To all of my readers, I have nothing but the deepest sympathy and
compassion for the one million American families who have lost their
homes due to foreclosure. This crisis has affected millions of American
people. Six million more of us could face foreclosure as loans reset
and interest rates creep up over the next two years.
Three
months ago Elena and I went out bravely to refinance our home. We have
a subprime loan from Country Wide Home Loans. We went first to them.
They urged us to refinance immediately despite the fact that we would
have had to pay a $23,000 prepayment penalty. They loaded our credit
files with all sorts of inquiries. They came up with no solutions.
House
Speaker Nancy Pelosi and the late Congressman Tom Lantos (Bless their
hearts) got the Federal Housing Administration to raise their loan
limits from $417,000 to $729,000. We could now go out and get a
government guarantee to get our home refinanced.
My wife has
credit scores of over 700. She has been a doctor for 24 years. Our
family income is in the top 3% of the US and in the top 1% of world's
income. By the way, we earned that by some incredible hard work and
sacrifices. We thought it would be an easy matter to get a new loan.
I
hit the internet to find a lender with FHA specialization. None
appeared in California. Two FHA specialist firms appeared on the East
Coast. I interviewed both of these companies and chose National Future
Mortgage,Inc. in New Jersey.
We went to work in earnest. The
first challenge was an appraisal. Property values have dropped as a
result of the bad real estate market. City Wide Appraiser appraised the
house. They did a really professional job. We got a value that
reflected a decline in the market but was fair,rigorous and
professional.
We then had to submit a ton of papers for the FHA
to look at including W-2's,bank statements, etc. Our CPA allows us to
file separately and allocates income. Therefore my wife's W-2 does not
match her tax return data. FHA could still turn us down for this reason.
Our
second challenge was the second lien we have on the house with Wells
Fargo Bank. Real Estate and loan brokers warned me that they were very
tough and blocked many refinance deals. I am a man who refuses to take
no for an answer. I did a lot of research and located their Loan
Subordination Department. Much to my surprise the manager of the
department called me and was most helpful.
In these bad times,
Wells Fargo still generates a profit for their share holders. They are
making a lot of real estate loans. They survive because they try to
look at each customer as an individual.
Their staff and managers are
a group of ladies and gentlemen and professionals. They still could
demand that we pay an additional $50,000 to lower our loan to value
ratio. I think they will be more reasonable.
When I got out of
the US Navy 35 years ago, I started my career helping people to get
mortgage loans. I know how to prepare professional presentations. I
know lenders. I do not quit when I have a problem with an 800 number
that does not work or gives a bad answer.
My wife and I are in a
household with two post graduate degrees and an incredible income. We
know the finance industry. What worries me is all the average people
out there with just a high school education and a family income of
$50,000 to $75,000 per year. What hope do they have of navigating through all of these obstacles to avoid foreclosure????????????????????
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Posted By ohomen171 to OHOMEN171 at 5/11/2008 03:58:00 PM
Life takes us in many strange directions and wonderful discoveries. It never turns out the way we thought it would.
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