Mortgages with Countrywide - A Way Out

Posted by Daniel Peterson on October 10th, 2008 at 03:41pm

Some lenders have taken action to reach out to homeowners to provide more favorable mortgage terms (i.e., refinancing, loan modification or loss mitigation ). Homeowners have also been encouraged to contact their lenders to discuss alternatives. Before you jump into FHA refinancing it is important to know the basic requirements for FHA mortgage loans. In order to qualify for FHA refinance loans your monthly mortgage costs including principle, interest, taxes and insurance must be less than 31% of your gross monthly income. Americans have reacted to the need to keep up with the Jones by buying on credit and then refinancing they way out of it. Ummm sounds like you can not regulate stupid.

It makes no sense because we will never be able to refinance and get a lower payment. Nonetheless, the company put borrowers into these unaffordable loans, assuming that borrowers would refinance the loan or sell the home before the payments increased. Under the terms of the settlement, Countrywide will Refinance as many as 9,700 mortgages in Michigan, giving families an opportunity to keep their homes, and saving them approximately $129 million as a result of more favorable terms. Pay more than $9.8 million to assist Michigan homeowners who lost their homes to foreclosure.

Countrywide obscured the negative effects–including rising rates, prepayment penalties and negative amortization–which would inevitably result from making minimum payments or trying to refinance. The company misrepresented or hid the fact that borrowers who obtained its home loans–including exploding adjustable rates and negatively amortizing loans–would experience dramatic increases in monthly payments. This whole experience was a shame, because I’ve actually been really happy with how CountryWide has handled my mortgage (since 2000) and my previous refinance (another local office, 2003). It kills me that I made a special effort to use a local agent just so the loan would originate locally.

Refinance home loan in 7/06 for $171,000.00 at 8% ARM fixed 3 yrs., payment $1,256.00 Loan sold to Countrywide in 8/06. Loan amount then $181,000.00, 8% ARM fixed 3 years, payment $1,450.00. Refinance or Purchases call, fax or e-mail anytime ? I am happy to be at your service. When I recently refinanced my house I was introduced to many more types of loans (interest only, ARMS, fixed, etc) than I knew existed. Any good mortgage lender should offer multiple loan types so you can pick the one that best fits your situation.

There were a few smart people who understood the concepts and would understand that the slightly higher fixed rate made more sense in the long term. A short sale occurs when the mortgage lender (the “mortgagees”) agrees to alter the original terms of the loan by lowering the outstanding balance of the debt. Such forgiveness often takes place in cases of a financial deficiency, or when shifts in the real estate market result in a negative net equity on the part of the borrower (the “mortgagor”).

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