How to approach lender to renegotiate loan

Guest 0.10 Dollars($)

Hi All!

This is my first post. My situation is pretty dire. A couple years ago I re-financed my house with an exploding ARM. Anyway, about a year ago the payments started shooting up. Way up.

Meanwhile, my house value which had always been rising up to this point suddenly stopped and even took a step backwards. Here's my situation now:

1st Mortgage:
Amount: 189,000
Payments 1880 / month (was 1100 / month a year ago)

2nd Mortgage:
Amount: 42,000
Payments: 372 / month

Total:
Amount: 231,000
Payments 2252 / month

Home Value: 225,000

So I have NEGATIVE 6,000 in equity and a monthly payment that's about $600 more than we can afford.

We now have about 22,000 in CC debt and have about 8,000 left in credit before we go condition critical.

What's worse, our ARM is due to adjust again soon and will likely jump another $150 + / month.

Meanwhile, I notice I could RENT a comparable home in my area for a 'mere' $1200 a month. If I could just get rid of my house and mortgage and move into a rental, at least I could make the monthly payments and possibly over time get back into a situation where ownership makes sense again.

Now I understand all the advantages of owning vs renting. But right now, I'm not interested in long term investment strategy. I'm interested in me and my wife and kids having a roof over our head a year from now.

Plus most of the advantages of owning other than tax deduction make the assumption that you are building equity over time which we are not.

I sure as hell don't want to foreclose but I also can't get anyone to re-finance and if I do nothing but what I'm doing, I'll end up foreclosing whether I want to or not.

Now, I've heard that its POSSIBLE to contact your lender and work out some sort of deal. Either lowering you rate or even selling them your house as an alternative to foreclosure since that costs them money as well.

I'm not sure if I should do this or even how to do this. Who to call, what to say, what NOT to say, etc.

About the only thing I have going for me is that I haven't been 30 days late on a payment yet.

Any advice would be greatly appreciated!

banker0679 · Posted: Tue Jan 08, 2008 1:46 pm Post subject:

well....working with your current lender maybe your only choice.

where do you get your home value from? I hope it's not from your current lender. They normally 'devalue' your home...and so do most local banks.
Even after showing better comps...and a lot more comps to the home...my bank still declined the loan.

Try zillow..and look at the homes that were sold only in your area.
See how it compares to your home.

If you speak to your current lender....and they see that you haven't made a late payment....they will most likely not do anything. The reason is that they see that you can pay it...and why try to fix something that's not broke?

Guest 0.10 Dollars($)

banker0679 thanks for the info.

Yeah, I checked zillow. Pretty cool site. Its hard to get a handle on comps. Some houses going in the 270's and some as low as 198,000 so I'm not sure where I fit in.

I guess I'm a little confused about what you said about my lender not negotiating unless I miss payments. I thought it was important to talk to them as early as possible. Are you saying I should purposely miss a couple payments and THEN talk to them?

Seems like they should give you some cred for coming to them before you are in crisis mode but it sounds like the opposite is true.

banker0679 · Posted: Tue Jan 08, 2008 3:09 pm Post subject:

well do you think a bank is willing to give 'their' customer a lower rate then they already have? This means they will lose money.

If you were a new customer then roll out the red carpet...but since you're already in the door...different story.

I dont recommend being late...but I recommend to shop around!
Find a local lender....or a broker. Have them send out an appraiser to see how much your home is worth. If it's worth a lot then you can refinance and get a better product/rate. Always get a 2nd opinion.

When I worked at a bank they always killed my appraisals....my borrowers would go to some local lender or broker who would always be able to do their loans.

michelle · Posted: Tue Jan 08, 2008 8:00 pm Post subject:

Welcome SinkingShip,

I am sorry to hear that you are having such a difficult time right now but am glad to see that you are trying to be proactive.

Some lenders will work with you before you become late and others will not (or can not). Many times the company you make payments to is only the servicing company. They often have to take your request to the actual investor board.

You would want to try to call the loss mitigation dept. at your lender. There is a financial form that you will need to complete that shows all your monthly expenses and your income. If you have online access to your loan, you may be able to print the form from there or even complete it online and send it to them right on the website.

Generally giving the house back to the lender is one of the last resorts. Try the above first and see if you can get them to agree to working with you. If they do not agree, then they will probably ask you to try for a short sale - selling for less than the amounts due on your mortgages. If that doesn't work, then they might consider a deed-in-lieu (giving the house back to the lender).

