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I think each person needs to do what is good for them -- in the end, it is your own family's life -- no one else really cares about your family, except your family -- that's just how it is. Take care of yourself, first.
Also, I have Countrywide, too and they are scoundrels. They "forgot" to put two extra land parcels of mine into escrow for my taxes -- it was in the paperwork, but they "neglected" to follow through -- until I got a letter from the Tax Assessor's office! Countrywide kind of "hahahaed" it and made light of it -- but that puts my monthly payment higher than stated (fortunately, they weren't expensive parcels)! I did find out that Bank of America bought out Countrywide, so they are going down that long country road -- "Bye, bye, Countrywide."
I'd venture to guess it's about half and half -- some people just were not budgeting correctly and anticipating costs beforehand, or life threw them a curve ball, and in the other half, I know for sure that people were taken by the brokers/bankers. Unfortunately, it's hard to win a lawsuit against a multi-million-dollar corporation, so we'll hear the sad-sack tales of companies going out of business (but protecting assets), while the little guy gets bashed but receives no compensation.
For the record, I'm not leaving my home -- it's not for sale, I'm not foreclosing, I just see it happening all over. I think many of these bankers are crooks....just my opinion.
I can completely agree. What's funny is that on this board.. or maybe it was another.. peoples answers were to simply get more jobs.. work 2 or 3 jobs each (father and mother). It's just not practical. I mean at what point do you just start dropping kids off with relatives , never seeng htem, never seeing each other.. to keep struggling to pay a mortage that is going nowhere but up if it's an adjustable. It is not healthy physically, mentally or emotionally for hte individual or the family unit. I have personally decided that hanging onto my house just wasn't worth the price I would be paying (beyond money) ty try and stay in my ARM mortgage that I can't even afford the first adjustment (and we were already working hard to afford it in the first place).
That being said, for me the issue was that I had NO idea that the market could do this.. that I wuoldn't be able to refinance because of decreasing home values, putting me at 100% LTV as a stated (because I"m self employed..a nd have no choice) individual. It just didn't play into my "worse case scenario" because it really was an unknown. If my mortgage would just stay where it's at, I could wether it and hang in...even with the tightening economy AND the downturn in value.. but my mortgage is just going to keepgoing up well beyond what is affordable.. and so I'd be overpaying immensely for something loosing value and killing myself in the process.. not to mention not being able to spend time with the hubby or kids..
Most of us in this mess are facing that same issues. .. and for those to say "just get another job" is just.. well ridiculous, unrealistic and not really practical.
So now I'm forced to walk away (because lender isn't cooperating) but I'm doing it as responsibly as possible. And trying hard not to feel like complete poop about it.
There is a big difference from being mislead to being uninformed.
So you are telling me if the countrywide loan officer tells me my yearly property taxes will cost $4000 and they turn out to be $6100 that is not misleading?
While your story is a sad one, I guess I would say you need to quit blaming the bank for your mistakes.
While a good loan officer will point out what should be "affordable" for a buyer...that number varies a great deal among individuals. Is the bank supposed to know that your bonuses are not going to continue? Also a FYI-FHA loans do not have an income restriction. You could make $1mil/yr. and get a FHA loan, so not sure what happened there.
As far as the taxes, here again a good loan officer should be able to find that out, but the burden for knowledge of the yearly taxes falls on the buyer. It is a very easy number to find out unless it is new construction. Did you have a real estate agent?
I did make the mistake of buying at one of the worst times in U.S. history and ultimately it was my choice and not the banks. Shouldn't a bank we warning me of the dangers rather than talking me into this loan? This was my first home purchase and the bank basically assured me that would be ok and there was nothing to worry about. The loan I didn't qualify for was I thought an FHA first time home buyer loan that also included some down payment assistance that was forgiven after living in the home a certian amount of time. The Max income was something like $69,000 a year in Riverside County. My income was under that, but bonuses put me slightly over. I certainly would have been smart to just walk away from the whole thing when the bank came back and said I didn't qualify, but I was literally a couple days from moving into the home. I wasn't completely duped or anything, but I was certainly misled and jerked around a bit. Regardless the situation now is what it is and who is it blame really doesn't matter when I have the choice of staying in the house or eating top ramen for the next 2 years to keep a home that will probably be worth less than half of what I paid for it in another 6 months.
