Ahhhhhh!! We Can't Refinance Our 1st Mortgage :(
Yep, not even my beloved USAA can save us from this one. Apparently we're TOO under water to refinance. Since when is $60k in the negative TOO much? ;) haha...ah well, it was worth a shot.But what's really frustrating, if you'll allow me to say so, is the fact that there are, indeed, people who can/will be able to refi because they made some huge boo-boos.
That's great for them, and certainly for our economy in general, but what about the others who behaved and played by the rules? Shouldn't WE be granted some help as well considering we also took it up the a$$? This affects more than the people who helped us get in this mess to begin with. (emphasis on *helped* here as we all know there were many other factors stirring the pot.)
The Mrs. and I aren't perfect little badgers, but we should still be granted some sort of equal rights. We pay our mortgage on time, we didn't get too over our heads, and we were responsible. Shouldn't that count for something? Are we being greedy here? Whatever....I'll go ahead and stop now. I'm sure everyone's tired of hearing about this stuff. I just had to get it out since it's directly affecting us now.
I'm just hoping Mr. Obama has something good up his sleeves...
Labels: crazy economy, home ownership, mortgages, rant, USAA
posted by J. Money at
7:16 AM
41 Comments:
You know I was thinking something very similar but about my student loans...I pay them on time. I don't complain too much. Sallie Mae steals pieces of my soul every two weeks. Instead of bailing out people who screwed up (yeah this is about to get really selfish so bear with me...) why not bail out us students who took out loans so we could finish our education...
I could do some serious economic stimulation with an extra $500 a month NOT going to sallie mae...
Just saying... :)
Ah, I feel for ya, J. I really haven't paid attention to the whole recent mortgage assistance plan by the gubment, but I thought I read somewhere that you didn't have to be underwater to benefit. (I guess your loan has to be owned by Freddie or Fannie to participate.) Do you know if your loan is owned by Freddie or Fannie?
And, "Amen!" Brandi.
And I thought that I would not be able to refi because my loan was not at even 3% now but I am not quite underwater. I am on a raft barely floating above the water line I think. I guess I should check with my credit union and see what the fees would be and if it is possible to refi the loan to drop 1% off my loan. Time to break out the bad ass calculator (excel) and check what would happen.
I would love if they did something about our student loans but I know that it gave me such a huge boost that I will pay it because it is more than paying for itself. Now if the interest were still tax deductible that would be nice, or if I waited to buy a house and got some of the gov't money or lived where the new vehicle tax made a difference. Oh well, I will deal with it and just keep my job and take care of it on my own.
Yes Brandi but I don't think J is looking to be bailed out in terms of lowering his balance, he just wants the chance to refi. I take it you are talking loan forgiveness on your student loans. You are free to refinance or consolidate those student loans, that is all J is looking for.
J I'm in the same boat as you hon, and at least as underwater as you. I have an ARM, I just want to refi to a fixed rate. I don't think it's going to get bad enough to help you or I, we need lenders to embrace no-appraisal refinances for loans they already hold. They wouldn't be changing their risk since they already hold the note. Alas most aren't imaginative enough to realize the benefits. We're pretty much screwed :(
Welcome to the world we are at! Bailouts, handouts, and more bailouts, I am so sorry to hear this and it just makes me loose faith in the system. I have been following your blog for some time I have havent heard you complain much about your mortgage being under water. When will we wake up and not reward people making mistakes, or business failing? It is ok for people who cannot pay their mortgage to lose their house...why?, well because we have a great system for people who cannot afford a house like myself, its called RENTING! Why do we remain to give incentives to people who make bad decision and give nothing to people who right decisions, like saving money?
Sorry I will quit my ranting...I just see how well the Mrs. and you are doing and instead of helping out someone that has been smart about there money, they give it to people that will eventually probably end up going belly up anyways because of their financial situation!!!
MY head is spinning now!
Sorry to hear J... hang in there. I bet Obama does have something up his sleeve. Now that the white house dog has been selected, he can spend his energy on this stuff. ;^)
I know the feeling J! My condo is under water and it SUCKS that I cant refi when I have been paying my bills on time. I bought a place that my bf and I could afford. I get SO pissed when I see people on Dateline who have a $1Million in real estate when they're making below minimum wage. These yahoos are getting a hand to modify their loans and we have no choices. BULLSHIT seriously!!!! Urgh, I hope things improve in the near future but Im not holding my breath....
