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Be smart while refinancing...Do your homework. Countrywide will gouge you!!

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    Be smart while refinancing...Do your homework. Countrywide will gouge you!!

    I just refinanced and bought out of my Ch. 13. I feel for Tin and his father's experiences. I just thought I'd put my 2 cents in about scammer mortgage companies...even supposedly reputable ones.

    After 9 years with COUNTRYWIDE, I felt pretty confident that I was safe with them. They lull you into a false sense of security and that they'll "always take care of you."

    I called them first because I figured that whoelse could serve me better, given I had been with them for so long. I spoke to Adam in the Full Spectum Lending Division. Since I had a BK now, I couldnt be served on the 'A' paper side... I had to go with the sub-prime department. He said they do Ch. 13 buyouts "all the time" and he was "familiar with all the rules and procedures."

    To make a long story short, Adam promised me the sun, moon, and stars. I heard "No problem" about 100 times. He said that since I already had my mortage with them, all I had to send in was current proof of income and my last 2 years tax returns. I faxed the items to him at 10 a.m. and he called me 2 hours later to say that I was approved and an appraiser would be at my house that afternoon.

    The appraiser came and the next day Adam called...everything is set...Lets close next week. Never mind that we needed court approval...which he didnt know...despite all of his alleged BK experience.

    He ended up sending me a GFE with $8500 in closing costs, which included $3500 in points buy-down. He said the best interest rate I could possibly get while in BK was 8.5% after buying down 3 points.

    The Trustee totally objected to the rate and the fees, saying that she wasnt denying our motion, just that we could probably get a better deal elsewhere, and to shop around.

    By happenstance, I was referred to a friend who works for a mortage broker. She was wonderful and she agreed that Countrywide was trying to take advantage of our desperation. She found 5 lenders with better rates and we picked the one that best fit my needs.

    We got a good rate 7.5% and I ended up paying only $1500 in orginination and fees. She encouraged me to give the GFE to Adam at Countrywide and see if they would match the offer. No response for several days... then finally he called and said that Countrywide could not match the deal. He told me to "go for it" because it sounded like a good deal. I did.

    The Trustee approved the refinance with the other lender and I am done with BK! Plus, I got $23K in cash out of the deal!!! I cant believe I almost fell for the "trust us" scam from Countrywide.

    #2
    WOW! Crazy to hear this, I just went through a similiar circumstance. To make a loooooonnnng story short, I tried to refinance out of my Chapter 13 BK with a lender I met on this website. Like you, I was promised the world, no problems, don't worry, etc etc. After a couple months of going back and forth with paperwork, appraisals, termite inspections, trustee approvals (which was a mess because the lender said I could refinance the house WITHOUT doing a full Chapter 13 buyout, which was wrong)...after all that, I was told I needed around $8,000 to bring to closing. WHAT??? If I had $8,000 dollars, I wouldn't be in this mess in the first place!! How was I, knee deep in a Chapter 13, supposed to come up with $8,000?????

    Then one day at home, I got one of those "you are pre-approved for a Chapter 13 refinance!" mailings that I normally just throw away without even opening. But for whatever reason, I opened it. It seemed reasonable but I was still jaded from the last experience. I gave the guy a call from the mailing....and to my surprise, it was one of the easiest transactions I've ever had. Mind you, nothing had changed about my situation from the last lender....but now, this company was able to refinance me at 7.5% and do a complete Chapter 13 buyout AND I got $10K back in my pocket!!!!!! They were wonderful to work with, understanding, patient and the DEFINITELY fought for ME and not for the underwriters.

    So I totally agree....you have to be careful and shop around. One lender tells you need $8K to close, another can do it and get you $10K back. I believe the whole key is EXEPERIENCE on the lenders part. I don't believe it was the first lenders fault....he just didn't have enough experience with Chapter 13's. The company I ended up with, knew how to work a Chapter 13 inside and out...they had contacts in the Trustee's offce, etc etc.

    It's just like anything else.....you wouldn't have someone do work on your house without getting several estimates. Same thing with a refinance.
    Date Filed: 12/19/2004
    341 Meeting: 2/8/2005
    Date Case Confirmed: 7/12/2005
    Closed on Refinance/Chapter 13 Buyout 8/23/06

    Comment


      #3
      One more tidbit of advice... Dont assume that those little mom and pop mortgage companies cant help you. Often times they are hungry for business and they go the extra mile to help you. We got great customer service and we were kept up to date every step of the way!!! Those big companies dont have anything to lose.

      Comment


        #4
        who did you go with? and what loan to value do they go upto? do they go upto 100% of the value?
        6/06 filed for bk 13
        7/06 plan confirmed

        Comment


          #5
          Lender Experience

          Originally posted by Jman30 View Post
          I believe the whole key is EXEPERIENCE on the lenders part.
          Absolutely true! I hear similar horror stories everyday. Most times, they come to me after some other lender has jeopardized thier bankruptcy protection.

          Shop around and ask plenty of questions. Doing Chapter 13 Buyouts requires alot of experience, on the lender's part, about the bankruptcy law process. Chapter 13 Buyouts are not regular mortgages.

          Alex Socia, J.D., M.A.
          Last edited by SinkingFast; 09-24-2006, 07:59 AM. Reason: Removed Advertising

          Comment


            #6
            buy out...

            Originally posted by bkdone View Post
            I just refinanced and bought out of my Ch. 13. I feel for Tin and his father's experiences. I just thought I'd put my 2 cents in about scammer mortgage companies...even supposedly reputable ones.

            After 9 years with COUNTRYWIDE, I felt pretty confident that I was safe with them. They lull you into a false sense of security and that they'll "always take care of you."