I think each person needs to do what is good for them -- in the end, it is your own family's life -- no one else really cares about your family, except your family -- that's just how it is. Take care of yourself, first.
I agree!!!
Quote:
For the record, I'm not leaving my home -- it's not for sale, I'm not foreclosing, I just see it happening all over. I think many of these bankers are crooks....just my opinion.
This surprised me. I assumed that you were in this situation, and wanted an opinion on how "right or wrong" it was to do it. I'm very glad you aren't. I have to say THANKS for a very informational, and sometimes entertaining thread. My hat is off to you!
My house is also just a starter home and the first home I've ever purchased. The problem for me is not my rate. The problem is the the bank understated some of the costs of the home along with many other costs rising greatly over the past 18 months with my income actually dropping a bit even though i haven't lost my job. That coupled with hardly being able to buy food with my currently level of income/payments and the fact that my house is worth close to half of what I paid for it is making it difficult to do anything with it. I guess I should call my lender before I actually get behind... maybe ask about a short sale. Actually the reason for posting here is to see what success if any that people have had dealing with this type of situation and the bank. If it matters my lender is Countrywide.
FYI - California is a non-recourse state. If you didn't refinance and all of your mortgage is purchase money, they can't go after you for a deficiency judgment. If you walk, you lose any down payment that put up front and your credit gets trashed. As a point of interest, DQ reported that SoCAL home sales were up 22%Southland home sales still ultra-low; median price slips again
The inland empire ( Foreclosure Alley) reported the biggest sales gain mainly because your house ain't worth bo-diddly squat any longer and the sharks are buying them up for Section 8 rentals which will drive the prices even lower when the neighborhood is trashed. 34% were repos and I'll bet even money, that most of rest were long time residents that had little or no mortgage remaining and decided to take a little profit rather than live in gangland. My cousin saw that very thing happen in Lancaster-Palmdale. Then he moved out here to Las Vegas Sorry - that cracks me up!
Taljk you them. They'll have you fill out a new application and make better deal for you maybe - nothing lost there. - But then it's a refi. Don't know if you can walk away scott free in that case.
Did that help you make a decision??
I did make the mistake of buying at one of the worst times in U.S. history and ultimately it was my choice and not the banks. Shouldn't a bank we warning me of the dangers rather than talking me into this loan? This was my first home purchase and the bank basically assured me that would be ok and there was nothing to worry about. The loan I didn't qualify for was I thought an FHA first time home buyer loan that also included some down payment assistance that was forgiven after living in the home a certian amount of time. The Max income was something like $69,000 a year in Riverside County. My income was under that, but bonuses put me slightly over. I certainly would have been smart to just walk away from the whole thing when the bank came back and said I didn't qualify, but I was literally a couple days from moving into the home. I wasn't completely duped or anything, but I was certainly misled and jerked around a bit. Regardless the situation now is what it is and who is it blame really doesn't matter when I have the choice of staying in the house or eating top ramen for the next 2 years to keep a home that will probably be worth less than half of what I paid for it in another 6 months.
Many of us bought at the worst time in history. I am upside down on my own home and I bought in 2003 in the almost always steady MN. Not many/no one foresaw how bad things were going to get in real estate.
But, come on... the bank "talked you into this loan"? Sure the loan officer should have known what the taxes are. I assume he used an estimate. A good loan officer will err on the high side. A good loan officer will also lay out the risks, especially for 1st time homebuyers, but you as a borrower can't rely on that. Not all loan officers are good at their jobs or care about their borrowers.