Ok, Im taking a deep breath, taking a giant swig off coffee and trying to get some work done....
Hell to the yes! I completely agree. I couldn't refinance either and take advantage of the lower rates, mostly because I got a mortgage I could afford in the first place. Hopefully we will get some karmic payback.
@Jane - Karmic payback! I love it!!!!
If I had a house that was underwater I would be sad. That's about all I can contribute to this conversational piece because I'm a renter.
When did you buy your place? If you bought between April 9, 2008 and January 1, 2009 may be eligible for a federal tax credit of up to $7,500.
Sadly, I bought before this. =(
Before I respond to y'all, I just wanted to share an incredibly written piece from someone who could be considered one of "these people" who bought a house they couldn't afford and are now dealing with it. It's stuck in my head for quite some time (even when writing today's post) so i thought i'd share it so you can get the other side's perspective :)
Dawn is an incredible woman who blogs at Fighting Foreclosure, and it's worth a read if you have some extra time (it's kinda long). Here's the link, as well as a quote that sorta sums it up a bit: Why I Bought a House I Couldn't Afford"I won't deny that there are people out there who made bad choices, but I will say that there are a lot of people who were doing what they thought was the right thing - before it all went wrong. I was almost one of them. Frankly, I still could be. That is why this blog is called "Fighting Foreclosure."
@Brandi - Yeah Sallie Mae! Give my girl her soul back ;)
@Shtinkykat - As stupid as it sounds, i have no idea if Freddie or Fannie have a piece of my action....I pay Chase Financial every month, so unless the F's are behind the scenes owning it, i don't think i'm one of the lucky ones to be helped out. I'd definitely feel better as long as *someone* is getting helped though! my goodness.
@Philip - I bet you'd be okay if you tried to refi now before/if it gets worse, esp if you hit up your credit union. I could have sworn USAA told me the other month that i could refi but it would just be at a higher % rate, but i guess the chick wasn't paying attention all that much. Or things just changed a lot. And I agree - tax deductible interest on those student loans would be awesome! I actually thought that was already going on?
@MIss M - Yes, you got it - All we wanna be able to do is refinance into a lower % rate, that's it. I have every intention of paying off our loans 100% over time, but I think you're right in that we're not drastically in trouble enough to get assistance. Unless we start missing payments on purpose and can creatively show we're in dire need (which i would NEVER advise fyi), we just have to suck it up for now. and blog about it ;)
@Atlas@mymoneyshrugged - Thanks for the kinds words my friend, always appreciate that...nothing much to add on top of what you already said except that we as a nation will hopefully learn from this mess and come out stronger, and smarter, than ever!
@Nicole - haha...indeed.
@Frugal Fundamentals - Yes, down that coffee and rock that work girl! There's def. some craziness in the air...
@Jane - If you figure out a way to get some, you better holler :)
@Punch Debt In The Face - well, nicely said anyways my friend. and at least that's a wonderful pro about the market - you can pick up cheap a$$ homes (not to be confused with "holmes" which i accidentally typed at first) if you wanted to! perfect for 1st time home buyers :)
@Asgreen - Sexy! But we're like you - bought way before then as well. Thx for sharing though!
Ah yes, I'm also with my beloved USAA. But am now wondering if they'll still consider refinancing if you're not in the negative? I'd like to think so, as I've been planning on calling them to get a better rate. My credit score is good, house is still in plus value, always pay on time, etc. Hubby keeps joking that maybe we should just stop paying the mortgage for about 3-4 months so we can qualify for some outrageously low rate. *sigh*
Being responsible certainly hasn't been paying off as of late...
I know the feeling J. We are trying to re-fi our stupid loan we got a few years ago. We got a stupid interest only loan when we bought our place. STUPID!!! We were hoping for an easy loan modification but we didn't qualify.
We didn't go overboard either, and we have paid our mortgage on time every month for over two years. I guess you have to be irresponsible and default on your loan these days to get help.
The only problem for us now is that we haven't paid on the principle at all so we have very little room to wiggle in order to make it a smooth transition. It's a really good thing that we got a $15,000 discount when we bought it. Otherwise we would be upside down on our mortgage just like most people are on their cars.
