How do you get help with mortgage that is close to being default? We owe alot more than it appraises.?

We borrowed 125% in 2000 and have paid in over $80,000 on the 1st (borrowed $132,000)and $30,000 on the 2nd(borrowed $32,000) and owe more now as a pay off than we originally borrowed. I have since lost my job and so has my wife and we both are working for a lot less than we are accustomed to. We've had our home for sale since January and have had nothing but vultures asking about the house. (They want it for next to nothing and the banks would never accept such low offers) If banks can accept such low offers, How come they will not help us keep it by considering how much we have pd in over the yrs and reducing the amt owed so we can refinance for a lower monthly payment and afford to keep it? How can that be so unreasonable?How do you get help with mortgage that is close to being default? We owe alot more than it appraises.?
I am a mortgage broker in CA and am seeing this problem with many homeowners in my state. The most common solution I am seeing is whats called a ';short sale';. This is when the lender has determined that the borrower can no longer afford their home and is willing to sell the property at an amount lower than what you owe. Now, that doesn't mean you are totally off the hook but it is better to owe $20,000 than $100,000. If you wish to keep your home you may be able to contact your lender and try to get them to enter into a Forbearance Agreement. This basically means a lender will not take legal action against you, as long as you comply with a pre-arranged plan to get caught up.





One thing you must understand is that you entered into an agreement with a lender to pay back a sum of money that you borrowed. No one wins in this case. You might lose your house and the lender is going to lose a boat load of money, and the lender will also lose an investor. As far as why your bank doesn't want to help you, I am not sure. It may be that they do not believe you can recover and taking the property may be a better way of minimizing thier loss. Its kind of like winning the lottery. You can receive a big lump sum now or you can get much smaller payments over a much longer period of time. Just like winning the lottery, you recieve more money by waiting for the smaller payments over time but you can do a lot more with a large lump sum you can get now. That is what your bank may be thinking. Also by reducing the amount owed and letting you refinance, your bank will lose and that will be letting you off the hook and it just doesn't work that way. Your bank has investors, shareholders, and employees to answer to and they are in the business of making money, not losing it. The biggest reason might be the simplest. Your bank doesn't have to re-do your loan since you agreed to pay it back on the original terms. That may sound harse but its the truth. Many people do not realize what is happening when they buy a home. Many people know an $80,000 loan at 5.875% equals out to a payment of $473.23 a month on a 30 yr fixed mortgage. What most people don't realize is that the total of payments equals almost $142,000! Thats almost double what you borrowed in the first place. It is unfortunate that your situation has taken a turn for the worse and I hope you can find peace of mind at some point. There may be some hope though. Fannie Mae is urging lenders to redo loans so homeowners can keep thier property and some new loan options will be available soon. Be sure to consult with a reputable mortgage broker or real estate agent for options you may have since the real estate laws very from state to state. If things get really bad, a BK attorney may be an option also. Good luck and best wishes.How do you get help with mortgage that is close to being default? We owe alot more than it appraises.?
Have you actually talked to your banks? some insitutions will negotate a lower amount ( generally not that much ) unfortuantly they dont like to talk to you until its usually so delinquent, dont give up, have you considered moving to a home that cost less and renting your home ?
You are screwed, sorry Did you pay your fire insurance?





As a last dicth effort the week be be they take it make a lot of extra keys and give them out to the homeless, do not tell them, they will love you for that and so will the neighborhood.