Too late for applying for loan mod or hamp or ?

[CCsAreEvil]

So, received auction sale date for the 1st week of April (NOD filed beginning of Jan). Would it be too late in the game to start some sort of loan mod app? I have various people saying I should try the make home affordable program. Let me run some numbers.

owed on 1st: ~$250k (now probably $260-270k with all the back payments and fees)
owed on HELOC: ~$100k

house supposed value around $200-230k?

household income: $80k

1st is already a 30 year fixed at 5%.

I've read some people say once you have an auction date, it's too late. Just getting some thoughts on this. My guess is there would probably be little to no change in a monthly payment. Maybe they tack on all the late fees and past months at the end of the new loan mod?

Before I ramble more, any thoughts?

[helpme2010]

You are not too late. I received a trustee sale date that was 2 weeks away and when I called the mortgage company said I was too late. But you may still have enough time. Call your mortgage company and tell them you want to do a loan mod. They will send you the loan mod packet, probably within a week or so. Fill it out and send it in right away. It will take them a month or two to review it, so you may run out of time, possibly not. There is no guarantee they will give it to you, but you have nothing to lose by trying. They might even put your foreclosure on hold and delay the sale date while they are reviewing your loan mod doc.

[BKParalegal]

The question is why? You are no less than $100k upside down on that house and it would take years to break even if ever. Now start a loan mod to stay on the house longer but let that puppy go, and buy another house 2 or so years from now that makes sense.

Good luck

[helpme2010]

The question is why? You are no less than $100k upside down on that house and it would take years to break even if ever. Now start a loan mod to stay on the house longer but let that puppy go, and buy another house 2 or so years from now that makes sense.

Good luck

That is my plan, to stay in my house longer. Another 6 months would be helpful as I am out of work and it will be difficult to rent another place post-bk and being unemployed. So I am hoping for another 6 month forbearance plan.

I agree with letting the house go and some day buying another house. I do not plan on buying another house for another decade or so. I want to make sure I have a lot of money saved up and a very stable career (so far this is not the case).

[Pandora]

owed on 1st: ~$250k (now probably $260-270k with all the back payments and fees)
owed on HELOC: ~$100k

house supposed value around $200-230k?

household income: $80k

1st is already a 30 year fixed at 5%.

You're not over 100K upside down by your numbers listed - you're roughly $20-30K upside down - unless your 2nd was purchase money (80/20). Otherwise, it doesnt really count - 1st mortgage price counts so..what did you purchase the house for? That will tell you how much you're upside down.

Loan mods are typically done if your mortgage payment exceeds 31% of your income; so is your mortgage payment below $2066 a month?

You're already locked in at 5% - I seriously doubt that a mod will help lower your payment any lower than it currently is. Since we're talking hypothetically here, lets go with how it would work for HAMP:

- all arrears / late fee's would be recalculated, tacked on the end of the note

- waterfall the rate beginning 2% years 1-5 (plus any PMI you may have is yours to pay & cannot be incl. in the reduction)

- increase to 3% year 3; 4% year 4 and then years 5 onward are at current market rate; as of today that is approx. 5.1%

- to get you to the 2% beginning rate, they'd have to ensure it wasnt more profitable for them to foreclose vs. modifying. This in turn, could possibly create a balloon payment, payable at XX year or at the end of the note.. in full. Of course, it would be 0% interest the life of the note, however.... creates a huge lump sum payment.

- extend the note out to 40 years if needed in order to get you to the 31% threshold


So - is it worth it for you to get a temporary reduction in your interest rate for a few years in exchange for possibly creating more time to the end of the note, a balloon payment, arrears, and a higher rate than what you're paying currently? Remember, the rate doesnt lock in until you get a perm. mod offer - so if interest rates increase over today's rate.... you'll be higher in the long run.

[helpme2010]

This is why I ask if the purpose is just to buy some more time in the house at a lower monthly payment or to stay permanently in the home. My goal is some extra time. CC's??? Perhaps just a few more years in the house???

[CCsAreEvil]

Sorry for the delayed reply. Yeah, it's more of buying more time. Maybe a few months and maybe another year or 2. Long term, it makes no sense at all. However, if I'm able to get a decent enough "mod" so the payments are tolerable (reduced enough) for the short term, I'd do it and make the payments until we again are at a point to just leave.

I'm more on the side of just leaving in April. My wife wants to stay a bit more. However, there's always that unknown of not knowing where we will be at... but we will start looking for a place in March just in case.

[helpme2010]

Sorry for the delayed reply. Yeah, it's more of buying more time. Maybe a few months and maybe another year or 2. Long term, it makes no sense at all. However, if I'm able to get a decent enough "mod" so the payments are tolerable (reduced enough) for the short term, I'd do it and make the payments until we again are at a point to just leave.

I'm more on the side of just leaving in April. My wife wants to stay a bit more. However, there's always that unknown of not knowing where we will be at... but we will start looking for a place in March just in case.

Sounds like we are in the same boat. I filed a 13 to stop the auction date and give me a chance to work out something with my mortgage company. I recently mailed the loan mod docs and I will check in soon to see if they have them. I am like you, just trying to buy more time to stay in the house. I am hoping they give me a forbearance plan at a reduced payment amount.

[ryan]

Just a comment: If your goal is more time, applying for a Mod MAY help. ...or it might not change the timetable. Some lenders will suspend the FC action, others will not. Overall, it can't hurt, other than the time to fill out forms. But I will say it can be effective to go before the judge and imply you are very close to getting a modification approved. At some point though, if it doesn't come through, then the sale will proceed.

[helpme2010]

I am hoping to work a mod with the bank directly. They did 2 forbearance plans with me before bk. I'm not very hopeful, but its worth a shot. The main thing is I just need to find a job so I will be more credit worth when looking for a new place to live. You never know what a few extra months will do for a job hunt. I am open to a some type of forbearance plan, renting with the mortgage company, whatever.