I tried to refinance on my house a few years ago when the rates were at about 4% -(Mine is fixed at 7% which was fine in 1998) - and the banks wouldn't refinance me because I didn't OWE enough on my house... meaning they would refinance me if I wanted to take out equity.
I am so happy I didn't do it.
I hope you guys can come up with some kind of solution to the problem. Unfortunately, I don't think waiting for Mr. Obama to solve it is going to work...
Yep, a lot of us are in the same boat. While I can refinance (at least I THINK I can, appraisal is this Friday), I'm sorry that I paid as much for my house as I did. Two years ago, I thought we would be priced out of our neighborhood in no time--we felt pressured to buy before the opportunity was gone. Every house we liked had an offer above asking price within a couple of days. It was crazy! When we bought our house, I thought we'd made a very smart financial decision. Of course, if we'd waited, we could have bought a nicer house in a safer neighborhood with an $8,000 tax credit! Our friends are taking advantage of the market and the first-time homebuyer credits--the real estate agents are even pitching in money for closing costs! I can't help but feel jealous.
But oh well, such is life, hindsight is 20/20, and all that. Ugh.
You people really need to stop whining. I was smart enough to not buy a house three years ago when anyone with a pulse could get a mortgage. Why weren't you?
@StaceyO - Your husband wouldn't be the first one to consider that! i know someone who did it, got refinanced, and paid no closing costs, but no way in hell i'd ever recommend that....a) you need big balls, b) willing to lose your morals (in my opinion) and c) have big balls ;) I think USAA would let you refi if you're close to the water line, and ESP if you have equity! much better way to go ;)
@Enemy of Debt - Do you feel that it is STUPID? haha....totally feel your pain my friend. Keep on being thankful for that credit and that you're still hanging in there! we got $10k in credit as well as a lot of other great stuff, but it's all about the timing really.
@Pauper Princess - wow, really?! that is so crazy to hear these days :) but yes, good for you in not getting into the mess!
@Fit Wallet - I was actually a realtor right at the peak of all this stuff and you're totally right - i'd get 10+ offers coming in for $50-$150k over asking price! people were nuts. but i hear ya on trying to pick up a good house before it's too late - we did the same 2 years ago :) just glad we didn't pick up a craphole cuz that would have REALLY sucked. Good luck on friday!!!! hope it all works out perfectly.
@Anonymous - because we're not as perfect as you i guess. maybe if you left us your name we could tell you how proud we are of you?
I am unfortunately uneducated in this area. What benefit would it serve to refinance the mortgage?
BTW - We are new to this PF blogging scene, but I just wanted to let you know that we added you to the "Blogs We Follow" line. Just disclosure or whatever.
I would love to tell anonymous how proud I am of him/her. What a jacka$$.
J,
You are not Obama's friend your fam is middle class who hasn't totally F-ed up their life (whether it is through home costs or consumer debt). Instead as you become more successful you will have the HONOR of paying more taxes to support those that have.
/end Republican Rant
I tried to call up HSBC (the mortgage company) and threatened to REFI if they wouldn't just do the cheaper loan modification for a lower APR. Got denied QUICKLY, but you may have better luck. Try it out
Well, there is the option of doing a full-blown appraisal. That'll cost you a pretty penny I'm sure, but it may give you the option that you're looking for. The other option is to see if Chase will do a modification agreement to lower your rate. I used to work for Chase - no mortgage, mind you - but when I was there, they did consider modification agreements. It's worth a shot, especially if USAA can't help you.
@ Anonymous...wow, that was harsh. Most of the people here aren't even talking about houses they can't afford. They're talking refi's to lower the rate. Why shouldn't they want to take advantage of that? I understand your frustration, but it's directed at the wrong group!
Do you not qualify for Obama's refi option? http://makinghomeaffordable.gov/
Anonymous here. My comments are directed at exactly the right group. That prices were inflated beyond all reason was obvious at the time (and still is), so people whining about not being able to refi because they're underwater should accept some responsibility for a poor decision to buy at the height of the market. Don't even get me started on people who bought houses they could only "afford" through creative and irresponsible loan terms.
The foolish should not be bailed out by further irresponsible refinancing. The criminal and outright stupid should end up in tents.
