Should I stop making mortgage payments just to get help ...????

[Zippygirl]

Along with many of you out there, I am at the end of my rope.  I have a Pick-A-Pay Loan from Wachovia that due to a loss of income, the economy, etc ....I'm having a really really hard time managing.  However, I am STILL current -- not one late pay!  I've called Wachovia several time and there is no help to be had!  The Home Affordability Plan is not being offered by them yet ... and who know if and when it will be.

I've heard from almost everyone I know that the only way to get help or to even get the bank to listen is to stop making payments.

My dilemma is this ... I have a great FICO ... 790 ... which I worked hard for.  I don't want to let it go, but NOW, it seems that the only way to get help is to stop making payments.  Its not that I want to and this goes against everything I believe in and was taught, but I can't get any help.  Last month, I paid 1/2 by the due date and 1/2 before the end of the grace period, and between the two payments I got a nasty letter from Wachovia saying "You're late!" - which of course, I wasn't, technically, and all I wanted was to give them a nice little "F U" back, but ... anyway ...

so now what ...?  Do I stop paying?  Do I start a brief history of paying 1/2 and 1/2 and then only 1/2 before I stop paying at all, to at least show I'm making an effort?  I hear that if you only send in a partial payment they'll send it back ... apparently the banks really DON'T want the money or to help you!

OH, and I want to stay in my home ... walking away is the last thing I want to do.

Please ... any advice ... anyone??  I'm in California.

Thanks in advance!

Message Edited by Zippygirl on 09-04-2009 05:49 PM

Message Edited by Zippygirl on 09-04-2009 05:59 PM

[Anonymous]

The rule of thumb is that you can't have it both ways.  You can not get mortgage relief without some hit from it.  Also, if you get a modification, it will hurt your score anyways more than likely as they will report it as under modification.  The bottome line is most banks have too many people that are about to loose their homes to even really look at people who are still current.  Remember, even just 2 years ago, you would have had to prove serious problems such as a death of a wage earner or something to even get consideration for a loan mod.  There are some banks that have been more aggresive about loan mods, but neither Wachovia or Wells Fargo (who bought Wachovia when the FDIC closed it last year) are well known for good customer service.

The 1/2 pay thing means nothing to them.  They will automatically send you a payment reminder if your full payment is not recieved by the due date, but as long as you pay the full balance prior to it becoming 30 days late it will do nothing for your case but rack up late fees.  They will more than likley make you miss 2 payments before they take the loan modification seriously. 

[Lel]

Wachovia is currently listed as a particpating mortgage servicer on the Making Home Affordable website.  I would contact their loss mitigation department again and ask then again if you qualify for relief through this program.

People who have entered the trial period of the Home Affordable Modification plan have seen drops in the FICO scores due to a special comment code that is reported to the credit reporting agencies.  This is interpreted negatively by FICO scoring models.

One important question for you: do you have equity in your home?  I know many people in California, particularly those who have purchased in the last few years, have seen their equity evaporate.  If, however, you do have equity, then you have some options: you can try for the Home Affordable Refinance program, or if you have at least 20% equity, you could try a conventional refinance.  You could also sell your home, as distasteful as that may seem to you.  But if you can get out from under your mortgage without having to do a short sale, then you'd preserve your credit score and would be able to start from scratch sometime in the future.

[Zippygirl]

Thanks so much for taking time to give me your thoughts!

I've called Wachovia several times and have asked about the program and each time they say it's not being offered yet - that there's been a delay, or try back in 30 days, or ...

I am upside down.  I don't have any equity ... and from what I know, I qualify for the Making Home Affordable modification program ... but again... they continue to tell me that it's not available yet.  I even talked to a HUD-approved counselor through myFico's Mortgage Relief Online program ... but it didn't seem to help.

Any and all advice is appreciated.

Thanks.

[Anonymous]

The bottom line is that all of these programs are voluntary as far as the banks go.  Also, they can fully pick and choose who they want to offer the programs to.  Even though you do not have to be late and Wachovia is a participating bank, it does not mean that you meet the banks particualr guidelines on who they put through that program.  The compensation they get from the gov't to help you out is minimal verses keeping the loan as is (and you are still paying...

There is no magical help here for this.  It has to go through your bank.  You can pay one of the services out there to try to help, but they are going to charge you a ton and probably still make you go delinquent.  So, You just have to keep calling and if you really can not keep up the payments as they are, you may have to skip a payment to get some relief.  In the end stressing over your FICO score when you can't pay your bills is like worrying about car insurance when you can't drive.   Pointless.

If you can pay your bills, then you can't expect the bank to give you much help.

[Lel]

Be very, very careful about any company that says that it will help you obtain a loan modification for a fee.  The vast majority of them are scams.  At least one member of the FICO Forums was badly burned by one of these companies.  Any company that requires an upfront payment should be considered suspect.

You could try getting in contact with NACA.  They have been successful in negotiating loan modifications for many people, but their results are decidely mixed.

[Anonymous]

NACA has held several Save the Dream events during which they create a budget and determine what homeowners can actually afford,  you don't have to be behind.  NACA works directly with your servicer for free to lower your payments and/or interest rate permanently while at the event.  If you are unable to attend the event, you have to attend a NACA workshop and they will set up an appointment for you to bring your documentation (bank statements, mortgage statement, and a letter describing your hardship.  If you are more than 100 miles from an office, they can take your info over the phone.

I will say that Wells Fargo/Wachovia has proven to be the most difficult when lowering payments/interest.

It's worth a shot. 

[Lel]

You can also visit the LoanSafe.org forum, which is devoted to persons who are facing foreclosure or other hardships.  There are dozens of success stories over there, and plenty of stories related to people's NACA experiences, with probably an equal number of people reporting success as those who report frustration. 

It's possible to negotiate a loan modification outside the government's program and without the assistance of NACA, but it takes a lot of effort.  It can be done; I was able to negotiate a very favorable loan modification and about a dozen others who used the same approach were successful as well.

[Zippygirl]

Thank you AGAIN for your advice and help.  I'm sure I'm one of many that had no idea about NACA ... I have just been on their website and hope to attend a workshop!  (At least it's worth a try, right?)

As far as being able to modify without the help of NACA or other gov't programs ... can you give a quick run-down of what you had to do, who you contacted (what department), etc?  did you talk to just one person each time, or different people?  what specifically did you say or ask for that they would listen to you?  any tips are helpful, believe me!

Thank you all for taking the time to read my post and reply!

[Lel]

Zippygirl, just sent you a private message.