The Ridiculousness of Loan Modification

This may be too much info about me, but since I already mentioned in a previous post that I put my pregnant self and newborn baby on medi-cal I figure you all know that we aren’t the riches folks in the world, right?  We aren’t the poorest by any means, but we aren’t the richest either.

So, back when Geric started his own business (over two years ago now) we contacted our mortgage lender in order to start the loan modification process. Obama said we could.  We were practically “Joe the plumber.”  My parents had been helping us out with our mortgage and Geric didn’t feel right about that anymore, but since there was also a significant decrease in our income we thought we were a shoe in.  Wrong.

Did I mention that was over 2 years ago?  Because it was.

Since then we have filled out three separate applications (each about 20 pages long), turned in income tax records (for both years), pay stubs every month from me, profit and loss statements in several different formats that weren’t acceptable to “the review team”… even the one from our accountant wasn’t acceptable, contribution letters, quick claim deeds, a couple of other affidavits, and guess what?  We are in the same place we were in two years ago.  That would be in a house that is worth far less than what we paid for it, making less than what we made when we bought it, and no hope in sight… even though the program we’re applying for has the catchy title “Hope for Homeowners.”  Love it.

I guess this post is just a rant.  Because, honestly, there’s nothing funny about it.

A couple of days ago, the day before Geric left for a missions trip for a week, the mailman came to my door with 40 pieces of certified mail.  40 pieces!  Practically a fourth of the rainforest.  Geric, my mom, my dad, and I all received 10 envelopes and within those envelopes there were two different letters (each repeated 5 times.)  I suppose they didn’t want us to use the excuse that “we never got that letter.”  Don’t worry, we won’t.  Each letter said two things.  The first one said that we owed a debt.  Thanks, Captain Obvious!  The second said that we were in foreclosure.  Cue the piano to drop on my head.  I mean, I knew it was a definite possibility.  Actually, I knew it was more than a possibility, but when it really happened, it was just shocking.

The problem is that we really wanted to try and short sell our house, but we can’t even apply for that until we’ve been rejected for a loan modification.  So we called the bank the day we received our “fan mail” to see if any progress was bring made in the way of a loan modification, and guess what?  They need another contribution letter (slightly re-worded), the quick claim deed to be faxed (for the third time), and last months profit and loss statement from Geric.  Really?  Really?

I feel like I’m being played with.  I feel like they’re just stringing us along.  I feel like we are getting royally screwed, and there’s absolutely nothing we can do about it but keep answering they’re requests, hope for the best, and hope that a sheriff doesn’t come knocking at my door and tell me I have 30 days to get out of my house.

It sucks even more knowing that we actually started off doing the right thing.  We bought our house putting 20% down and we got a 30-year-fixed-loan.  And, honestly, they didn’t even start taking out requests seriously (as if they’re serious now) until we stopped paying our mortgage, which we had faithfully been doing for a year and half of this ridiculous process.  It’s almost as if we are being punished because we did things right and everyone else that bought a house with nothing down or with a government arm loan is being told, “Oh, bad move.  Here let me help you.”  No offense if you did that, but those people went into it knowing there was a risk that their mortgage would go up significantly.  So why are they being soothed and we are being ignored?  It just seems backwards.

I know, in the end we’ll be okay.  We won’t be homeless, ever.

But It’s the injustice of it all that’s killing me.  It feels like nobody cares.  Like all they care about is their money.  And I don’t expect Obama to care about me individually, but where’s the hope and change, Big Man?  (Sorry, was that out of line?  The “big man” reference I mean.)  I kinda want to call up Michael Moore and have him make a documentary about the injustices of the housing market, but it seems like he’s simmered down since democrats have taken over, doesn’t it?

I don’t know.  It’s all enough to make me want to throw up, really.  The unknown is a killer.  And being completely out of control is even worse.

So, anyone been through this before?  Can you relate?  

