Scared, huh?? a revolution is about to happen and everyone who did the"right" thing will be put to the back of the line. it's indeed unfortunate, but life isnt fair.
Exactly, the local governments will simply amend the equation or the assessed value to keep property taxes the same or increase them. Granted, I will concede there are some states who do play fair and do what is right, but many other states are filled with know nothing, fat fuck bureaucrats who can't stand to cut back and need to feed their bloated pensions and reckless spending with increasing property tax revenue. Alot of people are waking up to the fact that you never really own your residence, you simply rent it from the "state" even after you pay off your bank note.
Against my better judgment as I used to work in banking before trading letâs look at this âvictimâ story and show what is really going on. As usual, victims distort facts to make them feel like things are not their own fault (sorry, but true). So in the interest of general knowledge here goes: I will try to keep this brief but this is a complicated process. Mr BartS says: Some of these banks are asking to get those homes shoved up their ass big time.I will actually share my story, as i am a homeowner facing foreclosure (non strategic default - business took a shit) and have been basically dicked around by Morgan Stanley (or Saxon mortgage Services - an sub of MS)..... Before things went really bad - called them up, explained the situation - and was instructed that inquiries for a refi would only be considered if there was delinquency on the account by more than 60 days. Fine. Stopped paying - then THEY started calling. Submitted all the paperwork for refi. Nope - don't qualify. OK then - fuck this, not paying them a red dime.... ~The first thing you need to figure out is whether MS (subserviced by Saxon) owns this loan or is the master servicer. Chances are MS services this loan for FHLMC, FNMA or FHA as they are the three largest owners of mortgage paper. This matters as every investor has their own sets of guidelines they follow (of which the servicer has no leeway in ignoring). In the unlikely event that MS actually owns the paper, they can do what they want with it but still have internal guidelines they would follow. Edit-I see at the bottom it is or you suspect is owned by FHLMC. In the first paragraph it is specifically stated this is a non-strategic default. Then when you knew you were heading for trouble you called them up and explained the situation (a good thing on your part). But just because you want help doesnât mean you will get it or more importantly, qualify for it. First your terminology is way off. No bank anywhere would do a refi on anyone if they were past due on their current mortgage (or at least at terms you would want). To qualify for a refi, you have to be current to be considered (before you stopped making payments). That was your only chance at a refi and you may not have qualified based on your reduced income. You would have to show continued affordability of the property which isnât a given if your income has been reduced. What you are most likely referring too is you want to do a modification of your loan (that is not the same thing as a refi). Mods are for people who are delinquent. Now before a couple of years ago, you could not do a mod if you were current (although this has changed now as FHLMC allows mods on current loans under very specific situations some old buddies tell me, donât get me started). You give the impression your foreclosure is occurring presently so what applies to this specific situation depends on when this foreclosure took place). Keep in mind no bank is going to flat out tell you to stop making the payments. All employees are told specifically not to recommend that so the likelihood of this happening is very remote. They may say something like our guidelines do not allow us to do a MOD (not a refi) on a current borrower. Now you may take this anyway you want but they are not telling you to stop paying. You either heard what you wanted to or didnât pay close enough of attention here (as I obviously wasnât there) but they are very careful about saying stop paying directly. Now you stop paying because you want a mod (NOT a refi). How again is that not a strategic default? You can make the payments for now at least but you stop making them on purpose. â¦They start calling because you are delinquent. Of course they call you. They want the mortgage payment. You apply for a mod or a workout package (not a refi). You donât qualify for a potential workout for an assortment of reasons (which donât matter as they are following the guidelines they have to qualify you with, not making things up as they go along) most likely your income is lowered by enough that you actually canât afford to remain in the property based on your current income/expense situation. That is a risk you take if strategically defaulting (sorry, forgot you still think you didnât do that). Now since they wonât do a mod or another workout option (not a refi) because your current income/expense situation shows you canât afford it, YOU stop making the payments forever to âshow them and screw themâ not realizing you are only sealing your own fate. No you are so far behind and/or you income is not high enough to afford retaining the home and they decide your only option is liquidation (i.e. short sale or Deed in Lieu). Property is listed with a realtor (has to be listed for so long depending on the investor before they will consider the short sale (used to be 3 months for FHA but again these things can and do change). No buyers come forward for months and you get your three offers. I will grant you that the short sale process is slow. But blame the investors as they make the