We bought our house in 2006 (it was built in 2005). We presently owe over $260,000 on our mortgage.

Our house is now worth no more that $160,000

Real estate values have collapsed in our neighborhood (there and several vacant houses on our street).

We have an Adjustable Rate Mortgage. Our mortgage payments will increase in Feb., 2010.

We can rent a house on our street for half the cost of our mortgage payment.

We are both employed. We have no credit card debt.

We do not need credit. We do not especially care if our credit report gets clobbered by failure to make mortgage payments.

Our neighbor has failed to make mortgage payments for eleven months. He received a foreclosure notice in the mail. A lawyer told him that he can still live in the house for at least four months longer (without paying anything).

Our State laws prohibit a lender from suing a homeowner who defaults on the mortgage.

If we stop paying our mortgage, we will be able to save at least $20,000 in the next year (we will need this money for college for our kids). Then we can move across the street and rent. Then in three years we can get an FHA loan and re-buy a house at a fair price.

So why not just stop paying our mortgage? What do you think?

The downside is that your credit gets hit for five years or so, but you sound like you can handle that.

You may need that credit when college time comes around.

A better bet is to call the mortgage lender, tell them your situation,and see if they will renegotiate. They stand to lose some big bucks if they dont, and you might get a mortgage that cost less than rental, keep the property, and keep your credit in tact. The bank knows they wont get more than $160K for the house, so they should be willing to renegotiate.

We bought our house in 2006 (it was built in 2005). We presently owe over $260,000 on our mortgage.

Our house is now worth no more that $160,000

Real estate values have collapsed in our neighborhood (there and several vacant houses on our street).

We have an Adjustable Rate Mortgage. Our mortgage payments will increase in Feb., 2010.

We can rent a house on our street for half the cost of our mortgage payment.

We are both employed. We have no credit card debt.

We do not need credit. We do not especially care if our credit report gets clobbered by failure to make mortgage payments.

Our neighbor has failed to make mortgage payments for eleven months. He received a foreclosure notice in the mail. A lawyer told him that he can still live in the house for at least four months longer (without paying anything).

Our State laws prohibit a lender from suing a homeowner who defaults on the mortgage.

If we stop paying our mortgage, we will be able to save at least $20,000 in the next year. Then we can move across the street and rent. Then in three years we can get an FHA loan and re-buy a house at a fair price.

So why not just stop paying our mortgage? What do you think?

In you position, i would probably do the same thing…Quit paying and save some money for a year til they throw you out.

Of course no one can predict what the real estate market will be like in 4 years…The same house could be worth more than 260k in 4 years….or what the mortgage rules will be at that time.

My boyfriend’s house is currently in foreclosure. He is six months behind on payments. The sale date is two months away. If he can come up with the past due amount and pay it to the lender, will the foreclosure go away?

That is up to the lender, but usually the would welcome having a loan brought up to date. He will probably have to pay late fees, legal fees and additional interest.
He should call them pronto to work this out.

My residence was foreclosed and sold at auction. I had a 1st and 2nd mortgage. The home was sold for a little more than what was owed on the 1st mortgage. I do not know if the 2nd mortgage holder received a dime. I contacted an attorney before the sale and he said that in his 30 years of practice he has only seen one time that the 2nd mortgage holder filed a lawsuit. I figured that since we are in a foreclosure climate they probably won’t come after me. I am now wondering if I do get the 1099 that they are forgiving the debt and that frees me from a lawsuit. It would certainly relieve some stress even though I would owe tax.

it really depends on the state laws where the property is located. If there are deficiency laws in that state, do not be suprised if the 2nd goes after the full deficiency. I would call the 2nd lien holder to see what they intend to do.

Does anyone know any way I can stop foreclosure and how many months before they start foreclosing I am desperate not to lose my home HELP!!!!PLEASE

Call the mortgage holder and find out how to pay the arrears.

Sub-prime lending is a type of credit given to homeowners who do not meet the criteria for regular (“prime”) loans. A typical sub-prime borrower has a poor or limited credit history and a FICO score of less than 620. These factors make them a risky investment for regular lenders, which keeps them from taking out loans. To compensate for the risk, sub-prime lenders impose higher costs on their contracts. For credit cards, this is usually a higher fee for over-the-limit spending or late fees. Sub-prime mortgages usually have higher interest rates and stricter terms.

 

Contrary to popular belief, sub-prime lending is a perfectly legal business. But like many new industries, it has been tainted by lenders who don’t play by industry standards. From 2003 to 2007, shady companies have turned up offering terms ranging from unfair to downright illegal. This, along with the economic slowdown, has contributed a great deal to the real estate crisis that forced many homeowners into foreclosure.

 

Are all sub-prime loans bad?

