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Guest

Thank you for this forum for Q&A regarding mortgages.

We purchased our home in Virginia in 2006. We had been stationed in the area long term. (My husband's position with the military had previously given us option to stay.. in fact, they actually wouldn't allow us to transfer).

Our loan was a 30 yr fixed rate (6%) VA with funding fee rolled in through Wells Fargo. Loan amount: $296,000. Current Payoff: $286,000.

I had previously worked in the industry (real estate behind the scenes) and had colleagues work up CMAs and paint a realistic picture (husband was soon deploying, I needed to figure out what to do as we received orders out of area to commence as soon as he returned from deployment).

In 2008, it was one of the first crucial waves of market deteriotion in our area. Rental market was equally oversaturated with 'for sale or rent' listings.

We opted to lease it out at a significant loss. We've been in the negative $1300/mo which is 30% of our net income and MORE than our rent and all utilities at our new duty station. This is WITH A TENANT! We have had several months in 2008 & 2009 that also included major repairs, not covered under our home warranty.

Hardship: We had to sell our 2nd vehicle, drain our TSP/401k, we are living on a poverty level grocery budget, husband has even donated his plasma (believe it or not they pay $100 a time when you've been pumped full of anthrax for since the 90's), sold things, husband is working 2nd job when he's not with the military, I am babysitting and managing the budget cooking from scratch, etc) We can not continue like this.

Husband deploys again in 2010. We have consulted with:
*His command/superiors
*Military family services
*Miltary relief society on base
*Military legal on base
*Realtors in the area for a new CMA (Current market value=$270k)
*Accountant
*Message for the landlord-tenant/real estate attorney in VA that did our settlement

All of the above that we have spoken to said 'get rid of the house now, you are sinking'.

.... communication with the lender ....
I have been pinging on them for over 6 months (loss mitigation). Continually they told me that 'we can't help you, you are not late, you need to be late for assistance'. We didn't want to do that and have a mark on our perfect (730's score) credit report (we've never been late on any creditor bill!)

A few months ago we HAD to be, pantry empty, bills here with our 'four walls' piling up. We call to set pay arrangements. NO. You're negative, system won't let us. I call next month to make new payment. NO. You have to pay both payments, we do not accept partial. Husband secures part time job, I call back, 'Yes, we can make payment arrangements' (Here I'm thinking they're going to put overdue on the back end of loan. Instead I found out when they mail me the letter (after giving them $1,000) which is half of our PITI, that it is a forbearance. They did not tell me on the phone that this included $100 late charge per month on top of the $275/month for 12 months OR that all payments will continue to report LATE until forbearance is complete. I feel deceived and exhausted.

And now.. we owe even more. I'm confused by the entire process and don't know how to unload this house. Husband deploys again in 6 months.

We are in a position to have to let it go into foreclosure, we can not make the increased payments plus additional repair costs (we had another repair with the home that is out of pocket being deducted from this month's rent proceeds.. it was less than the insurance deductible, storm related).

Do we just let it go in foreclosure at this point and give our tenants notice?

Husband's command knows his service record and is researching with security clearance dept to see how they are handling same situations. We are praying he can keep it, but at this point he's willing to take a general billet these last 6 years until he retires AND the major hit on our credit just to move on from this house. It is that serious and we're that tired from the experience.

Thanks for bearing with me.. not too many military resources. I am calling the VA in the morning for some information on deed in lieu and how to approach Wells Fargo. I'm also hoping that my settlement attorney who has a foreclosure dept now can give me some advice, since they are Virginia law oriented.

smithsussane · Posted: Sun Aug 30, 2009 7:39 pm Post subject:

Hi Guest!

Welcome to forums!

If you are delinquent on your mortgage payments for 3 or more months, the lender has the right to start the foreclosure proceedings. However, it is always better to apply for a deed in lieu of foreclosure, before the lender starts the foreclosure proceedings.

Though your credit score will get lowered by around 250 points, you would not be liable for the deficient amount resulting from the sale of the property after a deed in lieu. In case of a foreclosure, you would be liable to pay off the deficient amount. So, in my opinion, you should speak to your lender immediately and negotiate for a deed in lieu if you're planning to sell off the property.

Feel free to ask if you've further queries.

Sussane

Guest

You may also want to do some research on the Servicemembers Civil Relief Act usmilitary.about.com/cs/sscra/a/scra1.htm and see what protections it may afford you - especially if you're husband is once again soon to be active duty.

This link should be considered a "jumping off" point and, like anything else on the internet, shouldn't be considered "gospel" unless verified through multiple sources but it will at least get you going.

If you are dealing with a conventional loan, as opposed to any kind of specialty military financing, you are most likely dealing with a mortgage SERVICER and not the actual note holder/owner of your note. That said, you should also start researching how the entity to whom you make your monthly payments handles military families and delinquency/foreclosure.

Please forward my thanks to your husband for his service and than you as well for your role as a military wife.

Not sure if I can be of any further help but don't hesitate to contact me. I'll be happy to answer what I can.

Mike Dillon
Manchester NH
search " Mike Dillon NH foreclosure"
fcstory at getdshirtz dot com[url][/url]

gmakerley · Posted: Thu Sep 03, 2009 9:36 am Post subject:

mike, that's well-put advice about internet information. i don't think it gets said enough that verification of whatever one gleans from websites is necessary before embarking on a particular journey. i believe, however, that governmental sites that reflect the regulations surrounding various questions are reliable (for example, the irs, hud or ftc).

one thing that people need to be aware of and beware of are that there are plenty of bogus sites pretending to be government-related (like fha.com, which is absolutely not the fha site). let me back off "bogus" in this case - they do make it plain that they're not the fha itself.

in this day and age, people need to be extremely wary of what they believe as "gospel" (in your words, mike).

and for those of us who are actively posting comments and suggestions on this site, i urge those who are reading to recognize that we "think" this or that, or it is our "opinion" about this or that. there may be plenty of expertise up here, what with all these loan officers, etc. but the public still needs to be able to verify everything they've read before jumping.

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2 years after military transfer, foreclosure looming