rules. You now said 3 offers came in. 1st offer was a dud - no approval - gone. 2nd offer - good to go - bank countered, gave buyers 3 business days to decide - no answer - file thrown away. 3rd buyer - decided they wanted to haggle after inspection - file thrown away. Buyer 2 came back with offer matching the bank's counter on sept 4. Bank received files the same day - and went forward with sheriff's auction sale on sept 7. ~No info given about how long this has taken but first offer refused (probably because some moron make a lowball offer they learned about on late night TV). Again, the amount the bank takes is determined entirely by the guidelines set by the investor (FHLMC used to need to net 91% of BPO value, not sure if that is still correct). If a potential buyer will not pay what the bank needs to net, no short sale happens. Again, buying with a short sale is a pain in the but. It takes a lot of time and playing games only reduces the likihood of closing the short sale as again, they are following strict guidelines. Many donât close because buyers lose patience and move on to other properties. That stinks if you are trying to do one from either side of the fence. 2nd offer bank counters, seller decides not to pursue the new requirements. Bank canât make buyer accept the terms the investor is willing to take. 3rd buyer. Again, wants to play games which doesnât work (99.9% of the time). The whole time you are not paying and they are pursuing foreclosure. The truth is they canât take a payment or would have to start the foreclosure process over again and restart the process (which process is determined by your state). No short sale offer puts a foreclosure on hold until they have a fully executed sales contract. Period. 2nd buyer comes back (however much later it may have been) with a new file (but probably no sales contract or not agreeing to what the previous counter was, trying to play hardball again the day of the sale) and you wonder why they didnât stop the sale? Would you if you owned the loan? If they have a new offer from a previous potential buyer that met previous requirements with no contingencies and proof of funds, they probably would have stopped the sale (but again, they are under no obligation to do so) as they would want the money. But my guess is that is not what they had.Some sales are early in the day so waiting to the last morning of the sale date to resubmit an offer or package has a very low probability of success. You are on your own with redemptions as I donât have much knowledge of those. This is the process of what is really going on. And it is probably hard to stomach for BartS, which I completely understand. But calling it a conspiracy because playing games with your mortgage didnât pan out for you (it does for some) is I am sorry to say typical of those who try to game the system and lose. But this is probably a reasonable estimation of what is really happening (or a small part of it) at the bank. Good trading all. I have a headache now writing that and that is the very short version. The whole short sale and loss mitigation game is very complicated as I am sure you can imagine from the above brief look. BM
Thanks for your lengthy and intelligent reply. I would like to reassess that this was definitely not a "strategic" default...Did I anticipate the problem - yes - did I call early - yes. Did I do it in order to screw them - not at all - I actually like my house a lot - and would have done whatever possible to work out a deal with the lender to remain in it - but if you spend months upon months banging your head against a concrete wall, you eventually will walk away with a headache... The problem actually unfolded as expected (well, actually far worse) and there was not enough to pay for everything. Nothing was done (interestingly enough two months after defaulting the lender - TBW - was shut down by the feds because of fraud and the mortgage was taken over by Saxon)....I do understand that some of the programs are there just to there and serve essentially no purpose - as qualifying for them is essentially impossible. (The administration actually created a program to assist homeowners, however the one key requirement was that the house had to be in a non depreciating area - who are you kidding??) The situation is pretty bad - and honestly I am not so much upset about the foreclosure itself (it is what it is and at the moment there is nothing I can change about it) - what really irks me is the inability of this lender to get anything done.... I mean they will eat the property anyway - what is another month or two if they have an opportunity to walk away with another 90K??? I am still trying to push for a short sale, at least for the sake of the buyer that has been around since july and really wants the property. Probably doing far more than any homeowner with really nothing to lose would do - trying to get through to the CEO of Saxon via his assistant, calling Freddie Mac and insisting they get in touch with Saxon to get things clarified (which they will do actually).... In the end, I will end up with a deficiency and will file chapter 7 - no matter what happens - I paid the difference and then some in interest over the last few years.... and lost over $150K in cash money that I could have saved up right now between interest, cash invested in the property for remodeling etc. The bank technically takes a flat, and still will have the option to pursue the deficiency. Like I said before, I was able to afford the property very comfortably when I purchased it and for a few years paid on time - no issues. If anyone asks me about the mortgage industry: FUCK THEM will be my answer. Think about it - I played by the rules - everyone made money - and I end up holding the bag.... Yeah, fuck them.