When I talk to borrowers I let them know if they don't want to do their loan with me that is fine, BUT they better find someone they know can trust. A lot of mortgage guys are like car salesmen...they will do anything for a commission.
interesting thread - obviously jumping in late but it just became an issue for me. my thoughts? - i have been a home owner for 32 years total - bought and sold repeated times/not as a speculator but as a home owner - i bought in the florida market when the prices were going up at record pace every day that i didn't make a move so finally i jumped in / the bubble must have popped the minute i closed as my house slid and slid - after putting much of my self-retirement funds into the house as a down payment, i watched everything i had saved slip away. finally, two and a half years later, having faithfully paid my mortgage, both my husband and i were unemployed due to the slump in local government revenues and other issues and thus, we found ourselves in a matter of months, plummeting from a healthy income to nothing. all local govts in the area were downsizing so re-employment was not an option - not a lot of executive positions and thus one becomes over-qualified for any other job or really not qualified for the jobs that are out there - the option became to continue to feed the house payment and take the chance that it would stop declining in value and actually be able to be sold - when i realized that the house was worth less than the mortgage, with all of my equity gone and houses not moving in the neighborhood, i walked. it became a point of cutting one's losses and getting on with one's life. yes, the bank suffers but did i hear them offer to apply the payments in interest that i made for over 2 1/2 years toward the principle that i owed? ( a mere 55000 plus) did i hear them offer to revert to an interest-free loan for the remainder of the mortgage, willing to accept simply a minimal principle payment until one could get on their feet? did i hear them consider they were the ones that appraised the house to be worth what i paid when i bought it/who collected administrative fees etc to write the mortgage/etc - eventually they offered me 1500.00 to defer the cost of relocating and accept a deed in lieu of foreclosure with one caveat - that i agree to accept responsibility for any deficiency in the future sale of the home. The offer would save them the cost of foreclosure and my free-loading in the house while they went through the process. I was perfectly willing to surrender the house immediately in great condition/relocate with or without their "cash"/but i cannot at my age take responsibility for whatever deficit should arise - i have to be able to live in the future as well. So, before anyone thinks it's atrocious to walk on a mortgage, recognize that many many very responsible people have gotten caught in this crashing market/downsizing of businesses and governments and are in a place that never could they have seen themselves in . and thus, never say never. life goes on............but it is a scary thing for society when the ones that played by the rules start to get steamrolled by the economy - of such are revolutions made.................
interesting thread - obviously jumping in late but it just became an issue for me. my thoughts? - i have been a home owner for 32 years total - bought and sold repeated times/not as a speculator but as a home owner - i bought in the florida market when the prices were going up at record pace every day that i didn't make a move so finally i jumped in / the bubble must have popped the minute i closed as my house slid and slid - after putting much of my self-retirement funds into the house as a down payment, i watched everything i had saved slip away. finally, two and a half years later, having faithfully paid my mortgage, both my husband and i were unemployed due to the slump in local government revenues and other issues and thus, we found ourselves in a matter of months, plummeting from a healthy income to nothing. all local govts in the area were downsizing so re-employment was not an option - not a lot of executive positions and thus one becomes over-qualified for any other job or really not qualified for the jobs that are out there - the option became to continue to feed the house payment and take the chance that it would stop declining in value and actually be able to be sold - when i realized that the house was worth less than the mortgage, with all of my equity gone and houses not moving in the neighborhood, i walked. it became a point of cutting one's losses and getting on with one's life. yes, the bank suffers but did i hear them offer to apply the payments in interest that i made for over 2 1/2 years toward the principle that i owed? ( a mere 55000 plus) did i hear them offer to revert to an interest-free loan for the remainder of the mortgage, willing to accept simply a minimal principle payment until one could get on their feet? did i hear them consider they were the ones that appraised the house to be worth what i paid when i bought it/who collected administrative fees etc to write the mortgage/etc - eventually they offered me 1500.00 to defer the cost of relocating and accept a deed in lieu of foreclosure with one caveat - that i agree to accept responsibility for any deficiency in the future sale of the home. The offer would save them the cost of foreclosure and my free-loading in the house while they went through the process. I was perfectly willing to surrender the house immediately in great condition/relocate with or without their "cash"/but i cannot at my age take responsibility for whatever deficit should arise - i have to be able to live in the future as well. So, before anyone thinks it's atrocious to walk on a mortgage, recognize that many many very responsible people have gotten caught in this crashing market/downsizing of businesses and governments and are in a place that never could they have seen themselves in . and thus, never say never. life goes on............but it is a scary thing for society when the ones that played by the rules start to get steamrolled by the economy - of such are revolutions made.................
