Mortgage Forum

Joel Fraser

Dear friends,I have been reading this forum for a while and I want to thank everyone for creating a community for all of us to feel a part of. MY STORYI bought a house in Los Angeles about 2.5 years ago. My wife and I have a baby daughter and we wanted her to have a yard and some space like we did as kids so we put all of our savings into a very small house... the second cheapest home we saw all year. $575K (a steal at the time). It was small (under 1000 sq feet) but cute. It needed updates but we are handy and passionate so we did them. We spent 3 months redoing the kitchen, putting in french doors, crown molding, paint, and other renovations. Our daughter played with a plastic hammer and screwdriver while her daddy used the real thing nearby. We did all the work ourselves and really sweat over it but it was rewarding.After a year we took out our equity (about 45K) with a line of credit to pay down credit cards and student loans so our credit would rise and we could refinance at a lower rate. It was a very high interest rate, but we figured we'd float it for 3-4 months it took to have the credit bureaus reflect the changes, etc. and for us to find a better rate.Well the S*** hit the fan during that time. You all know what happened so I won't get into it. We were stuck with a VERY high mortgage for the past year and a half and we ate through all our savings and barely made the bills every month. All of the credit cards are maxed, my credit score dropped because of a few late payments.The Feds are in the papers all the time saying how they cut interest rates, are pressuring lenders, blah blah. It hasn't been paid forward one bit. We were never late on one payment but it has been hell making those payments. Our family life has been incredibly stressful and my wife and I have been at each other for a year due to the financial stress. All this for the second cheapest house we saw all year. After trying to modify our loan for months (through Hopenow and our lenders themselves) we made a decision to go into a short sale. I think the turning point was when my lender rep said to me on the phone "did you know your house is worth less than what you owe? You're in big trouble" that I realized there isn't anyone out there to help... not the feds, not the lenders, nobody. It's my birthday today and I spent it signing the papers to our realtor. It is heartbreaking but a relief too. Life is too short to kill yourself over a piece of property. We're going to have to rent for a while until we can save again. I will be honest, and I think a lot of you in this forum can empathize... I feel like a failure. We put so much hope and effort into that little house and now we're walking away. I want to address for a moment all of the people out there who seem to find it funny that all of those who took a chance in this market "got what's coming to them." Not sure what the criteria is for a "subprime borrower" and if we fit that bill. I don't think we did, since we had high credit, good employer history and some money down. Either way, we were just looking for a home. Not a yacht, not an Escalade, not a summer cottage. A home to live in and invest in. And we tried to make it work. We weren't quitters, just finally felt that the fight wasn't worth it. It's not where you are, it's who you are.I hope that this market turns around and someday we all find places we can call home.