Ugh! Frustrating, I'm sorry to hear that it didn't work out for y'all. =/
@Anonymous: It sounds like J's not the whiner here. I agree that you shouldn't buy something you can't afford, but there's nothing wrong with at least trying to get a good deal if there's a chance to get one. And I don't know the specifics of his home, but if you read the rest of this blog, I'm pretty sure that he wouldn't just buy something without having charts, graphs, and all the sexy stats to back him up.
@Anonymous While housing price may have seemed inflated to you, not all areas saw huge jumps in prices. If you were a first time home buyer and all you knew were the current prices in your area you wouldn't have known that you were buying at an "inflated" price. Provided you could afford the property you purchased than you weren't doing anything wrong or irresponsible. I don't consider people who responsibly bought a home and now are upside down because of the drop to be whiner's. They are good people in a bad situation. They could just leave and let it go but they are RESPONSIBLE people. Oh yeah I close on my refinance next week, will save over $100k in interest expenses, but hey how irresponsible of me.
@anonymous: You are SOO brave! Since you are so perfect and all-knowing tell Jesus I said Hi!
We will be "irresponsibly" refinancing out of our "creative" interest only loan to fix our stupidity. Everyone has done stupid with money and I doubt very seriously that you have not, so get off of your high horse and be honest with yourself. The one thing we do agree on is that Government Bailouts are stupid and should not exist, but I don't recall anyone here being serious about expecting to be bailed out themselves. It's called SARCASM!
I feel ya J. I don't qualify for a easy refi either. Sometimes, I get so tired of being responsible and still getting screwed.
hey guys! thanks for all the comments :) even you Anonymous. while you're certainly not making any more friends here, you sure do know how to help market my blog - and for that i am grateful.
I do, however, hope that you're only choosing certain words like "outright stupid should end up in tents" to stir up controversy. Regardless of your opinions on this housing ordeal, having some compassion towards fellow mankind wouldn't be so horrible. It would really suck if you'd want your mother or family out on the streets because of a bad decision.
Nice post J, and some pretty good comments here as well.
I have to agree with Anonymous to some extent, there is some amount of responsibility that was disregarded during the housing boom. The fact that everyone thought the prices would only go up was foolish and there should have been more caution for those buying houses just for the potentially huge profit, as well as caution on the part of the banks. The banks were doing things in an unreasonable manner.
I also agree with J, some compassion is necessary when talking about this kind of thing, apparent by the need for anonimity on Anonymous' part. Some people did not buy a house just for the profit, but to make their lives better and improve their futures. The problems caused by the market crash effect everyone even those that made good decisions. People that were good at their jobs and made good decisions lost their jobs and are in trouble just the same.
Different Anon (Jake) without his own website.
That's a tough situation, but couldn't you liquidate a lot of your cash savings and pay the difference. I know that it would be tough, but you could calculate your monthly payment and perhaps save as much as $500 which would allow you to replenish your cash savings account while living on a shoestring.
Rates could stay low for the remainder of this year so you have some time to think about it.
The mortgage you have could come back to bite you, especially if it is an adjustable and we hit modest levels of inflation.
You were awful nice to that person trolling. I don't understand why he likes to rub costly decisions into people's faces. He might as well go to a cancer ward and start laughing at people who's cancer came about after a poor diet or the elderly who lost their savings. As if they are unaware of the situation...
You bought your house at the top of the market and now you're upside down and can't refinance.
I bought a bunch of stocks at the top of the market and I'm upside down 50% on those. I don't expect anyone to give me a do-over.
@Anonymous (Jake) - This is true, I could certainly throw all our cash at our mortgage until I can lower it enough to refinance, but totally not worth it for me. With only 1 of us working full-time (the other is in grad school), we need our emergency fund and extra padding. Appreciate the thought though :)
@Todd - I'm not asking for a do-over, I'm asking for a chance to refinance with the thousands of others that are being given this same opportunity. If I had lost 75% of my stock portfolio and were given back a portion of it, wouldn't you want to get some back too?
Jake, your reading comprehension leaves much to be desired. I'm not rubbing poor decisions in faces; I'm saying that the people who made those decisions should accept responsibility without whining like women.
I don't see why this opinion lacks compassion. If you bought a house that you could afford, can still afford the payments and happen to be upside down...then so what if you can't refi? You will pay more than you should for the house, and that is the price you pay for your error in judgment. Lick your wounds and try to do better the next time.