Sorry to hear about yoru situation.
As for me..mine has gotten even more complicated.. let's just say the banks are retarded.. I now have them $28K more than the minimum that they would accept for thehome and they are refusing because of a lien on my house that I wouldn't be able to remove in time to keep the 2 buyers on the hook or even before foreclosure were to hit. And I don't have the money to make the lien go away at the moment (we're trying to rebuild our savings after having lost our shirts on our first home!). So.. because they dont' watn to satisfy a lien that is far less than the $28K more than I got them above the minimum they would ahve accepted at it's new appraised pric e($120 K less then when we got this mortgagge) they are stonewalling.
Which is retarded.. so it will go to foreclosure and they stand to loose and additional $50 - 100K (I will take my appliances and some thing sfrom the house when I leave if ti forecloses..I could usei t where I"m going). Doesn't make much sense.
I've done all I could to do the right thing by the bank as best I could. they are standing in their own way at this point.
I realized foreclosure is not the end of the world.. I will recover, life will go on. I have my beautiful son, my husband and my health and that's all that matters...
And I know where I will be living next.. as I have my rental lined up (that I someday hope to buy in say 4 years!)
As for me..mine has gotten even more complicated.. let's just say the banks are retarded.. I now have them $28K more than the minimum that they would accept for thehome and they are refusing because of a lien on my house that I wouldn't be able to remove in time to keep the 2 buyers on the hook or even before foreclosure were to hit. And I don't have the money to make the lien go away at the moment (we're trying to rebuild our savings after having lost our shirts on our first home!). So.. because they dont' watn to satisfy a lien that is far less than the $28K more than I got them above the minimum they would ahve accepted at it's new appraised pric e($120 K less then when we got this mortgagge) they are stonewalling.
Which is retarded.. so it will go to foreclosure and they stand to loose and additional $50 - 100K (I will take my appliances and some thing sfrom the house when I leave if ti forecloses..I could usei t where I"m going). Doesn't make much sense.
I've done all I could to do the right thing by the bank as best I could. they are standing in their own way at this point.
I realized foreclosure is not the end of the world.. I will recover, life will go on. I have my beautiful son, my husband and my health and that's all that matters...
And I know where I will be living next.. as I have my rental lined up (that I someday hope to buy in say 4 years!)
I have been following your posts for about 6 months now. I feel for you. Much of this country, not all of it is suffering from a deep recession never seen ever before. A few cities I would clasify as a DEpression.
All my life I heard that banks dont want to take the house in foreclosure. They do not want to be in the Real Estate business. I say hogwash. If that is true then why are these lenders preferring to foreclose rather then work with the homeowner. Does anyone realize how many people want to keep their homes? They are usually duel income families and never missed any payments in their life.
Now inject all the job losses and the interest rates jumping up. The lenders are flat out refusing to modify the loans so these people can stay in their homes. They are all playing hard ball and are losing by their bully tactics. Their only revenge is to ding the borrowers credit. This seems to be the preferred method of all the mortgage companies.
Im not for any bail outs either. But why cant your govt force these banks to modify loans rather then foreclosing? How hard is that?
You all ain't seen nothing yet. The worst is still yet to come. Where I am, 1 out of every 27 homes are in foreclosure. It doesn't have to be that way.
