Need Opinions from those who have been there - Mortgage Late, Bank wants money.

**bumplett** · 09-20-2010, 11:00 AM

ok - I have my own opinion, but I'd like to hear as many others as possible ~

senerio:

My cousin (in-law) lives in a smallish town, 20+ miles outside a major city - having a hard time finding a decent paying job but is currently employed @ $8.50/hr (40 hr week) - Has also been searching for a better job for at least 3 months, and pays for one child in daycare.

cousin (in-law)'s spouse is currently employed (and highly educated in the field in which they work) in a profession that pays flat rate (meaning only gets paid when there's work) ($24.85/hr when there's work) This is the type of business that has been hit hard with a crappy economy.

Example of income: $400 - $600 per week total. (spouse recently cancelled medical insurance for the family due to not making enough money to survive, so this should give an extra $150/week starting next week)

Mortgage is $1448 per month

Currently, mortgage is past due $4344 (3 months) but cousin (in law) will pay $1500 on this Friday making the new balance of:

Mortgage is past due $2897 (2 months)

Bank sent letter stating that they must agree to a repayment plan that consists of reg. mort. payments PLUS additional $287 per month. If aggreement isn't kept up, or is late, full amount past due will be due in full.

Cousin (in law) has been sending as much as possible weekly for the past 5 months or more, but is consistantly a month behind despite their best efforts.

Bank told them this morning, they can't continue to go on paying whatever they can, and they need to sign the agreement.

Everything they can sell has been sold. Aside from selling a kidney, or a kid, there's nothing else to bring in extra at this time -

sooooo - MY question is

"what is your opinion on signing that agreement with the bank???"

The way it was posed to them, they don't have much choice, so the cousin (in law) wants to know - can the bank MAKE them sign it?

I vote: continue what they are doing, and every little bit they can send, send, but DON"T sign anything!

what say you?

**Greebo** · 09-20-2010, 11:06 AM

Originally Posted by bumplett

Bank sent letter stating that they must agree to a repayment plan that consists of reg. mort. payments PLUS additional $287 per month. If aggreement isn't kept up, or is late, full amount past due will be due in full.

Gee how generous.

Cousin (in law) has been sending as much as possible weekly for the past 5 months or more, but is consistantly a month behind despite their best efforts.

Bank told them this morning, they can't continue to go on paying whatever they can, and they need to sign the agreement.

If you sign an agreement when you know you cannot live up to that agreement, you're signing in bad faith. Bad idea. Never agree to do something you know you can't or even DOUBT that you can do.

"what is your opinion on signing that agreement with the bank???"

Absolutely not.

The way it was posed to them, they don't have much choice, so the cousin (in law) wants to know - can the bank MAKE them sign it?

No. They can lose the house. They'll lose the house either way. Agreeing to a plan they can't actually execute won't change that.

I vote: continue what they are doing, and every little bit they can send, send, but DON"T sign anything!

what say you?

Agreed.

**bumplett** · 09-20-2010, 11:14 AM

Thanks Greebo ~ I agree with your comment about signing in bad faith.

**bumplett** · 09-21-2010, 09:18 AM

wow, I'm a little (or more) disappointed that noone else shared an opinion. (yet 100 views?)

Cousin (in law) had wanted me to read all of the responses so that they could get a feel of how others have dealt with or would deal with this type of situation.

oh well.

they are looking into filing bankruptcy anyway. (which in my opinion isn't going to help)

**Russ** · 09-21-2010, 09:27 AM

I read and would have responded as Greebo has. Let's face it, what other way can they go? The bank cares about 1 thing, their money.

**Greebo** · 09-21-2010, 09:49 AM

Bankruptcy is a dumber option. Instead of getting shot in the gut now they're opting to get shot in the spine.

Not only will it not save the house, but it's WORSE on their credit record than a foreclosure, short sale or deed in lieu. It has much longer lasting repercussions (life long) and lying about having been through a bankruptcy (a standard question on loans and job applications) is fraud.

**lparker** · 09-21-2010, 09:59 AM

I'd walk away if I didn't have much equity. There doesn't seem to be much chance they'll get caught up before foreclosure and no guarantee there won't be a foreclosure if they do pay up.

**a.nonymous** · 09-21-2010, 10:15 AM

Originally Posted by bumplett

wow, I'm a little (or more) disappointed that noone else shared an opinion. (yet 100 views?)

The lack of replies may be because of the title addressing "those who have been there".

I haven't been there, but declaring bankruptcy should never be an option willingly chosen, but an action you have been forced into by your creditors.

**Mom2-3** · 09-21-2010, 10:31 AM

Originally Posted by a.nonymous

The lack of replies may be because of the title addressing "those who have been there".

Yes, this is the reason I did not reply. Never been in that situation, hopefully never will. Good luck to your family.

**Mojjo** · 09-21-2010, 10:54 AM

I haven't been in the situation, but if they have no chance of ever catching up...they should walk away. Give the house back to the bank and find a place to rent. I wouldn't sign anything in bad faith.

Other than the house, do they need to file bankruptcy? I mean, if the mortgage wasn't an issue, could they pay their other bills?

**McD** · 09-21-2010, 12:36 PM

Originally Posted by a.nonymous

The lack of replies may be because of the title addressing "those who have been there".

Exactly. I haven't replied because I have no basis on which to offer sound advice. I am, however, interested in the advice given so I can educate myself.

**Josephhgoins** · 09-21-2010, 01:33 PM

I think the reason that most didn't reply, is that Greebo summed up what everyone else was thinking.

I have got to say this. Even in the best of times $24 an hour isn't huge money for a 40 hour week when you have a $1600 a month mortgage and kids. I think they bought more house than they can afford. If it was me, I would get out of the house as quickly as I could. It’s only going to drag them down further.

I don't want to sound mean, but their situation seems pretty glum. If the one making 8.5 pays every penny of take home to the mortgage they are still about 600 short of a full payment at the end of the month. They are losing more and more ground every month.

My mom ran into a similar problem and was connected with the Loss Mitigation department at the bank. They worked out a new payment plan with smaller payments and lower interest rate. Of course there was a few thousand in bank fees that had to be paid in cash up front, but they were able to keep the house.

Other than that, my suggestion is prayer.

**Dancing Lotus** · 09-21-2010, 03:43 PM

If I were you cousin I would just let it go. OH wait I am your cousin, well sorta. We are in a similar situation and I too am having a hard time accepting what I know needs to be done.

I'm sorry but your cousin has no options, he simply can not afford to pay for that house. He should just stop paying and wait to be evicted. I know it feels awful and it's not going to be easy but in the long run I think he will find living within his means to be a far better option.

I'm fairly certain that this is what we are going to do.

**Missy** · 09-21-2010, 04:15 PM

Originally Posted by Russ

I read and would have responded as Greebo has. Let's face it, what other way can they go? The bank cares about 1 thing, their money.

i was thinking the same.

**Missy** · 09-21-2010, 04:19 PM

could they get caught up, through dumping all they can into the mortgage, asking family etc, to get caught up, then file for a mortgage adjustment/modification? just an idea