 

No. There are actually some sub-prime companies who give you good value for your money. If you find a good lender and stay current, sub-prime lending can have its benefits.For example, many people use sub-prime loans as a means of credit repair. Basically, it gives you a chance to rebuild your credit history and improve your scores. By keeping up a good record on sub-prime loans, you can eventually refinance to better terms and get back on your feet.

 

How do I know when a loan is sub-prime?

 

The first thing you should look at is the cost of the loan. Sub-prime loans have a higher overall cost (including interest, origination and closing fees) compared to prime loans. Although the basic formula is the same for both types, the pricing for sub-prime loans is more noticeably risk-based. A low credit score, small down payment, and other negative factors can greatly increase the cost of a sub-prime loan.

 

Another common feature is the prepayment penalty. Prepayment is when you pay more than the minimum monthly amount, or pay off the loan ahead of schedule. The penalty is to make up for lost interest on the lender’s part. Because you’re getting off early, the lender stops earning regular interest—and naturally, they charge you for it.

 

Many sub-prime mortgages follow the 2/28 structure. This means that you pay a fixed interest rate for the first two years, after which the loan switches to an adjustable rate where your payments are determined by market indicators. Often, the introductory rate is higher than the current index and the margin is applied once the loan shifts. For example, a lender can give you an intro rate of 8% while the index is currently at 4%, with a margin set at 6%. Assuming the index stays the same; your rate can jump to 10% when your two years is over.

 

What can I do if I’m in a sub-prime loan?

 

Fortunately, there are laws in place to protect borrowers in any loan, prime or sub-prime. For instance, the Real Estate Settlement Procedures Act (RESPA) requires all lenders to give you a good faith estimate of the total cost of the loan before closing any deals. This prevents any third party, such as mortgage brokers, from making any kickbacks at your expense.

 

All mortgages are also covered by the Truth in Lending Act (TILA). This law gives you the right to know the full lending terms and loan costs in any credit transaction, including credit cards. The TILA allows you to opt out of a transaction within a reasonable time if you don’t agree with some of the terms.

 

If a sub-prime mortgage has put you in financial difficulty, another thing you can do is apply for Loan Modification or in this case Sub Prime Loan Modification refers to an agreement between you and your lender to change the terms of your loan on account of your financial situation. This way you can modify your loan terms to a more affordable level. The Sub Prime Mortgage Loan Modification is a lengthy and time consuming process. However a competent loan modification attorney can expertly handle your case and expedite the loan modification process. A loan modification attorney will expertly present your case and use the above mentioned lending laws as leverage to get you more reasonable rates. If you’re already in foreclosure, this will also stop the process while you work out better terms with your lender.

Loan Modification Attorney
http://www.articlesbase.com/mortgage-articles/sub-prime-loan-modification-755602.html

Sub-prime lending is a type of credit given to homeowners who do not meet the criteria for regular (“prime”) loans. A typical sub-prime borrower has a poor or limited credit history and a FICO score of less than 620. These factors make them a risky investment for regular lenders, which keeps them from taking out loans. To compensate for the risk, sub-prime lenders impose higher costs on their contracts. For credit cards, this is usually a higher fee for over-the-limit spending or late fees. Sub-prime mortgages usually have higher interest rates and stricter terms.

 

Contrary to popular belief, sub-prime lending is a perfectly legal business. But like many new industries, it has been tainted by lenders who don’t play by industry standards. From 2003 to 2007, shady companies have turned up offering terms ranging from unfair to downright illegal. This, along with the economic slowdown, has contributed a great deal to the real estate crisis that forced many homeowners into foreclosure.

 

Are all sub-prime loans bad?

 

No. There are actually some sub-prime companies who give you good value for your money. If you find a good lender and stay current, sub-prime lending can have its benefits.For example, many people use sub-prime loans as a means of credit repair. Basically, it gives you a chance to rebuild your credit history and improve your scores. By keeping up a good record on sub-prime loans, you can eventually refinance to better terms and get back on your feet.

 

How do I know when a loan is sub-prime?

 

The first thing you should look at is the cost of the loan. Sub-prime loans have a higher overall cost (including interest, origination and closing fees) compared to prime loans. Although the basic formula is the same for both types, the pricing for sub-prime loans is more noticeably risk-based. A low credit score, small down payment, and other negative factors can greatly increase the cost of a sub-prime loan.

 

Another common feature is the prepayment penalty. Prepayment is when you pay more than the minimum monthly amount, or pay off the loan ahead of schedule. The penalty is to make up for lost interest on the lender’s part. Because you’re getting off early, the lender stops earning regular interest—and naturally, they charge you for it.

 

Many sub-prime mortgages follow the 2/28 structure. This means that you pay a fixed interest rate for the first two years, after which the loan switches to an adjustable rate where your payments are determined by market indicators. Often, the introductory rate is higher than the current index and the margin is applied once the loan shifts. For example, a lender can give you an intro rate of 8% while the index is currently at 4%, with a margin set at 6%. Assuming the index stays the same; your rate can jump to 10% when your two years is over.

