Hi I need advice/help

Amy · Joined: 21 Aug 2007 Posts: 12 Location: California

Me and my husband bought a home Sept 1, 2006 we have been in this home for almost a 1 year now and we got in at 100% financing, everything is in my name only, well the broker (that was a trusted friend) promised to refinance us after 6 months cause he knew from the get go we could not afford this loan he was putting us in, he lied about a lot of things and I signed all this cause I trusted him completely well after months and months of calls never returned and lies upon lies to me the refi fell through and me and my husband are not late on any payments as of yet, but we will be soon and we are afriad of loosing our home. I have talked and submitted my paperwork to a number of lenders/brokers/direct lenders and have even been out money for an apprasial (all for nothing) this is what I email to potential lenders:

Hi,

I really have had nothing but bad luck since I have started this nightmare back in Nov.2006 have been through one broker that, honestly I told to go to hell after spending and wasting months of my time. I am working with one lender for the past two months at Pacific 1 Lending and he is also having a hard time placing me and just got in contact and submitted my paperwork once again to another lender this morning and so far what both these people are saying is I am only good enough for a pick a payment loan (if that)

I owe a total of $415000.00 on both my first and second I have prolly about $6500.00 in deliquent property taxes due I have no impound accounts as of now.. The broker that got me into the home totally skrewed me he promised me and my husband a re-fi after 6 months and this was a family friend (so much for friendships).. We dont want to loose our home we just cant afford this second and that is what is killing us the second I owe about $83000.00 and payments are 723.00 the first I owe about $332000.00 and payments on that is $2191.00 I would like to have my account impounded with at least my taxes my insurance me and my husband can pay if need be. I need to re-fi badly to get a lower payment and get my property taxes taken care of.

- How long have you owned the home? 1 year Sept 1st

- Are you looking for the lowest rate or lowest payment? both

- Do you want 1 mortgage with PMI or 2 mortgages? no PMI

- Would you look at terms less than 10-Yrs (i.e. 5 or 7 Yrs)? Yes

- Are you able to document your income/assets? Yes

- Will you escrow your taxes and insurance? Yes

- Do you know your credit rating or scores? 691

- What is your current interest rate/term? 1st is about 7.25 and the second is 9.75 (something like that)

I have an apprasial for $455000.00 and I found out by one lender the loan amount they were asking for was $432250.00 that leaves me with a 95%LTV..

Trust me I have heard all the bad news and all the downs and all the rotten programs out there I also know the Alt A programs are almost done with and I also know that the market is very bad right now.

So, so far I have only been told about a 3 year option of a pick a payment program that can defer intrest to my pricipal which I dont like but I need out of what I have now and hopefully this market will move in a couple of years so I am looking at ARM 5/1, 7/1, hybrid's anything that will suit our needs.

Let me know,

Thanks for your time

Amy Beaudet

I hope that sums up some of my story, I am desperate and just feel like there is no light at the end of my tunnel :( is there any help for me anywhere? and one thing I do not want is a pick a payment loan I do not want a neg am loan at all.

David · Joined: 19 May 2004 Posts: 754 Location: Atlanta, GA

Wow, that sounds like quite a predicament. There are a couple of pretty knowledgeable people here, and I hope you will get some good advice in the next couple of days.

This may be a stupid idea but...
Would you possibly be able to find a renter that could share the house with you to help ease the burden?

Amy · Joined: 21 Aug 2007 Posts: 12 Location: California

I wish but we have a 3 bedroom 2.5 bath all the rooms are upstairs and we have 3 boys also :? unless someone wants to sleep with the dogs in the garage...LOL...

I wish there was a way to hold some of this responsibility on the broker who did this deal for us to begin with but I dont know who or where to go for that either :(

m2c · Joined: 03 Aug 2005 Posts: 937

I suppose you realize that your story is stretching the creditability envelope of any LO on this board. It’s hard to believe any LO would make such statement and/or tell you to falsify documents. On the other hand why would agree to purchase a home you could not afford or even afford to pay real estate taxes thereon? Only escape hatch might be an assumed HUGE increase in property values (in 6 months???). I think they call this California dreaming. $415K to current appraisal of $455K in 6 months? Possible but I suspect any LO would take a long, hard look at the new appraisal.

