Mortgage Forum

Joel Fraser

Hi, first of all thanks for having this site available for all of us who have fallen into this nightmare. The short version of our situation is this: Two years ago we refinanced our mortgage and ended up with two loans, the first has a balance of $270k and the second's balance is $80k. Within a month, Litton purchased the first and US Bank purchased the second. The first is interest only, 9% fixed for the first two years, the second is 11% fixed at 15 years. Our house appraised at $450k at the time. We were doing some major renovations with the idea that we could sell when the work was completed. We did a lot of work on the house by our own labor and it is still not finished. Not a good idea in hindsight. About six months ago, we started feeling our finances tightening up and we contacted both lenders advising them of such and asked if there was anything that could be done regarding a modification or if they had any ideas. Both responded: your are not behind in our payments and there is nothing they can do. Litton later sent us a letter advising that our loan was about to adjust. They stated we could send a hardship letter requesting a modification. We did so and they sent a form and a demand for $625.00 for "fees" to modify the loan to a fixed interest rate at the same rate for two years. We had ten days from the date of the letter (which arrived five days later) to make a decision and send the money. We did so and later received the modification package. The terms were not acceptable. The loan payment did not increase that dramatically and we tried to explain that the present amount was hard to pay. We did not agree to the terms and did not send the docs back. We signed up for credit counseling. We continued to attempt contact with both lenders advising them of our situation and no response back. We got to where we could not make our payments. We continued to contact both lenders asking if there were some options. They didn't have anything to offer. We advised them that we were going to use our mortgage payment money to rent a house. No reply. Phone calls are routed to voice mail that never gets returned. The assure us they will call us back and don't. They are not even calling us to ask about the payments. Litton finally did say they would consider a short sale. The house is maybe worth $270k now. We have the ability to purchase a 2 year old, new, owner financed home that is way below market value. There hasn't been any interest at all on our house. I located the email addresses for Litton's corporate officers and I am getting ready to send another round of letters to them and when I find US Banks addresses I will to them also. So, and I apologize for this being so long (and this is the condensed version), but, does anyone have suggestions. We are about to walk away from all of this and purchase the new home that does not require any work. Thanks again for your great site and any help.