Mortgage/housing advice

Oppositeboy · 09-03-2007, 09:01 PM

I don't have anywhere else to go for advice, and I know there is a ton of knowledge (and bullshit

) here. Please give me some sage advice from the PBB.

My in-laws were laborers. They are both retired. They don't speak english very well, and tend to get worked over pretty easily, and because of that, I need to look out for them.

Apparently they re-financed a few years ago and got duped into one of those ARM loans (or whatever the adjustable rate mortgages are called). They are getting calls from someone to re-fi their house again because the rate is about to go up 3% and they really can't afford that.

The person calling them is NOT the one that did the original loan. When I asked why the original loan writer isn't contacting them, my wife said he is probably in jail (with a crew of people doing illegitimate things to get loans from people).

So basically, what is the best way to deal with this? My FIL is not in the greatest health. They have no where to go but my house, which is something my wife and I really don't want to happen. If they sell the house, they might be lucky enough to pay off the amount owed on the house (with how much prices have dropped). Suggestions? Do I try and convert/re-fi to a fixed rate loan? Do I just sell and try to recoup all that is owed on the house and try to get them into an apartment? Do I just drink bleach and let someone else deal with it? Please school me PBB.

Willys Freak · 09-03-2007, 09:15 PM

Up 3%? I'd call BS on that, every one I've heard of has a cap of 1%. If they signed on with a company and agreed that 3% was ok then they got reamed hard.

That said, if their rate is higher than 6% or so and they have an ARM I would definitely suggest refi'ing with a reputable company, not some random person calling on the phone.

Reminds me of the

companies that keep calling and telling me my auto warranty is about to expire or has expired.

Anyway, go with them to your local credit union and have them explain what loan options there are. If you're thinking about convincing them to sell, call a local real estate agent and see if he'd be willing to look up comps or give you a ballpark asking price so you can get an idea of what the local market is like.

Basically, find out all the options and pick what makes the most sense.

Oppositeboy · 09-04-2007, 08:27 AM

I've talked to a real estate agent already about selling it. She did all of the leg work as if we decided to sell the house and figured we would be lucky to pay off what is owed on it. The house is fairly old (built in the 50's or 60's). No central heat/air. There was a one room apartment added on before they bought the house. They added a bathroom onto that, but it was never inspected and needs work. Unfortunately I don't have the money to tear it down and get it done the right way at this point in time.

I guess I'll have to call my bank and see what they suggest about a re-fi.

Apparently we've got their contract at home. I've been wanting to read it over, but the wife hasn't been able to find it yet. This is all based on a letter and a shady realtor (IMO) trying to get my in-laws to re-fi with them...

Looks like I'll also be talking to USAA about it this week. Thanks!

2Dogs · 09-04-2007, 08:37 AM

Quote:

Originally Posted by Oppositeboy

I've talked to a real estate agent already about selling it. She did all of the leg work as if we decided to sell the house and figured we would be lucky to pay off what is owed on it. The house is fairly old (built in the 50's or 60's). No central heat/air. There was a one room apartment added on before they bought the house. They added a bathroom onto that, but it was never inspected and needs work. Unfortunately I don't have the money to tear it down and get it done the right way at this point in time.

I guess I'll have to call my bank and see what they suggest about a re-fi.

Apparently we've got their contract at home. I've been wanting to read it over, but the wife hasn't been able to find it yet. This is all based on a letter and a shady realtor (IMO) trying to get my in-laws to re-fi with them...

Looks like I'll also be talking to USAA about it this week. Thanks!

USAA's loan process will be the most strenuous. Very thorough company. Do not be afraid to shop around, maybe try 3 competing companies. If they do not back their own loan find out who does (like Wells Fargo, don't go through the process for 3 Wells Fargo backed companies....).

Do not walk away from the current lender - RUN!

SeanP · 09-04-2007, 08:41 AM

is there equity in the house (is it worth more than is owed on the loan)? If there is no equity, you will not be able to refinance.

where are you located and when was the house last sold?

SeanP · 09-04-2007, 08:43 AM

also, check the original paperwork to see if there is a prepayment penalty. If there is and your in-laws do not have any equity, your best bet might be to just walk away from the house and let the bank have it. Have the in-laws taken HELOC money out of the house? In CA there are rules about walking away from that debt.

good luck, this is a crappy situation

Oppositeboy · 09-04-2007, 09:27 AM

I believe they bought the house around 6 years ago? I can't remember for sure. They owe $165k and before I knew all this was going to go on, they put me on the title, and I pulled a $50k home equity loan to help jump start my wifes business. Now there is $215k owed on the house. They wanted to have just me on the title because they were afraid they would lose their house because of MedCal/MediCare/whatever it is. But right now, it is me and my MIL on the title. What a PITA...

rugger · 09-04-2007, 09:43 AM

Quote:

Originally Posted by Oppositeboy

Looks like I'll also be talking to USAA about it this week. Thanks!