Assuming everything you said is gospel, you could WITH SOME COOBERATING PROOF go to the FBI fraud squad. This could get the LO in hot water but bear in mind YOU and YOUR HUSBAND have made very serious false statement and violated the law.

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

m2c is probably a bit harsh, but his point is very valid. While I won't say that I would be as straight as he is about the honesty of the world of brokers, it's very difficult to pin it on that individual and make them 'pay' so to speak. Especially with the fact that you knowingly signed documentation that defrauded the lender. (I.e. he goes down, you're going down with him.)

The difficult part is, there's not a whole lot of options that are much better than what you're in now. If you refinance it all to one loan, you're looking at PMI, or a cost (points) to offset an increased rate to pay for the loss of the PMI. Your score's not bad, so there's no concerns there, it's just what really makes sense for you?

I find it amazing that in the market as it is today, there are still people stupid enough to even offer neg-am loans as a way 'out'. Don't consider this, and if they're offering this to you, you should probably scratch them off your Christmas list.

You may want to consider looking at what you can afford payment wise, and seeing what price range that would put you into. Nobody wants to move a year after they got into a property, but nobody wants a foreclosure on their credit either.

If that won't work, then what I would recommend doing is a rate/term refinance combining your first/second. If your ratios are high, you can consider pre-paid interest payments which can help to reduce your monthly payment by a pre-determined amount. Your escrows can be (and would likely be required to be) included in your payment. It *might* make sense to use LPMI as I mentioned in another post, if you have the potential to keep your loan at 90%. This would be a very marginal increase in rate (or cost) but would be a huge change in the amount of your payment (due to not having PMI.)

Another thing to consider is the loan amount. When you go over $417,000 you've just jumped out of the conforming market, and that'll increase your rate by a fair amount right now (about...1/2% or so.) This may be impossible to avoid, but it's something you'd want to know up front. (It may make sense to keep it at 417,000 and do a very small 2nd mortgage to simply cover taxes and costs, so your total payment doesn't see that much of a difference overall. I say may because I haven't whipped up numbers to see how much of a difference.)

I've seen first hand brokers and lenders that flat out do precisely what you've just mentioned in your post, so it doesn't come as a surprise to me. Many people are ignorant of loans at all, and remain that way through out the process. (Their own desire or the lenders inability to do their job correctly, you decide.) The net result is that ignorance is not an excuse for breaking the law, and it's identified very clearly in your application that if you sign the dotted line, the information contained is to the best of your knowledge accurate and true, and if you lie you just might find yourself wearing an orange jumpsuit in the near future. Going forward, whoever you choose to work with, make sure they go through the loan and detail out what you need to do, what you need to know, and how you're going to get from start to finish. They should be willing to do this at no cost, end of story.

As far as the appraised value, this is not a surprise either. Not long ago some friends of mine sold a condo four months after we refinanced them for 15% more than the appraised value at the time.

Keep in mind that those of us on this forum (that stick around at least, not the onesies and twosies) have very high ethical standards, and so some times it can be difficult to see all of the potential pitfalls that others may throw out there. m2c mentioned that any LO would take a long look at the new appraisal. My experience would be that most LO's would look at that appraisal and see one thing: cash in pocket. If they're not willing to take a look at the appraisal, they are not likely worth your time.

Hope that gives you some food for thought for the evening.

Do not falsify any of the information, no matter what the salesman tells you is allowed.

chow · Posted: Wed Aug 22, 2007 1:07 am Post subject:

How do I file a complaint against a lender who is not FHA approved?

Answer
If you have a problem, the best place to have it fixed is at its source (the lender, settlement agent, broker, etc.). If that approach fails and you think you have suffered because of a violation of the Real Estate Settlement and Procedures Act (RESPA), Equal Credit Opportunity Act (ECOA) or any other law, you may be entitled to sue in a federal or state court. This is a matter you should discuss with your attorney.

