Modification question

[ssmdem]

The other half of the 31% question is whether that payment can actually service the loan.

If you have $400,000, with PITI, that payment is probably pushing $3000 per month. However, if 31% of your gross income is now only $1,400, that is simply not enough to service that loan even at 30 years at 1%. So, there would be no way to modify.

I agree - which is exactly why I have said all along that I don't know that it's even worth the effort to try as I don't know that it's going to help. And again, exactly why I don't want to go the HAMP route. The trial payments are my issue -- I refuse to throw anymore money at this loan if we're probably going to lose the house anyway.

I've run the numbers and percentages already -- actually used to be a loan officer myself in a former life -- it's HIGHLY questionable whether they're going to be able to pull this off.

Don't mind giving it a shot -- but not willing to fork out trial payments for months to have them say no or adjust the payment to something even higher to bring the loan current. If they'll do an in-house so I know what we're looking it, I can discuss it -- but since I know the chances are slim.......just would rather let them take it and be done with it.

My husband actually talked to the DOL department yesterday. Of course they suggested short sale, which I'm just not dealing with -- houses aren't selling around here anyway - AT ALL -- consequently the reason for the excessive amount of rentals available. They didn't sound completely negative and were actually pretty nice. Suggested going the modification route first just to see what they could offer before throwing in the towel. But said they were certainly willing to discuss it with us if that's the route we decided we wanted to go.

[Pandora]

The other half of the 31% question is whether that payment can actually service the loan.

If you have $400,000, with PITI, that payment is probably pushing $3000 per month. However, if 31% of your gross income is now only $1,400, that is simply not enough to service that loan even at 30 years at 1%. So, there would be no way to modify.

This is true - which means foreclosure is the banks benefit as it wouldnt justify a modification as even with all the stops, bells and whistles, there is no way to modify to get it down low enough. ETA: We were lucky enough to be able to get everything done and not have a huge balloon (under 15K) when our note becomes due at year 40, so it was in the banks interest to modify and not foreclose - and we can afford the mortgage the entire life of the loan.

Thanks for pointing that out HHM ;)

[HHM]

The other half of the 31% question is whether that payment can actually service the loan.

If you have $400,000, with PITI, that payment is probably pushing $3000 per month. However, if 31% of your gross income is now only $1,400, that is simply not enough to service that loan even at 30 years at 1%. So, there would be no way to modify.

[ssmdem]

I agree - send everything in and see how it goes - no harm in trying. For the record, our mortgage was cut 50%, so what you think is "impossible" may not be . Are you trying to keep your house or are you just trying to buy time here? I think that would be the deciding factor of applying in the end.

do the math and see what you come up with - what is 31% of your gross earnings? That should include everything (PITI) except any PMI you may have that is required - that will be in addition to the 31% guideline. Most in-house mods usually mimic HAMP guidelines, but are faster to get approval for with no trial payments.

See that's what I was hoping for though. I don't want to do the trial payments - I want an in-house modification, which is what they originally said they were doing --- but now they're saying they have to see if we qualify for HAMP first. I don't want to throw away money on the trial payments if the new terms aren't something I can't live with. I've done the math - 31% will be half - actually possibly a little more than half of what our payments are now, more like a 60% cut.

And I know that when we file for bankruptcy - that's going to throw our application out and we'll have to start over again. If we've started trial payments at that point, that's money out the window. Just frustrated that they didn't do what they said they would do.

[Pandora]

I agree - send everything in and see how it goes - no harm in trying. For the record, our mortgage was cut 50%, so what you think is "impossible" may not be . Are you trying to keep your house or are you just trying to buy time here? I think that would be the deciding factor of applying in the end.

do the math and see what you come up with - what is 31% of your gross earnings? That should include everything (PITI) except any PMI you may have that is required - that will be in addition to the 31% guideline. Most in-house mods usually mimic HAMP guidelines, but are faster to get approval for with no trial payments.

[HHM]

Good luck. No harm in sending it.

[ssmdem]

And now they're telling me the copy of the extension is all they need. They don't want 2008 -- just the extension. We'll see......

[ssmdem]

You will need 2009, they will probably kick it back if you have only filed an extension. 2008 is too old.

Well, okey dokey then -- guess I'm not bothering. Really not wanting to anyway - can you tell? I just know it's a waste of time and energy. Even my attorney told me it wouldn't hurt to try to be able to say I made an effort, but not to put alot of hope into it. Gonna be kinda hard to get a $2800 payment down to $1400 or $1500.

Guess I'd be better off spending that time getting tax returns finished up.

[HHM]

You will need 2009, they will probably kick it back if you have only filed an extension. 2008 is too old.

[ssmdem]

Alrighty, one more question -- UGH!! copy of current tax return -- umm, haven't filed - did an extension. ?????? Do I send 2008 and a copy of 2009 extension?

And they want copies of the cancelled checks from the rental payments we get from the tenant. Uh, cancelled checks go back to her - not me. Guess I can give them copies of the deposit slips. Was thinking my bank might have them online - but they just photocopy the deposit slip, not the items that were included in the deposit.

[SMinGA]

For me, it was current income. Had to send in recent paystubs. When I sent in my final paperwork (signed & notarized) had to send in the most recent stubs as well. I really don't think what you used to make will be relevant, especially if you know you're no longer going to see that $ on a regular basis.

[ssmdem]

They were already actively working on the inhouse mod - I got the paperwork for it a few weeks later. Different lender, different mortgage to income ratio may be pertinent, I don't know. Nothing else was ever said/done about the HAMP paperwork though.

If the mod is primarily a time-delay tactic for you, perhaps its not important which one they work on? I think there would still be time between starting the process & when they expect a trial payment. One theory would be send the paperwork back at the last possible moment.

Yeh, it is mostly a time-delay tactic unless the payment does actually get down low enough to afford it - then I'll just essentially think of it as rent and walk later.

Got another question -- for income -- my sub teaching money. Obviously not making any now. Really won't be doing much subbing in the fall either - if any. Got my last check last early last month. Do I include that as income for this purpose -- they just want monthly income - don't specify a time frame though.

[SMinGA]

They were already actively working on the inhouse mod - I got the paperwork for it a few weeks later. Different lender, different mortgage to income ratio may be pertinent, I don't know. Nothing else was ever said/done about the HAMP paperwork though.

If the mod is primarily a time-delay tactic for you, perhaps its not important which one they work on? I think there would still be time between starting the process & when they expect a trial payment. One theory would be send the paperwork back at the last possible moment.

[ssmdem]

Well, they told him that they have to do this first to see if we qualify. ?????? I know we'll qualify. Our current payment is almost 60% of our current income. But, again, he point blank told them that we were filing for bankruptcy and there was no point in making trial payments if we were still going to be in the approval process when we filed, and then that would make them throw it out and force us to start over. I love their "you have many options right now" line -- really, cause you don't seem to be giving us any.

[ssmdem]

My husband is getting on the phone with them now. So, did you just ask them to send out different paperwork? No point in filling this out if we're not going that route. We WOULD qualify for HAMP -- but I don't want to do the trial payments and then them not come up with a solution at the end that I'm okay with.