New here, and need help

[JohnnyO]

Hi All, looks like lots of good info here. I'll try to keep it simple. I filed a chap.7 earlier in the year, and it has been discharged. I kept my house and one vehicle that Im making payments on. Now that I think about it, I should have let the truck go, but too late now. Anyway, Im behind about 7 months on the mortgage, it's with CitiMortgage (yuckkk) The only thing they are offering me is a loan modification, which is a joke....My normal payment is 863.00/mnth. Im paying a really high interest rate due to a divorce, it's at 11.07%. The good thing is that I only have 4 years left on a 15 year note. I pay the taxes and ins. on my own, no escrow. The new terms would be at a very low interest (he couldnt tell me how low??), but they would have to escrow the taxes. (OK with me) But the new payment would be 842.00/month, 170.00 of which would be taxes. But here's the catch.....a 96 month term!! I asked him why in the world I would go for 8 years when I only have 4 left, and all he could tell me is that this program is for helping people like me in bad situations...in other words, take it or leave it. There is no way Im going for this, I just got all the papers, but will not sign it. No forclosure yet, but Im sure it's not far down the road. So, should I go for a chap.13? Also, Im told I can do this thru a paralegal, and not have to pay the 3600.00 I was quoted for a chap.13 at my lawyers. How long should I wait? I bought some time with this modification, first payment isnt due till mid Jan, so that puts it off a bit more. And shall I consider the truck in the chap 13, if I even can? The payments are 427/mnth, and I could use that now. I can buy a beater if I need to. Sorry so long, but I just need to know what you folks have been thru, and what worked for you. Thanks, John

[Flamingo]

You really have to figure out whether or not you can afford your home. You can file Chapter 13 after your 7 but you will not not receive a discharge in the Chapter 13. You could use the chapter 13 to catch up on mortgage arrears and save your house, but it won't discharge any debt obligation. You ultimately will have to decide whether or not what is in your best interests as to taking the modification or not taking it - the modification is just spreading out your mortgage to a longer term, along with the missed payments, to make it easier for you to afford the payment. That's what most modifications do. You have to evaluate your financial position to see if you can make up the missed payments on your own and not file Chapter 13 or take the modification. Without the modification and lower payment, can you truly afford to keep your home? Your chapter 7 discharged your prevoius debt but it does not help as to any cash flow problems or employment/income problems.

[JohnnyO]

Thanks for the reply. I can afford the current payments if these jerks would let me get current by putting the late payments at the end of the mortgage. I know people who have done that. They know that I dont have a chance in he** of anyone else helping me, that's what upsets me. And I made a mistake in my OP....they want 842/mnth, not including the escrow....the total is just over 1000/mnth. How is that helping? I owe about 34,000 on the house right now. After 8 years at the rate they want, I will be paying back over 40K more than that. That's robbery, plain and simple. I would rather deal with a loan shark. I would be having no problems with my house payment and everything else since the chap.7. I work several jobs to make ends meet, and things are going pretty well with this one exception. I dont want to file another BK, but if they leave me no choice, I guess that's my only option. Im no financial expert, but anyone with half a brain can see Im getting screwed over big time. I had my lawyer run just some basic numbers, and he said that at a 4% interest rate, my payments on the current balance, even adding the past due amount, should be somewhere around 450.00/mnth. I have to do a lot more research, I can see that.

[AngelinaCatHub]

OK, $450 compared to $863, is this correct? Did you reaffirm your truck and house?

OK, you have to live somewhere. That is cheap rent. If they start you out now anew, and this covers insurance and taxes too??? Then, go for it.

Here is why, (in my opinion) if the rate is lower, when you get into a better situation, make double or payments and a half. Unless they write some bad language in the agreement, you can still pay off the place in half of the eight years, if you go for it. At this time, a 13 is max at five years. You owe four years and back payments. What good will it do for you? Take the offer or walk away from your house. (if not reaffirmed) and if reaffirmed you will be sued. 'Hub

[JohnnyO]

No Angelina, the old payment was 863.65, the new one they want is 842.00, plus another 170.00 for taxes. Total is 1012.00, and for 96 months. I did not reaffirm the house, but I did the truck. Unless Im missing something, this cannot be any sort of a good deal. Believe me, if the payment they wanted was 450, I would have sent them a check by now. Thanks for the input.

[klandsb]

Have you look into that HAMP program ???