The Federal Trade Commission (FTC) handles complaints concerning most non-bank lenders, such as, mortgage companies, finance companies and state credit unions. The FTC Bureau of Consumer Protection also has resources for victims of identity theft and credit scams. To file a complaint or to get free information on consumer issues, visit the FTC at http://www.ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261.

Amy · Joined: 21 Aug 2007 Posts: 12 Location: California

I would like to thank you all for your input it is much appreciated, everything that I had stated is true facts and yes I did sign the documents, but I trusted him completely and belived in him when he told me he would wrap my taxes into a re fi, I mean he knew I could not afford the second on my home and after three meetings with him and talks on the phone he assured me that everything would be fine and I did, I did sign but for him to just drop the ball on everything is just not right.. I guess what I did was fraud also but it was all done under his say and his reassurance and... well I just dont know what to do anymore.. I am tired of being in tears and watching my whole life fall apart before my eyes and there is nothing I can do :cry: I have two apprasials done one is expired and one is about to expire and they both appraised for $455K we have done a lot of upgrades so I dont see why it surprises some of you that it appraised out for that. I bought this home from a seller that was one day away from the bank taking over so that is why we got a deal on the home.. The first we dont have a problem paying it is just the second and now the deliquent taxes..

I really do appreciate all your reply's and opening my eyes to the fraud and I think to myself, Heck I am already going down so skrew it I will take him with me but then I have to think about my 3 kids also..

Thanks for your time,
Amy

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

Review what I said. You're not out of options, you just need to review the options carefully. Upgrades can certainly increase the value of a home, depending on what you have done to the property.

Think about what you need to accomplish, which is a lower monthly payment. As I mentioned, you need to figure out what you can actually afford. Once you've figured that out, then it makes everything else much easier for figuring out how to make that happen with out making you go into foreclosure.

David · Joined: 19 May 2004 Posts: 754 Location: Atlanta, GA

Good luck with everything. You seem to be at least educating yourself, and hopefully you will have some good new information that will help you figure out what to do from here. I hope you will report back later, and let us know what happened.

ken(TX) · Joined: 23 Sep 2005 Posts: 184 Location: Dallas, TX

just curious, but what City/County/State are you located in and what is your annual pre-tax household income? I'm thinking that the reason the people you are working with are suggesting you look at a pay-option-arm is due to your debt vs. income percentage being too high for a fixed rate loan. I don't know this as you haven't provided enough information to that effect. Just a possibility

Amy · Joined: 21 Aug 2007 Posts: 12 Location: California

City~ Fontana

County~ San Bernardino

State~ California

My gross monthly income is $3620.00 (and that varies on sales for my bonus check every month)

My husbands is $2300.00 and now he is working overtime and also rcv's a bonus check monthly also so it will go up to about $2700.00

We make about $84000.00 a year combined

We had two car payments, One credit card with $1800.00 and that is it.

A few months ago we did get hardwood floors in and that payment is deferred until 5/2008 so no payments due until then and that will be paid in full but the new year. But that is all my credit score is 691, 691, & 682 and my husbands is 668, 665, & 664

Quote: due to your debt vs. income percentage being too high

Yeah I believe so

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

Bonus and Commission won't count unless they have had them for 2 years.

Amy · Joined: 21 Aug 2007 Posts: 12 Location: California

We have both had commission/bonus checks since day one of working here, lets see I have been here 7 years 9months and my husband has been here for 10 years :wink:

ken(TX) · Joined: 23 Sep 2005 Posts: 184 Location: Dallas, TX

Amy, you may not like this answer but here it is.

You need to sell this house. You cannot afford it now any more than you could when you purchased the home. If you do not sell the home, eventually you may be unable to keep up with the payments and will lose it via foreclosure. I'm estimating you could afford about $100,000 less house and payment.

I know that selling the home, moving, etc. are emotional decisions and you must way in practicality and planning while I'm just crunching numbers here. But that's what the math tells me you need to do.

good luck.

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

Amy,

Ken and I seem to agree frequently, and this is one that I really truly believe is in your best interest. I mentioned it above, Ken mentioned it here. Take the equity you have and put it towards a new home that's better on the affordability.

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