If you are able to keep up the payments, please continue to do so. I don't think you will find many people (or any for that matter) that would recommend you stop paying. Working with your current lender will be taxing and often time consuming but it may pay-off.

Also, as banker suggested, contacting another mortgage professional to see what can be done may help. Without getting an appraisal completed, no one can truly tell you if you can or can not refinance - much of the solution will truly depend on your homes current value.

Good luck and let us know if we can answer further questions.

ckalvesmaki · Posted: Wed Jan 09, 2008 6:08 pm Post subject:

I'm going to disagree with what some of the other posters have said......There are some options.......FHA secure being one of them....FHA secure will allow you to refi the first.....and subordinate the second even if the CLTV(combined loan to value) is over 100% it does take approval by the second lien holder however. Having said that......Who is your lender? Most lenders like Chase and countrywide have ARM teams in place to help consumers with loan modification. Here is a list of lenders and there loss mitigation depts.......not gonna garuantee they are all accurate but it is a starting place....

Lender/Servicer Loss Mitigation Phone Numbers & Contact Information created by Moe Bedard of Corona, CA, reposted here at CB.com.

ABM-AMRO Mortgage (800) 783-8900
Web: "https://www.mortgage.com/C3/application.bus"

Accredited Home Lenders(877) 683-4466

AMC Mortgage Services (Also handles loans originated by Ameriquest and Argent) (800) 211-6926
1600 McConnor Parkway
Schaumburg, IL 60173
Web: "https://www.myamcloan.com/malwebapp/begin.do"

American Home Mortgage Corp.(877) 304-3100*

Ameriquest Mortgage (Debt collection -- see AMC Mortgage Services) (800) 211-6926

Aurora Loan Services (Debt collection) (800) 550-0508
By Overnight Mail:
601 5th Avenue
Scottsbluff, NE 69361
Attn: Customer Service
By Regular Mail:
P.O. Box 1706
Scottsbluff, NE 69363
E-mail: "ccnmail@alservices.com"
Web: "https://www.alservices.com/Consumer/UI/SSL/...UI%2fSSL%2fServ icing%2fDefault.aspx"

Avelo Mortgage LLC (866) 992-8356*

Bank of America(800) 846-2222

BB&T Mortgage (800) 827-3722*

AmTrust Bank (fka Ohio Savings Bank) (888) 696-4444

Beneficial (800) 333-5848

Central Pacific Bank (800) 342-8422*

Charter One (800) 234-6002

Chase (800) 446-8939
Chase Home Finance (800) 848-9136 (customer service) (858) 605-2181 (delinquency customer service)
Chase Home Finance-New Jersey(800) 446-8939*Chevy Chase Bank(800) 933-9100*
Web: "https://chaseonline.chase.com/chaseonline/l...mp;LOB=COLLogon"

Chase Manhattan Mortgage
(800) 446-8939 (Ohio Servicing Center)
(800) 526-0072 (Florida Servicing Center)
(800) 527-3040 x533 (Florida Servicing Center)

Chevy Chase Bank (800) 933-9100
Web: "https://www.chevychasebank.com/htm/payment.html" (Payment Addresses)

Citi Financial Mortgage (800) 753-3673

Citimortgage (800) 283-7918

Countrywide (800) 262-4218 or (877) 744-7691
"https://customers.countrywide.com/se...t_login254.asp"

Ditech (800) 852-0656 (800) 449-8582

Downey Financial Corp.(800) 824-6902, ext. 6696

Deutsche Bank National Call Number on Mortgage Statement

EMC 800-723-3004
P.O. Box 141358
Irving, TX 75014-1358
Web: "https://www.emcmortgageservicing.com/ccn/ccnsecurity.asp"

EverBank (800) 669-7724 ext. 4730

Equity One (Debt collection) (866) 361-3460

First Horizon Home Loans (800) 489-2966*

Fifth Third Bank (800) 375-1745 Option 3

First Merit Bank (888) 728-9931

Flagstar Bank (800) 968-7700, ext. 9780

Fremont Investment & Loan (866) 484-0291

GMAC Mortgage (800) 850-4622

GreenPoint Mortgage Funding (800) 784-5566, ext. 5383*

Green Tree (877) 816-9125

Homecomings Financial (800) 850-4622*

HomeEq Mortgage Servicing ( Debt collection) (866) 822-1471

Household Finance (A HSBC Co.) (800) 333-5848

Household Mortgage (800) 333-4489

HSBC Mortgage (800) 338-6441
Default Resolution Team (if long term problem)
2929 Walden Avenue
Depew, NY 14043
(888) 648-3124 Loss Mit
(732) 352-7519 Fax
"Web:http://us.hsbc.com/personal/mortgage/existing/difficulties.asp"