Shame on the banks. I have no sympathy for them. How many banks have closed their doors forever this year? 7 right? 4 more then all of last year so far. I hope they all go under.
I have been following your posts for about 6 months now. I feel for you. Much of this country, not all of it is suffering from a deep recession never seen ever before. A few cities I would clasify as a DEpression.
All my life I heard that banks dont want to take the house in foreclosure. They do not want to be in the Real Estate business. I say hogwash. If that is true then why are these lenders preferring to foreclose rather then work with the homeowner. Does anyone realize how many people want to keep their homes? They are usually duel income families and never missed any payments in their life.
Now inject all the job losses and the interest rates jumping up. The lenders are flat out refusing to modify the loans so these people can stay in their homes. They are all playing hard ball and are losing by their bully tactics. Their only revenge is to ding the borrowers credit. This seems to be the preferred method of all the mortgage companies.
Im not for any bail outs either. But why cant your govt force these banks to modify loans rather then foreclosing? How hard is that?
You all ain't seen nothing yet. The worst is still yet to come. Where I am, 1 out of every 27 homes are in foreclosure. It doesn't have to be that way.
Shame on the banks. I have no sympathy for them. How many banks have closed their doors forever this year? 7 right? 4 more then all of last year so far. I hope they all go under.
Thanks for your posts.
I'm not for a bailout either.. because I feel that it is unneccesary to use tax paying dollars to fix the problem at hand.. that the banks and the borrowers could work it out between the two. It's the banks that want the gov't to give them money for their woes! It's just nonsense and another case of corporate welfare!
If you truly break it down.. if they took the short sale, the bank isn't really loosing out. Why? Because for the first few years of a mortgage most of the payment is for interest. I payed down approx $7,000 of my principal and paid approx $36,000 a year in payments.. obviously mostly interest. So.. if they take the offer that I have on the table, they are taking about $65K less than what the principle was at the time of the default (principle is now higher with their nonsense fees and crapped tacked on.. but lets look at money given up front). So in 3 years they've collected about $90K in payments from me (of which $8000 was for taxes/insurance approx ) which leaves them $66K they have collected - $7K principal paid down is what $59K. So they are taking $67K less than the principal that the mortgage was paid (before realtor fees). In the end they are getting probalby around $50K less than the principal owed (of which they collected $59K in interest the last few years). I know that's oversimplified.. there are other costs to consider that they pay for the mortgage.. but basically their losses are NOT as significant if they took my deal..
As for me.. I've lost all the money I've paid, PLUS the money I've put into my home in renovations! Not to mention the hit to my credit.
I believe the banks have a lot of nerve expecting the taxpayers to payfor their problems. A lot of people tat have bashed me on this board also seem to forget that those being foreclosed on are also tax paying citizens.. so we are getting screwed twice by the banks.. they are taking our homes AND taking our tax paying dollars to subsidize their "losses"!!
I feel horrible for some of the choices I made and have tried hard to fix it the best I can.. but when banks make stupid decisions like they are in my case it's no wonder we're all in this mess..
Then again.. these are people that gave out $400K loans to people makin g$2500/month (of which I am not in that category.. and feel that if th subprime mess hadn't occurred I would have been just fine and refi'd now into my fixed rate).
Next home I buy, which I hope will be the one I just found to rent, I will ask the homeowner to hold the mortgage for me (they probably can) I'd rather see someone like them make money on a mortgage than anylending institution or bank (btw. I will buy the next house mostly cash that I plan on rebuilding and saving again to start over)
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and they are scoundrels. They "forgot" to put two extra land parcels of mine into escrow for my taxes -- it was in the paperwork, but they "neglected" to follow through -- until I got a letter from the Tax Assessor's office! Countrywide kind of "hahahaed" it and made light of it -- but that puts my monthly payment higher than stated (fortunately, they weren't expensive parcels)! I did find out that Bank of America bought out Countrywide, so they are going down that long country road -- "Bye, bye, Countrywide." 
never say never