 

What can I do if I’m in a sub-prime loan?

 

Fortunately, there are laws in place to protect borrowers in any loan, prime or sub-prime. For instance, the Real Estate Settlement Procedures Act (RESPA) requires all lenders to give you a good faith estimate of the total cost of the loan before closing any deals. This prevents any third party, such as mortgage brokers, from making any kickbacks at your expense.

 

All mortgages are also covered by the Truth in Lending Act (TILA). This law gives you the right to know the full lending terms and loan costs in any credit transaction, including credit cards. The TILA allows you to opt out of a transaction within a reasonable time if you don’t agree with some of the terms.

 

If a sub-prime mortgage has put you in financial difficulty, another thing you can do is apply for Loan Modification or in this case Sub Prime Loan Modification refers to an agreement between you and your lender to change the terms of your loan on account of your financial situation. This way you can modify your loan terms to a more affordable level. The Sub Prime Mortgage Loan Modification is a lengthy and time consuming process. However a competent loan modification attorney can expertly handle your case and expedite the loan modification process. A loan modification attorney will expertly present your case and use the above mentioned lending laws as leverage to get you more reasonable rates. If you’re already in foreclosure, this will also stop the process while you work out better terms with your lender.

Loan Modification Attorney
http://www.articlesbase.com/mortgage-articles/sub-prime-loan-modification-755602.html

I bank with Bank of America and was wondering how many months i could fall behind on my mortgage before they could start the foreclosure process and stop accepting additional payments from me? I have not gotten behind yet but was thinking of doing so to cushion my own account in these tough times.

Talk to the bank rather than ‘voluntarily’ defaulting on your mortgage.

Mortgage in foreclosure sold to new lender as of 8/11/09. Rcvd notice and "welcome" from new lender. Filed for loan mod with them 8/31/09 thru non-profit. Rcvd registered letter 9/18/09 Trustee Sale 10/07/09 by PREVIOUS lender’s agent. How to stop unauthorized sale, attorney?

The sale is not unauthorized. Homes in the middle of a foreclosure process are sold to new investors all the time. If they haven’t already, they will file the proper papers with the court to change the name of the plaintiff, but that won’t stall the proceedings.

My husband left me and our son on November 2007 so he can be with his girlfriend and told me that we were getting divorce. On February 2008 we had to renew our mortgage. He filled out mortgage application with no co-sign. The lady from Quicken Loan came to my house and told me that I had to sign some papers. Both me and my ex said that I should not signed anything because I have no income and we were getting divorce, but she insisted for me to do it because I was still legally married at that times, so I signed the papers. My ex stop making mortgage payments since December last year. We got divorce on few months ago with an agreement that my ex husband will take full responsibility for the house and expenses related to the house. Few days ago, I received summon from the court with my ex name and mine as defendants and it said that I am responsible for the house being foreclosure. I called the lawyer who represent the mortgage Company and she simply said that I signed the document so I am responsible for it and suggested to find a lawyer.

I look at the mortgage documents. The application has no co-sign and only has my ex name. But then I found out that Quicken Loan put my name on the deed (the original deed has only my ex name), and my name on the mortgage sheet (but not mortgage application). Whenever I called the mortgage company they won’t talk to me because they said my name is not on the mortgage list.

Is there anyway I can get away with it. My ex told me not to worry because the divorce decree mentioned that he will take full responsible for the house. I just spent 8000 for a divorce lawyer fees and I don’t make a lots of money from my jobs since I just starting getting back to work. I am taking care our son by myself, working full time and going to school.

Please help me. Thank you.
On the MORTGAGE section
(B) "Borrower" is my ex name and my name, husband and wife
Is that mean I also a borrower? or is it because my name is on the deed. I really appreciated anybody help who answering my question. Thank you.

I’ll be honest…I didn’t read your post because 99% of it has nothing to do with the foreclosure.

Your name is not on the loan…that means you are NOT legally responsible for the MORTGAGE with the bank.

If your name is on the TITLE..that makes you an OWNER of the home and whenever a house is foreclosed on, ALL OWNERS must be notified.

Your credit is not going to be affected because there is no mortgage account to tie the foreclosure to on your report and the fact you signed no legal contract with the bank.

What you signed with Quicken Loans is called "marital interest documents"…they are required by your state anytime you are legally mmarried, the day of the closing of the loan, whenever the financial situation on the mortage changes.

It is common and is NOT a mortgage note. The documents ONLY state that you are legally aware of the changes…not one thing more….that prevents one spouse from stripping the equity of the house and gambling it away without the other spouse knowing about it.

It is that simple..you are making this WAY more complicated than it is.

If you no longer live in the home, you do not have to get an attorney….b/c you don’t have a right to the house, per your divorce decree.

Nothing an attorney can do for you.