Huntington National Bank (800) 323-4695

Indymac Bank (877) 736-5556
C/O Loan Resolution Department
P.O Box 7014
Pasadena, CA 91107
(Monday - Friday 6:15am-7:15pm. (Pacific Time))
Web: "https://www.indymacbank.com/contactus/loanResolution.asp"

Irwin Mortgage (888) 218-1988
P.O Box 7014
Pasadena, CA 91107
Web: "https://www.irwinmortgage.com/wps/portal/&#...3sdAvyHZUBAAqwx 9c"
E-mail: "deliquency.prevention@irwinmortgage.com"

James B. Nutter & Company (800) 315-7334

Key Bank (800) 422-2442

LaSalle National Bank (800) 783-8900

Litton Loan Servicing (800) 999-8501 or (800) 548-8665
Fax (713) 966-8820
4828 Loop Central Drive
Houston, Texas 77081-2226
Web: "https://www.littonloan.com/index.asp"

Loss Mitigation Department Hours:
Monday Eastern: 9 a.m. - 7 p.m. Central:8 a.m. - 6 p.m. Mountain:7 a.m. - 5 p.m. Pacific:6 a.m. - 4 p.m.
Tuesday-Thursday Eastern:9 a.m. - 9 p.m. Central:8 a.m. - 8 p.m. Mountain:7 a.m. - 7 p.m. Pacific:6 a.m. - 6 p.m.
Friday Eastern:10 a.m. - 6 p.m. Central:9 a.m. - 5 p.m. Mountain:8 a.m. - 4 p.m. Pacific:7 a.m. - 3 p.m.
Default Counseling Department representatives are also available most weekends on Saturday from 8 a.m. to 12 p.m. and Sunday from 10 a.m. to 2 p.m. (CST).

Midland Mortgage (800) 552-3000 or (800) 654-4566
Web: "https://www.mymidlandmortgage.com/MyMortgage/Login/Login.asp"

Mortgage Lenders Network (800) 691-0129
E-mail: "customerservice@mlnusa.com"
Web: "http://www.mlnusa.com/customers/info_credithelp.asp"

Mortgage Electronic Registration Systems (888) 679-6377

National City (800) 367-9305, Ext. 53221 or (800) 523-8654
Attention: Homeowner's Assistance
3232 Newmark Dr.
Miamisburg, Ohio 45342
(8AM-10:30PM ET, Monday - Thursday)
(8AM-5PM ET, Friday)
(8AM-Noon, Saturday)
Web: "http://www.nationalcitymortgage.com/service_assistance.asp"

Nationwide Advantage Mortgage Company (800) 356-3442, ext. 6002*

NationStar Mortgage (888) 850-9398* Press 0 for operator

New Century Financial Now Carrington Mortgage Services (800) 790-9502 or (877) 206-9904
(6:00 a.m. to 7:00 p.m. Pacific Time, Monday - Thursday)
(6:00 a.m. to 6:00 p.m. Pacific Time, Friday)
Web: "https://myloan.newcentury.com/webapps/servi...yloans/index.do"

NovaStar Mortgage Loan Resolution Department (888) 743-0774 Non-English: (888) 743-0774, ext. 4523

Ocwen Federal Bank (800) 746-2936 or (877) 596-8560
Web: "http://www.ocwencustomers.com/csc_fa.cfm"

Attention: Financial Information
12650 Ingenuity Drive
Orlando, Florida 32826
or
Ocwen Financial Corporation
1661 Worthington Rd., Suite 100
West Palm Beach, Florida 33409
Phone: 877-226-2936

For serving Ocwen with legal process, please send to their registered agent:
Corporation Service Company
2711 Centerville Road, Suite 400
Wilmington, DE 19808
Phone: 561-682-8000, x8386

Option One (866) 711-1962 or (888) 275-2648
Web: "http://www.oomc.com/servicing/servicing_baifaqs.asp"

PHH Mortgage (Formerly Cendant) (800) 257-0460
For borrowers facing possible delinquency: (800) 330-0423*
For borrowers in the foreclosure process: (800) 750-2518