[JohnnyO]

No I haven't, but I will look into it now. Thanks

[JohnnyO]

OK, I looked up the HAMP program, that's the program I apparently qualified under. I am going to take the paperwork to my lawyer and see what he has to say. Something still doesnt sound right to me, and when I get a feeling like this, it's always been for a good reason. Think about it for a minute.....Im paying 863/mnth now at a whopping 11%....if they lower that to 2% on this program, the payment, even if they leave the term at the 4 years that I owe, should be a whole lot less of a payment. When you spread it out over 8 years instead of 4, it should be even lower. Add the escrow on to that, and it should still be wayyyy less than what Im quoted. Who is getting all this extra money if I agree to it? The government? The bank? They both get enough already. I'm going back to the research.

[AngelinaCatHub]

No Angelina, the old payment was 863.65, the new one they want is 842.00, plus another 170.00 for taxes. Total is 1012.00, and for 96 months. I did not reaffirm the house, but I did the truck. Unless Im missing something, this cannot be any sort of a good deal. Believe me, if the payment they wanted was 450, I would have sent them a check by now. Thanks for the input.

Sorry I misunderstood. Reading too many posts does that to ya.

You know, I would think they would not want you to surrender the house and they get stuck with another house on their hands. My theory has always been, "half of something, is better than all of nothing".

It seems they are not in real estate but money loaning. Why would they chance you walking.

BTW if you did not reaffirm, you can walk away from the house without them being able to sue you for a deficiency. You could cause them to foreclose, live there for free for a term and let them have the house. I know you have a large interest in the place, but I think you are still holding the trump card. You might go and talk to a real person not on a phone and explain that you are prepared to abandon it if they cannot make an arrangement you can afford. Just my opinion. 'Hub

[StartingOver08]

JohnnyO, do you have equity in this house? From your post it sounds like it.

If you have equity, the lender/servicer becomes very unreasonable in their terms. Contrary to popular belief, the servicer makes a LOT of money by foreclosing on a home that has equity. They have to return the equity to the owner after the sale, BUT they only have to return what's left over after they have taken out their massive fees. The servicer puts all kinds of fees onto the loan when it is in default. Who is your servicer?

[JohnnyO]

Thanks guys. Yes, I do have some equity in the house, maybe 35K or so. I dont want to let it go, I bought it in '73 and built it up pretty much from a shell. It's only sentimental, but you know how that goes. I lost my other home (my mom's where I grew up) in a divorce. So this is my only 'real' home. I want to keep it. I have an appt. with a lawyer tomorrow at 2:00, he did my chap.7 and said if I needed help in getting CitiMortgage to work with me, he would help. So we'll see how it goes. I'll keep you posted.

[StartingOver08]

One of the other posters on here was able to get a good modification from CitiMortgage - I think her name was Relief. In her posts she has the contact information (email and phone and name) for the upper management. That may help you with your renegotiations. I will look to see if I can find her post and that info.

[JohnnyO]

Thank you, that would be helpful.

Edit...I think I found her, and sent her a PM. I hope it went thru OK.

[JohnnyO]

Went to see my lawyer today with my paperwork. He said there is surely something wrong, don't sign anything. I told him before you write a letter or make any calls, let me try once more. I called Citimortgage, the guy who I'm working with is on vaca till next week. The guy I spoke with pulled up my info and said "Oh, I see the problem already. They based your numbers on your original mortgage of 80K, and not the 36K that you actually owe" Can you believe that? What the hell is their job supposed to be? What if I was completely in a fog and decided "Well, it's Citi, and they must know what they're doing, so I might as well sign it" It's hard for me to believe that I have to look over everyone's shoulder and make sure they're doing the job they're being paid to do. Like I have time for that. What a sad society, things are really taking a dive. Anyhow, they are re-writing my mod, and I hope to have this straightened out in a month or two.

[StartingOver08]

Good. As to looking over their shoulder - think of it this way: they are getting paid to NOT workout a modification for you. So in order to get one you have to fight like h*ll to get it. The servicer is not on your side and they are the sole contact with the lender so you have no idea what they are actually presenting to the lender! The servicer gets paid more if they do not modify your loan. You are the only one that benefits and the servicers do what they can to stand in your way to actually getting that benefit. I'm glad you spoke with someone else though so he could see that error. Stay on top of them and hopefully you will be rewarded with a good mod.