            I called them first because I figured that whoelse could serve me better, given I had been with them for so long. I spoke to Adam in the Full Spectum Lending Division. Since I had a BK now, I couldnt be served on the 'A' paper side... I had to go with the sub-prime department. He said they do Ch. 13 buyouts "all the time" and he was "familiar with all the rules and procedures."

            To make a long story short, Adam promised me the sun, moon, and stars. I heard "No problem" about 100 times. He said that since I already had my mortage with them, all I had to send in was current proof of income and my last 2 years tax returns. I faxed the items to him at 10 a.m. and he called me 2 hours later to say that I was approved and an appraiser would be at my house that afternoon.

            The appraiser came and the next day Adam called...everything is set...Lets close next week. Never mind that we needed court approval...which he didnt know...despite all of his alleged BK experience.

            He ended up sending me a GFE with $8500 in closing costs, which included $3500 in points buy-down. He said the best interest rate I could possibly get while in BK was 8.5% after buying down 3 points.

            The Trustee totally objected to the rate and the fees, saying that she wasnt denying our motion, just that we could probably get a better deal elsewhere, and to shop around.

            By happenstance, I was referred to a friend who works for a mortage broker. She was wonderful and she agreed that Countrywide was trying to take advantage of our desperation. She found 5 lenders with better rates and we picked the one that best fit my needs.

            We got a good rate 7.5% and I ended up paying only $1500 in orginination and fees. She encouraged me to give the GFE to Adam at Countrywide and see if they would match the offer. No response for several days... then finally he called and said that Countrywide could not match the deal. He told me to "go for it" because it sounded like a good deal. I did.

            The Trustee approved the refinance with the other lender and I am done with BK! Plus, I got $23K in cash out of the deal!!! I cant believe I almost fell for the "trust us" scam from Countrywide.
            this is no surprise...money rules this world and banks and credit cards have
            to be at the very top...charging you like $36 in overdraft fees...

            but anyways, maybe someone can explain to me what is buying out
            of a chapter 13? and if he refinanced, how did he walk away
            with 23k cash?

            Comment


              #7
              Originally posted by davids View Post

              but anyways, maybe someone can explain to me what is buying out
              of a chapter 13? and if he refinanced, how did he walk away
              with 23k cash?
              Instead of paying the full 60 months of payments, or whatever the Ch 13 payment plan originally was, some people here have refinance their homes and paid off their plans early. That's the buy-out.

              When you plan to do a refi/payoff, you get a preliminary figure from the Trustee's office to approach Lenders with. Sometimes, the Loan gets approved and then the Final Buy-out figure that comes from the Trustee is a much lower $$ figure. In that particular case you cited, the Filer's refi was for $23K more than the final buy-out figure.
              Filed Ch 7 - 09/06
              Discharged - 12/2006
              Officially Declared No Asset - 03/2007
              Closed - 04/2007

              I am not an attorney. My comments are based on personal experience and research. Always consult an attorney in your area to address concerns related to your particular situation.

              Another good thing about being poor is that when you are seventy your children will not have declared you legally insane in order to gain control of your estate. - Woody Allen...

              Comment


                #8
                In my case, we knew how much the Chapter 13 pay off was and we asked for an additional $20K. We had to let the Trustee know what we intended to do with the lump sum of cash...household maintenence and repair...etc... The Trustee was aware of the additional money from the beginning. It was written into our GFE.

                Comment


                  #9
                  And, I forgot to mention... obviously we had lots of equity in the house. After the refinance, I still have about $60K in equity.

                  Comment


                    #10
                    Can I buy me a house!

                    Hmmm, maybe I can find a program that will pay my chapter 13 in full and get me a house???

                    Catchmeifyoucan
                    July 2006: Filed Ch13 :blink:
                    Oct 2006: Converted to Ch7 :clapping:
                    Jan 2007: DISCHARGED :clapping:
                    Nov 2007: CLOSED :yahoo::yahoo::yahoo:

                    Comment


                      #11
                      Originally posted by SinkingFast View Post
                      Instead of paying the full 60 months of payments, or whatever the Ch 13 payment plan originally was, some people here have refinance their homes and paid off their plans early. That's the buy-out.

                      When you plan to do a refi/payoff, you get a preliminary figure from the Trustee's office to approach Lenders with. Sometimes, the Loan gets approved and then the Final Buy-out figure that comes from the Trustee is a much lower $$ figure. In that particular case you cited, the Filer's refi was for $23K more than the final buy-out figure.
                      Exactly. We got an initial "unoffical" payoff from the Trustee initially of around $24,000. So the lender based on the loan on that figure. Based on the $24,000 amount, I was only getting back like $4,500 or something. Well, once the loan was approved, the OFFICIAL Chapter 13 payoff came in at $19,800. So I was able to walk away with an additional $4,200 plus the original $4,500. We didn't have to tell the Trustee what we were doing with the money.....the Trustee just had to final sign-off on everything.
                      Date Filed: 12/19/2004
                      341 Meeting: 2/8/2005
                      Date Case Confirmed: 7/12/2005
                      Closed on Refinance/Chapter 13 Buyout 8/23/06

                      Comment


                        #12
                        Originally posted by bkdone View Post
                        One more tidbit of advice... Dont assume that those little mom and pop mortgage companies cant help you. Often times they are hungry for business and they go the extra mile to help you. We got great customer service and we were kept up to date every step of the way!!! Those big companies dont have anything to lose.
                        So true.... I assumed that only a big company would touch us so we went with a big broker in our state that works with Option One. They wanted $18,000 in *broker fees* in addition to another $8,000 in other buy down points and closing costs. Thank god our attorney talked us out of it. We tried a small broker in town that we found in the yellow pages and ended up just paying $6000 in broker fees, points, and closing costs. All at the same rate and terms. Beware!

                        Comment

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