Mortgage Forum

Mike

I'm a bit embarrassed at how little I actually know about the loan that I am on and how it will affect me. What I do know is that I have been making the minimum payments and negative amortization has been going onto my loan every month. We started at $500k in Jan 2006 and are now at about $550k, with the 3 year period where we can make the minimum (neg am) payments up in Jan 2009. I know it's a ways off but I am already feeling very nervous about what will happen in Jan, and can't help but think I should be doing something proactive. The loan type is "30 Year Conv Jumbo Pay Option ARM". Basically, the loan resets every month according to the current interest rates. We were as high as 8.375% but with the current rates lower, we are "only" at 7.25%. When Jan 2009 comes around, at the current rate, we would need to come up with an extra $1500/month just to make the interest only payment and nearly $2000/month to make the 30 year fully amortized payment. This is a HUGE jump for us an we will not be able to make it. So I guess I was hoping to get some advice from anyone with a similar loan type. I was thinking that if I could get countrywide to change my term to 5.25% interest only for 5 years, I could manage to make the interest only payments as they would be only about a $500/month increase which we can handle. Does anyone know if this is something that CW can or will do? I have a bad feeling that they will turn me away if I call now asking for help but I would like to get things in order before Jan 09 when I will have to either not make a full payment or stop paying altogether! We should be fine in 5 years as my wife will be back at work...we had another child so she did not go back to work as soon as we had hoped which is why we will come up short on payments come Jan 2009. Thanks for all your help!