Foreclosure and Short Sell !!PAYBACK!!

[Nikita2Charles 32]

With so many foreclosures happening you would think the banks would try to work with the homeowners to help them avoid foreclosure, but they are playing an ALL OR NOTHING HURTFUL GAME with the homeowners.

One of the worst hit area of the country, the San Juaquin Valley, The stockton, Lathrop, Tracy area.

The guy bought the house at peak for $580,000, the housing market in that area has depreciating so much, the new value is now $250,000, but yet the bank still want the loan money for $580K.

Here's the tricky part for almost a year, the guy stopped paying and the bank will not modify the loan.

Now the house is going into a short sale by the bank for $180,000. He would gladly stayin in the house if the bank had reduce to loan to let say, $250,000 or even $300,000

SADLY the bank would rather give the house to someone else, rather than give the homeowner a BREAK, I am in almost the same situation and been fighting back to follow my colleague FOOTSTEP since the bank won't give us a break.

Lot of people stop worrying about credit score now with the way the banks are acting up. Two Credit card companies just dropped the credit limit from $15,000 to $5,000. Another card dropped from $27,000 to $7,000, Banks are reducing your credit limit even though you have good credit record and never had a late payment, when called them they say low utilization as an excuse.

The PAYBACK.

That money saved from Last year got put to good use as Downpayment to a new home, he used his Uncle as the buyer to a new house for $350,000.

Same Scenerio but this time, This lady used her cousin to buy her house that went into short sale. $560,000 bank won't modify the loan, and sold it in short sale for $185K

So Same house just different ownership.

Edited May 14, 2009 by Nikita2Charles

[one...two...tree 2,762]

Stupid banks.

[Otto 83]

Now why is it right to stop paying on your mortgage simply because the value dropped?

(Presumably/hopefully this isn't the reason but none was stated.)

[Nikita2Charles 32]

why is it right to pay the bank 3times the value of the house mortgage worth. Both banks and homeowners created that mess, Why is it right only the homeowner has to carry all the weight?

Why is it right for the bank to sell those mortgage payments as investment securities fueling the housing boom, and That STUPID STIMULUS paid off all those investment securities the original loan worth then RAN and the homeowner is left hanging, where's their stimulus package?

Why is it rigth for the bank Appraiser to Inflate the house worth by $80,000, then the Current homeowner Increased the Price on MLS after the bank new appraisal, when I was purchasing the house.

The right thing to do was to Walk out of the deal.

Now why is it right to stop paying on your mortgage simply because the value dropped?

(Presumably/hopefully this isn't the reason but none was stated.)

Edited May 15, 2009 by Nikita2Charles

[GaryC 7]

I read a story somewhere, can't remember where, that a person went to a bank auction and bought a house for about a 1/3 what it was worth. She then sold it back to the person that lost it at zero interest and payments that they could afford. It would be nice to see more of that.

[Nikita2Charles 32]

That's my point Gary, you would think the bank would be the one doing that kind of initiative.

THey only problem with that scenario you can't buy it on your name, you would need to have someone with good credit, and at least 20% down, but with 1 year of mortgage payment saved up, that's enought to get a 20% down

They are forcing homeowners to go into short sale and foreclosures.

Straight from a financial counselor at the bank, as long as they are getting your money, you are way at the bottom of the priorty list, in this current market, don't worry about credit score, lot of people are in the red, Once you stop making payment after a couple of months you'll upgrade your priority status and they'll work with you

Edited May 15, 2009 by Nikita2Charles

[Danno 1,228]

why is it right to pay the bank 3times the value of the house mortgage worth. Both banks and homeowners created that mess, Why is it right only the homeowner has to carry all the weight?

Why is it right for the bank to sell those mortgage payments as investment securities fueling the housing boom, and That STUPID STIMULUS paid off all those investment securities the original loan worth then RAN and the homeowner is left hanging, where's their stimulus package?

Why is it rigth for the bank Appraiser to Inflate the house worth by $80,000, then the Current homeowner Increased the Price on MLS after the bank new appraisal, when I was purchasing the house.

The right thing to do was to Walk out of the deal.

Now why is it right to stop paying on your mortgage simply because the value dropped?

(Presumably/hopefully this isn't the reason but none was stated.)

NOw lets assume the value of the house had "shot up"... and instead of your house value dropping.. it soared (as it did for so many people earlier).. would the bank then get to "renegotiate" the loan to get some of your profit or .... do you only expect the bank to share in your loss?

The very thing that you blame the bank for.... made both winners and losers depending on when you bought.

[Peikko 1,575]

Not that ANYONE is advocating paying nothing as an option, but having interest rates on a loan based on the principle that the loan is on an asset that is appreciating as apposed to a depreciating one is quite scandalous because in this case it leads to destitution which is more costly on society than trying to keep people in the homes that they already have. Surely there is some way to re negotiate the loan based on current values with the option to re negotiate upward again if and when house prices go up?

[Bobby+Umit 161]

why is it right to pay the bank 3times the value of the house mortgage worth. Both banks and homeowners created that mess, Why is it right only the homeowner has to carry all the weight?

Why is it right for the bank to sell those mortgage payments as investment securities fueling the housing boom, and That STUPID STIMULUS paid off all those investment securities the original loan worth then RAN and the homeowner is left hanging, where's their stimulus package?

Why is it rigth for the bank Appraiser to Inflate the house worth by $80,000, then the Current homeowner Increased the Price on MLS after the bank new appraisal, when I was purchasing the house.

The right thing to do was to Walk out of the deal.

Now why is it right to stop paying on your mortgage simply because the value dropped?

