived, and the rate jumped. Just like she signed up for. Its not greed. Its in the contract. If she didn't know what she was signing, she should not have signed it. So, no, I have no sympathy.
You're splitting hairs. Your client did something dumb, and the bank made a less than transparent decision to foreclose. Let's switch things around a bit and say the only way to get a loan was to sell a kidney, then years later her other kidney failed. Does that somehow entitle her to get the first kidney back?
When Said...no sympathy..
Going to bookmark this page why people need to hire attorney's not realtors!.
She cannot sue Bank of America, but could "Sue You" for pushing for a short sale and not trying to save her home.
Being a former loan officer, willing to bet their credit score impacted the type of they qualified for. The for-mentioned "Bad Loan", that was the only loan available to them at that time. She accepted the loan conditions at the closing, and later defaulted on the loan. Point - she cannot sue the bank....
I am willing to bet you/borrower pushed for the short sale because of the lost equity. She could of qualified for a loan modification; into a fixed lower interest rate, making the payment affordable. The submitted paper work was done was done incorrectly, and the bank decided it was more profitable to foreclose.
What needed to be done was analyze the mortgage to see what the lowest modifiable payment is could be reduced too. Then calculate what was the house hold income, then decided whether a loan modification or a deed in lieu was the correct way to pursue.
In some states a short sale is all you need to do to work with a bank to short sale a property. Other states you need to do a deed in lieu.
Trying to do a short-sale does nothing to prevent a foreclosure for going forward......
Last edited by Modification Specialist; 02-26-2013 at 03:28 PM..
Trying to do a short-sale does nothing to prevent a foreclosure for going forward
True. The bank has tens of thousands of employees and contractors. The short sale people don't talk to the foreclosure people. The foreclosure people continue to do their job unless presented with the proper paperwork to delay foreclosure.
I feel we were all played by the bank and they never intended to short sell the property but instead they had to make it look like they were complying with the rules so they could take advantage of the insurance money.
I think you've hit the nail on the head with that statement.
Quote:
Originally Posted by 399083453
She signed up for it. Most adjustable rates say something like "adjustable interest rate not to exceed 18%, rate will change on such and such date" Well, the date arrived, and the rate jumped. Just like she signed up for. Its not greed. Its in the contract. If she didn't know what she was signing, she should not have signed it. So, no, I have no sympathy.
I beg to differ. It is greed...and it's also stupid, a poor business practice, and a fleecing of taxpayers. A friend had their adjustable rate mortgage raised from 9% to 14% interest--at a time of record low interest rates. The bank foreclosed and they either took a major loss or were made whole by taxpayers, neither an acceptable result. It made absolutely no sense for a bank to decide to receive no payment, when they could have continued to receive a healthy 9% interest on their loan.
Federally-insured mortgages were initially to benefit consumers...but they've essentially become welfare programs for the big banks and their dishonest, greedy executives.
I beg to differ. It is greed...and it's also stupid, a poor business practice, and a fleecing of taxpayers. A friend had their adjustable rate mortgage raised from 9% to 14% interest--at a time of record low interest rates. The bank foreclosed and they either took a major loss or were made whole by taxpayers, neither an acceptable result. It made absolutely no sense for a bank to decide to receive no payment, when they could have continued to receive a healthy 9% interest on their loan.
At some point though, kicking them out is better for the neighborhood home values. If they stayed they'd never be able to refinance or sell, they'd be paying more than double the going rate at 9% of an inflated value, and probably let the place deteriorate. How much did they spend on repairs/renovations after values dropped? How much would they spend going forward on a house with no equity? 0.
In this scenario the house can at least be turned over to someone who will take care of it and pay each month.
A friend had their adjustable rate mortgage raised from 9% to 14% interest--at a time of record low interest rates.
Your friend knowingly signed up for an initially low rate that adjusted to 14% vs a safe 30 year fixed mortgage. They even named the product "adjustable rate mortgage" so there was no confusion. The bank laid out the terms, he read them and signed on the line. They told him they were going to do this. The investors/shareholders expect rates of returns based upon those contracts. To expect the world of contract law to not be relevant because your friend is on hard times is naive.
Quote:
Originally Posted by jackmichigan
Federally-insured mortgages were initially to benefit consumers...but they've essentially become welfare programs for the big banks and their dishonest, greedy executives.
True. But that is a completely new topic.
Last edited by 399083453; 02-26-2013 at 05:17 PM..
Your friend knowingly signed up for an initially low rate that adjusted to 14% vs a safe 30 year fixed mortgage.
Yes, they were foolish, and perhaps a bit gullible to trust anything promoted by a bank official. A higher adjusted interest rate would have been understandable if overall interest rates had gone up, but they had gone down. The bank was simply greedy and stupid--which, in my mind, trumps foolish and gullible by a long shot.
Going to bookmark this page why people need to hire attorney's not realtors!.
She cannot sue Bank of America, but could "Sue You" for pushing for a short sale and not trying to save her home.
Being a former loan officer, willing to bet their credit score impacted the type of they qualified for. The for-mentioned "Bad Loan", that was the only loan available to them at that time. She accepted the loan conditions at the closing, and later defaulted on the loan. Point - she cannot sue the bank....
I am willing to bet you/borrower pushed for the short sale because of the lost equity. She could of qualified for a loan modification; into a fixed lower interest rate, making the payment affordable. The submitted paper work was done was done incorrectly, and the bank decided it was more profitable to foreclose.
What needed to be done was analyze the mortgage to see what the lowest modifiable payment is could be reduced too. Then calculate what was the house hold income, then decided whether a loan modification or a deed in lieu was the correct way to pursue.
In some states a short sale is all you need to do to work with a bank to short sale a property. Other states you need to do a deed in lieu.
Trying to do a short-sale does nothing to prevent a foreclosure for going forward......
This is funny.. I hear great things about loan mods from lenders but I have yet to hear of anyone I know actually getting one..
So if I understand, you and your client were shocked beyond all belief that an adjustable rate mortgage payment increased?
"But...no....consumers don't make any mistakes! Consumers are the victims of the mean old bank, who sent them 50 pages to sign at the beginning of their purchase process, half of which said ADJUSTABLE RATE on them. So now....I should get money from the bank, right? They're supposed to pay me because I was stupid, right?"
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