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8 responses

  1. We were in the exact same boat a year or so ago. Isn’t it soooo frustrating? Our bank denied the loan remod and denied a short sale. They came to appraise it (by appraise I mean some guy came at 8:00 at night and took a picture of the front door) and said it was worth more than we bought it for. Yeah, ok, sure. That explains why it sold for about half that after it forclosed, right? Anyhow, we are happily renting now in a bigger house in a nicer neighborhood. And when the septic system goes bad, we don’t have to deal with it! Hang in there, the Lord will walk you through. 🙂

  2. Same here, they told us “You’d have a better chance if you had more debt” Reward those that racked up their credit cards and bought that brand new RV!
    Our house is worth half what we paid for it, if we bought a bigger house in our same neighborhood and let this one foreclose we’d save $1200 a month. Unfortunatly we like our house and dont want to move so it makes sense for the banks to work with us and lower our payment instead of us leaving it and them have to go thru the whole process to sell it to someone else for a lower amount. We’re w/B of A and planning on going to one of those all day forclosure meetings next month where you bring all your crap and wait and wait to meet 1 on 1 with someone – it’s our last chance, here’s hoping!

  3. Why is it that anything the government runs by definition could be better managed by a 3 year old?! Spending so much time dealing with this while juggling three little monkeys must be tough! Your family will be in my prayers! Remember, even if the world doesn’t value the fact that you guys did it “the right way”, God does! I know you know that He cares for and loves your family far more than the “sparrows”! Praying you will feel that truth as you walk through this time!

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  5. The injustice of it all. That is totally ridiculous. You should sue. 🙂 Just kidding.

    I can’t say that I know how you feel…we are renters…but I can say that I am sorry. I truly am. there is NOTHING worse than money stress.

  6. hey there… i can actually say been there done that. Its difficult. We went through it for two years. We tried so many different things and it was a very trying time in my walk. We have now been out of the house and renting for 1.5 years. What i have found is that the banks dont care if they give you a loan modification or not. Because good ole gov’t with cover their butt if you foreclose. So strangely in a sense they make more money if you do foreclose. When i was going through it i thought it was different… but oh no!!! SO NOT TRUE. After I went through i started to do research only to find that the reason they will not work with the home owners is because … if you foreclose then that property becomes theirs and becomes an asset to them so they could borrow more money…. if you foreclose when they do sell the house the gov’t will give them a percentage of what lost on your loan on the house. So… they get the house … plus they get $ from the gov’t to cover anything they did lose. So they are not losing and at times they will be making more money. I know people have gotten modifications… Im not saying they dont happen because if GOD wants you in the house THERE YOU WILL STAY ! If God wants you to move then THEN THERE YOU WILL GO. I remember it was so hard to be in that spot but know that Jesus has a plan and sometimes we have to trust Him with his plan (not saying that your not.. i just remember the emotions and things that i went through and it can be hard to trust what is to come when we have no control). I am so much happier in the house we are in now. For one its smaller so much less to clean. Its a one story which i hated having to go up and down the stairs for everything. My backyard is big enough for the kids to actually play in it. So those things I am thankful for. I am sad that we do not live in the other house my husband and I bought together. I am sad that we put money into the house and put work into the house and lost it all. It was difficult to let go but in the end, I am glad that we we moved. I wish I knew what I know now. I would have chosen to do things much differently. But it is what it is and we are just to go with it. If you want to know specifics message me on fb.

    • Thanks Rebecca. It’s nice to know other people have made it through this! I talked to a housing counselor from a government program called Hope Now a couple of days ago and she’s kind of acting like a go-between. We called our bank on conference call and you could tell they were shakin’ in their boots when she said she was calling on our behalf. I don’t know. Maybe something will happen now. But I’m not holding my breath!

  7. It’s so sad that this has happened to so many people. My best friend and her husband lost their house years ago now. I know many people that have had to foreclose. At least you’re right that you will always have a place to go and never be homeless.

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