my mother and i purchased a home about 3 years ago in the peak of the real estate boom. Intially we put down 100k from the 500k purchase. The payments are 3k per month on a 15 year mortgage. Then, for the first year we over paid 700 per month. Then went back to the normal payment of 3k per month. Half of the homes in the developement (about 30 total) are either in or were in forclosure. some of those forclosed homes (my neighbors) sold at 180k. i keep saying to myself, what a GREAT investment i made (joking of course). we are still to date about 100k upside down. I have tried to work with the bank (B of A) for a few weeks now but have had no success at all. These people at the bank claim they want to help but they don't and I now believe that they don't care at all. I have asked to restructure to the 4.25% (they originally offered when they did not have all the information) rate which would help and make the payment about 700 a month less. I have asked about the make homes affordable plan which they claim I was 2 days late a year ago with my payment which disqualifies me. I have asked to extend the term to 30 years and adjust the interest so i can continue to pay and stay in good terms. The bottom line is that no one will help and all they do is give you another number with another rep who does nothing. Well 30 or so hours of trying to do this with the bank and i am done with them. I am considering and think i should focus on short sale options so i can hopefully keep my credit in tact, that is if that is possible. Oh, a major problem is that my mother has a good job and her tax return will not show a hardship and will show her ability to pay. HOwever, she has health issues now at her past retirement age and she wants nothing to do with the property at all. My income, on the other hand, will show a serious hard ship-- a whole 24k last year in income as i own my own business and things are very bad. What do i do, what do you recommend? I keep telling myself to just stop paying and that will get their attention and take this seriously. I don't want to wreck my credit which i have worked so hard to maintain and i especially don't want to hurt my mother when she was just trying to help me obtain the house in the first place. last but not least, i don't want to do wrong and if possible keeping the property would be a plus. thank you
Is this a rental property or what? You said second home. I assume that's why some of the programs aren't available. If it's a rental, how does the income compare to the mortgage? This is a good example of why you should never pay extra on your mortgage. You should have put that money into a relatively safe investment and now you could use it to help you get through the hard times. A lot of people may disagree with me, but I like the advice of Ric Edelman. He's been rated the number one independent financial advisor in the country by Barron's. He says you should carry a 30-year mortgage and never pay it off. Read his article here. I know it's too late for you to do this, but I think it's worthwhile advice to help people be able to get through economic downturns and personal downturns.
Personally, I would advise you to let it go and try and attack the tradeline thereafter. You're simply throwing money away on top of what you've already lost. This is a business decision.