I'm guessing that since they are laborers that they do not have access to USAA or its banking services. I recommend that you do not use your priveledges and ruin yourself financially while trying to help them. Do not let their poor decision making induce the same in you.

edit: somehow I missed your last post......I guess that this advice is too late

09-03-2007, 09:01 PM	#1
Oppositeboy Registered User Join Date: May 2002 Member # 11965 Location: Land of the Liberals Posts: 407	Mortgage/housing advice I don't have anywhere else to go for advice, and I know there is a ton of knowledge (and bullshit ) here. Please give me some sage advice from the PBB. My in-laws were laborers. They are both retired. They don't speak english very well, and tend to get worked over pretty easily, and because of that, I need to look out for them. Apparently they re-financed a few years ago and got duped into one of those ARM loans (or whatever the adjustable rate mortgages are called). They are getting calls from someone to re-fi their house again because the rate is about to go up 3% and they really can't afford that. The person calling them is NOT the one that did the original loan. When I asked why the original loan writer isn't contacting them, my wife said he is probably in jail (with a crew of people doing illegitimate things to get loans from people). So basically, what is the best way to deal with this? My FIL is not in the greatest health. They have no where to go but my house, which is something my wife and I really don't want to happen. If they sell the house, they might be lucky enough to pay off the amount owed on the house (with how much prices have dropped). Suggestions? Do I try and convert/re-fi to a fixed rate loan? Do I just sell and try to recoup all that is owed on the house and try to get them into an apartment? Do I just drink bleach and let someone else deal with it? Please school me PBB.

09-03-2007, 09:15 PM	#2
Willys Freak Registered User Join Date: Oct 2000 Member # 2007 Location: Temecula, CA Posts: 327	Up 3%? I'd call BS on that, every one I've heard of has a cap of 1%. If they signed on with a company and agreed that 3% was ok then they got reamed hard. That said, if their rate is higher than 6% or so and they have an ARM I would definitely suggest refi'ing with a reputable company, not some random person calling on the phone. Reminds me of the companies that keep calling and telling me my auto warranty is about to expire or has expired. Anyway, go with them to your local credit union and have them explain what loan options there are. If you're thinking about convincing them to sell, call a local real estate agent and see if he'd be willing to look up comps or give you a ballpark asking price so you can get an idea of what the local market is like. Basically, find out all the options and pick what makes the most sense. __________________ Black Star Superstar

09-04-2007, 08:41 AM	#5
SeanP Registered User Join Date: Oct 2001 Member # 7354 Location: Rocklin, CA Posts: 2,203	is there equity in the house (is it worth more than is owed on the loan)? If there is no equity, you will not be able to refinance. where are you located and when was the house last sold? __________________ If you are not pissed off, you are not paying attention.

09-04-2007, 08:43 AM	#6
SeanP Registered User Join Date: Oct 2001 Member # 7354 Location: Rocklin, CA Posts: 2,203	also, check the original paperwork to see if there is a prepayment penalty. If there is and your in-laws do not have any equity, your best bet might be to just walk away from the house and let the bank have it. Have the in-laws taken HELOC money out of the house? In CA there are rules about walking away from that debt. good luck, this is a crappy situation __________________ If you are not pissed off, you are not paying attention.

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09-04-2007, 08:27 AM	#3
Oppositeboy Registered User Join Date: May 2002 Member # 11965 Location: Land of the Liberals Posts: 407	I've talked to a real estate agent already about selling it. She did all of the leg work as if we decided to sell the house and figured we would be lucky to pay off what is owed on it. The house is fairly old (built in the 50's or 60's). No central heat/air. There was a one room apartment added on before they bought the house. They added a bathroom onto that, but it was never inspected and needs work. Unfortunately I don't have the money to tear it down and get it done the right way at this point in time. I guess I'll have to call my bank and see what they suggest about a re-fi. Apparently we've got their contract at home. I've been wanting to read it over, but the wife hasn't been able to find it yet. This is all based on a letter and a shady realtor (IMO) trying to get my in-laws to re-fi with them... Looks like I'll also be talking to USAA about it this week. Thanks!

09-04-2007, 09:27 AM	#7
Oppositeboy Registered User Join Date: May 2002 Member # 11965 Location: Land of the Liberals Posts: 407	I believe they bought the house around 6 years ago? I can't remember for sure. They owe $165k and before I knew all this was going to go on, they put me on the title, and I pulled a $50k home equity loan to help jump start my wifes business. Now there is $215k owed on the house. They wanted to have just me on the title because they were afraid they would lose their house because of MedCal/MediCare/whatever it is. But right now, it is me and my MIL on the title. What a PITA...