(Presumably/hopefully this isn't the reason but none was stated.)

Nobody forced anyone to pay for homes like that.

Most, if not all, of the 'mortgage" stories I see are people making less than $75,000.00 a year or less, and whining about being in a house that cost $450,000.00+.

Sorry - I have no sympathy for people that did that.

[Danno 1,228]

why is it right to pay the bank 3times the value of the house mortgage worth. Both banks and homeowners created that mess, Why is it right only the homeowner has to carry all the weight?

Why is it right for the bank to sell those mortgage payments as investment securities fueling the housing boom, and That STUPID STIMULUS paid off all those investment securities the original loan worth then RAN and the homeowner is left hanging, where's their stimulus package?

Why is it rigth for the bank Appraiser to Inflate the house worth by $80,000, then the Current homeowner Increased the Price on MLS after the bank new appraisal, when I was purchasing the house.

The right thing to do was to Walk out of the deal.

Now why is it right to stop paying on your mortgage simply because the value dropped?

(Presumably/hopefully this isn't the reason but none was stated.)

Nobody forced anyone to pay for homes like that.

Most, if not all, of the 'mortgage" stories I see are people making less than $75,000.00 a year or less, and whining about being in a house that cost $450,000.00+.

Sorry - I have no sympathy for people that did that.

A number of people have lost their job and I can feel a lot of empathy for these folks.

BUt (there is always a but) many if not most of the people in trouble lived way over extended on credit. They bought houses they couldn't afford and then furnished them on credit cards to top it off.

[rebeccajo 14]

Not that ANYONE is advocating paying nothing as an option, but having interest rates on a loan based on the principle that the loan is on an asset that is appreciating as apposed to a depreciating one is quite scandalous because in this case it leads to destitution which is more costly on society than trying to keep people in the homes that they already have. Surely there is some way to re negotiate the loan based on current values with the option to re negotiate upward again if and when house prices go up?

Why should renegotiation occur at all unless there has been some change in the homeowner's circumstance?

If the homeowner has lost a job, then IMO in today's environment the banks should be working with the borrower for interest-only payments or some similar solution until the borrower has found new employment.

[SP&JM 0]

why is it right to pay the bank 3times the value of the house mortgage worth. Both banks and homeowners created that mess, Why is it right only the homeowner has to carry all the weight?

Why is it right for the bank to sell those mortgage payments as investment securities fueling the housing boom, and That STUPID STIMULUS paid off all those investment securities the original loan worth then RAN and the homeowner is left hanging, where's their stimulus package?

Why is it rigth for the bank Appraiser to Inflate the house worth by $80,000, then the Current homeowner Increased the Price on MLS after the bank new appraisal, when I was purchasing the house.

The right thing to do was to Walk out of the deal.

Now why is it right to stop paying on your mortgage simply because the value dropped?

(Presumably/hopefully this isn't the reason but none was stated.)

NOw lets assume the value of the house had "shot up"... and instead of your house value dropping.. it soared (as it did for so many people earlier).. would the bank then get to "renegotiate" the loan to get some of your profit or .... do you only expect the bank to share in your loss?

The very thing that you blame the bank for.... made both winners and losers depending on when you bought.

Nicely stated.

I'm paying the same amount of money for my car per month as I was 3 years ago, and it's worth a LOT less now. I borrowed the money (doesn't matter what for), I need to pay it back.

Does it seem to make sense for a bank to temporarily reduce interest rates to lower the monthly payment (especially considering the super low interest rate they're getting from the government) instead of having someone turn over the keys? Yes, I think so. Should they be obligated to reduce the principle? No. You borrowed it, you pay it. Besides, unless the bank lowers the principle significantly (around 50% as the OP is suggesting) it won't have much of an effect. The first years of a mortgage, all you're paying is interest anyway.

[Sylvia_n_Joseph 3]

Maybe I am old fashioned but when you took out a loan of X dollars at y% you ae commited to paying the amount that you signed up for. I think many people are not only trying to lower the interest rate but the principle as well. As long as I remeber people have been welcome to refience their loans with their original lender or any other one that wanted to offer a better rate. Usually if you folded the fees back into the principle you ended owing a bit more but would make it up in aying less. Stop whining and refiance if you don't like your payment. What most people want is to get out of being upside down. I kind of look at it almost like you hire an employee for say 30 K a year and then you find out they spend half their day online looking at forums instead of working you should jusgt be able to start paying them 15 K a year because their labor is worth less ?

[Hilarious Clinton 452]

Maybe I am old fashioned but when you took out a loan of X dollars at y% you ae commited to paying the amount that you signed up for. I think many people are not only trying to lower the interest rate but the principle as well. As long as I remeber people have been welcome to refience their loans with their original lender or any other one that wanted to offer a better rate. Usually if you folded the fees back into the principle you ended owing a bit more but would make it up in aying less. Stop whining and refiance if you don't like your payment. What most people want is to get out of being upside down. I kind of look at it almost like you hire an employee for say 30 K a year and then you find out they spend half their day online looking at forums instead of working you should jusgt be able to start paying them 15 K a year because their labor is worth less ?

You are 100% correct. People are either stupid or insane to think you can refinance because the value of the collateral went down.

Can I refinance my car every month based on this logic?

[MrsCat 6]

1) I bought a car and drove off the lot. My car suddenly depreciates 5%. I don't start paying 5% less on the note.

2) If I bought a house for $100,000 and now its worth $300,000, does that give the bank the right to request payment equivalent to $300,000.

People are trying to shift the risks and keep all the potential rewards. If only life were like that.