ResMae Mortgage Corp.(877) 473-7623, ext. 5944

Saxon (800) 665-7367

Select Portfolio Servicing (888) 818-6032
Fax: (801) 293-3936
Loan Resolution Department
P.O. Box 65250
Salt Lake City, UT 84165-0250
(Monday - Thursday 10:00 a.m. - 10:00 p.m. EST)
(Friday 10:00 a.m. - 7:00 p.m. EST)
(Saturday 9:00 a.m. - 1:00 p.m. EST)
Web: "http://www.spservicing.com/services/custom...nresolution.htm"

SkyBank (800) 290-3359

Sun Trust Mortgage (800) 634-7928
PO Box 26149
Richmond, VA 23260-6149
Mail Code RVW 3003Web: "https://www.suntrustmortgage.com/generalquestions.asp#"

Third Federal Savings (888) 844-7333

US Bank (800) 365-7900

Wachovia Bank of Delaware (866) 642-8608

Washington Mutual (866) 926-8937 or (888) 453-3102 or (800) 478-0036 or (800) 254-3677

Waterfield Mortgage (800) 957-7245
Fax: (260) 459-5390
c/o Loss Mitigation Dept.
7500 W. Jefferson Blvd.
Fort Wayne, IN 46804
(7 am – 10 pm EST Monday – Thursday)
(7 am – 9 pm EST Fridays)
(8 am – 2 pm EST Saturdays)
E-Mail: "saveyourhome@waterfield.com"
Web: "http://www.waterfield.com/scripts/cgiip.ex...rvices/delqasst"

Wells Fargo (877) 216-8448 or (866) 261-5642 or (800)766-0987 or (800) 678-7986 for payment assistance
Borrower Counseling Services
Monday - Friday 8:00 a.m. - 9:00 p.m., CT
Saturday 9:00 a.m. - 2:00 p.m., CT
Web: "https://www.wellsfargo.com/mortgage/account/"

Wendover Financial Services Corporation (800) 934-1081 or (800) 436-1022
Web: "http://www.wendover.com/borrowers.html"

Wilshire Credit Corporation (888) 502-0100
P.O. Box 8517
Portland, OR 97207-8517
From 6 a.m. to 5 p.m. (Pacific time) Monday through Friday
Web: "http://www.wfsg.com/borrower/borrower.aspx"

You can also try Hope Now.....The toll-free hotline, 1-888-995-HOPE, is available 24-hours a day to provide mortgage counseling in multiple languages. It is supported by the HOPE NOW Alliance, announced in October by Treasury Secretary Paulson and Housing Secretary Jackson to reach out and help homeowners who may not be able to pay their mortgage. Fannie Mae is a member of the Alliance, established to create a unified, coordinated plan to help as many homeowners as possible across the nation.

Best of luck to you and please don't hesitate to come back and ask for more help.

[Email address and links deactivated as per forum rules. Thanks.]

lisascherzer · Joined: 04 Jan 2008 Posts: 599 69.58 Dollars($)

Hi SinkingShip,

I wanted to respond to this quote you made:
I guess I'm a little confused about what you said about my lender not negotiating unless I miss payments. I thought it was important to talk to them as early as possible. Are you saying I should purposely miss a couple payments and THEN talk to them?

My advice: NEVER miss a payment and ruin your credit just for a chance to work out payment with a lender. Work out solutions that lenders offer are designed for those that have fallen behind but generally do not lower the payments. Most cases, the payment will be higher to force repayment of prior payments over the next 12 to 24 months. They may add the past due amount to the end of the loan. These work out solutions will not do someone any good that is not behind. If you are having a hardship such as job loss, etc, then you may want to ask for a forebearance. You do not have to be behind in your payments to qualify for this. Forebearance is where they will reduce your payments for a short time.

My suggestiion is to try and refinance if your credit is still good. If you have not been over 30 days late on your mortgage payment in the last year, then you should have some options there. FHA Secure may be an option for you. This is a temporary program that just came out to help those that have adjustable mortgages that have reset and made the payments unaffordable. I think you should at least look into FHA Secure.

gmakerley · Posted: Tue Jan 15, 2008 8:51 am Post subject:

nice response here, lisa. i especially appreciate your second paragraph.

all too many times we have seen advocacy of foolish behavior that wouldn't help anyone. it's nice to see some sanity once in a while.

lisascherzer · Joined: 04 Jan 2008 Posts: 599 69.58 Dollars($)

Thanks George.

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