Mortgage Loans

[weathergirl77]

I am now totally disabled and make 40% less income.  I already have spoken to the Chase Mod Department and they have been actually really helpful and did say I quailify for a modification and sent out an application.  What I don't understand is how they figure for my case how much the monthly payments would decrease.  My mortgage with taxes is $520 and the monthly HOA is $153 but I pay it seperate, is not included in the mortgage payment.  My gross monthy income is $1339.  I went to a site that has a mod calculator and below is the result.  My question is because the HOA fee in not included in the mortgage how can the monthly payment be reduced to $415?  Does anyone know how this works?  I called Chase a few times and they said the underwriters handle this and could not answer my question.  They said that I would more than likely get a 2% reduction in my interest rate (which is now 5.5%) and a reduction in prinicpal because of my severe hardship.  It will take a little while to find out for the final outcome but I need to know now how this is figured.  I am doing everything I can to not become homeless and need to know how this is figured with the HOA being paid outside the mortgage.  I want to be able to sleep at night.

Thank you for taking the time to read this.

his is Your Current Debt-to-Income (DTI) Level	50%
Target DTI under the Home Affordable Modification	31%
Potential New Monthly Payment If You Qualify	$ 415
Potential Monthly Payment Reduction If You Qualify	$ 259

[Kozmo]

Depends what loan mod It is. If its HAMP then the HOA's are tied into the new payment. Lenders want your target mortgage PiTI+HOA's at 31% of your gross income. Now keep in mind that because you are on fixed income and do not pay taxes they will likely say your gross income is higher (sucks I know). But that's industry standard. They adjust your income upward to accommodate for this. So that payment they are quoting you at is probably lower than what it will really be.

However, Chase also has its own version of HAMP called "CHAMP". Not sure exactly how it's calculated but I'm sure it's almost the same. Just without the government qualifications.

I would say you will still benefit with a lower payment but I wouldn't go off of that chart you posted. As it also does not factor in principal reduction if they actually offer it (very hard to come by). I know they "told" you that you likely qualify, but trust me I wouldn't take any word for it without seeing it in writing. Nothing is guaranteed until you get through the trial modification period of 3 months and sign the paperwork.

Hope this helps.

[weathergirl77]

Thank you for your reply Kozmo.  Actually I do pay taxes on my income as for now it is long term disability and my monthly gross income is $1,339.  I had a long talk when I initially talked with Chase which my therapist called for me to state my situation.  I was told I would qualify for a 2% interest rate and principal reduction.  I sent the paper work in on December 23.  But my biggest question is if they include the HOA fee in, how does that work because I pay it myself.  Chase already pays my property taxes with  escrow.