If you bought a house that you shouldn't have, then I have no sympathy. Ignorance shouldn't be coddled, nor should arrogance. A lesson can be learned if you are open to the prospect.
If you're a victim of circumstance, well, life can be a bitch.
I have made several poor decisions in life and, if I'm lucky, will make several more before I'm through. I realized the futility of whining a long time ago.
If the issue is "whining," well, welcome to life. People make decisions, and discuss them. In the blogging world, this is particularly the case. The positive effect can be that others are enlightened by your situation, or that you get some good advice.
Your opinion lacked compassion when you called people "criminal and outright stupid" and said they should end up in tents. No one is saying ignorance/arrogance should be coddled, but no one is generally taking it far enough to say that people should be forced out onto the street to learn a lesson. Except you. Which is not remotely compassionate.
But hey, considering how obnoxious you are, I think that's all the time I'm going to devote to you. Wouldn't want to come across as whining too much--especially as a woman. You know how we can get! *rolls eyes*
We are in the process of refinancing, and I was shocked at how low the appraisal came in. Fortunately we had put enough done when we bought five years ago, but it is still disheartening. The Federal program President Obama initiated can assist some homeowners to refinance even if they are underwater, but the refi loan cannot exceed 105% of the home's appraised value.
*Blur* *Blurb* Yep, I'm underwater right there with you, J. Wow, you really stirred up the pot with this post, didn't you? This subject does seem to really get people fired up. Thanks for mentioning my post in the comments, by the way. I really appreciate it!
There won't be refinancing for me either, fortunately most of my interest rates (yes, rateS...sigh) are pretty good. I have one though that I would love to refi. Ah well, I do have the utmost faith that the housing market in my area will bounce back, it just may take longer than I originally thought.
I think that there is one major point that Anonymous missed. And that is, the folks on here are not "Whining" about their own circumstances, however shoddy they all might be or sound. Most people leaving comments on this blog entry are Raising Serious Concerns and Complaints about the INEQUITY of the housing bailout. The complaint and concern is over the fact that most of the "homeowners" being BAILED OUT SIMPLY DO NOT DESERVE IT!
A majority of the people being bailed out are the ones who made the mistakes of getting too much house on too little income, buying at the height of the boom and expecting to make a killing on their equity, AND all with shady loans! And these are the people who trash and gut their fancy homes once they are evicted for Non-Payment.
All the while those responsible homeowners who pay their mortgages and have become "underwater" on their loans simply due to the value freefalls, cannot get a simple refi to make it a little easier to CONTINUE PAYING THEIR BILLS.
I hear you! The only reason we were able to refi is that we put a huge down payment on our house last year, but we still lost over 50k in equity by refinancing. So. Hang in there and hopefully things will start the upswing soon!
USAA will be brought to its knees because of their partner GMAC loan servicing. USAA has gone to bed with the worst, most abusive company in America. USAA told me they would not sell my mortgage when I applied. That was a lie and I have proof. GMAC is making my life a nightmare with fraudulant Loan Modification procedures. All of my mortgage payments have been made to USAA and their name is on all of my documentation. Yet USAA washes its hands of the issue and blames GMAC. I gave USAA a $50,000 down payment and sent over $60,000 in monthly payments always on time. I have maintained my home in excellent condition and invested over $20,000 in structural repairs that were necessary. Guess what USAA - that makes me an excellent customer. Yet when I got in trouble and looked for help you
turned me over to GMAC and the nightmare has dragged on for one year now. USAA is defaulting on my "approved" loan modification and has taken over $6000 of my money in the process. Shame on USAA, Joe Robles, President and CEO and David Bohne, President. I contacted them both to let them know of GMAC's dirty games. They both responded with sanitary and whimpy responses. I have given them every opportunity to clean up their GMAC mess but they don't
care. They go home every night to their cozy homes and return the next day to their cushy jobs. They both know who KenK is.
Wow, well that doesn't sound good :( I'm sorry to hear about that bro. I saw that you left the same message over on USAA's What's On Your Mind which is great! The guys over there pay attention and should hopefully get you squared away.
If you haven't already, you might also want to hit up both John & June (USAA folks) on Twitter as they're great at helping & responding:
@JohnHancock61
@AskJune_USAA
Hope you get it all resolved!
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