CFPB
Nice win for the middle class with an underwater mortgage where the home value is much lower than the current value of the home. Stockton was one of the hardest hit areas of recession where the home values declined substantially due to over-buildin.
The bank finally agree to modify their loan to avoid a possible foreclosure:
Conusmers now have an alley with Consumer Financial Protection Bureau to champion their cause where they can file a complaint and have it investigated.
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Updated 3:19 pm, Friday, October 9, 2015
Loan Officer: Benjamin Greer.
Property type: Single-family home in Stockton.
Loan type: Harp 2.0 refinance.
First mortgage: $199,500 with a subordinating second for $66,000.
Appraised value: No appraisal required.
Property value: $190,000.
Rate: 4.25 percent.
Backstory: Few families endure such hardship refinancing their mortgage. Kimberley and Jay Moe deserved a break. The couple took out a second mortgage on their Stockton home in March 2007. Then the markets crashed, the housing bubble burst and the Great Recession hovered over the Central Valley port city.
It was the worst conceivable time to have recently opened a line of credit to pull equity from a home. The homeowners were underwater in months and remained there for eight years.
Arguably, no city suffered more than Stockton from the housing crisis. Foreclosures led to vacant properties, while others walked away from their homes entirely to send a contempt-laden message to the financial industry. During this time, the Moes never missed a payment, despite carrying a debt-to-income ratio of 62 percent.
So securing refinancing for the responsible couple was littered with adversity, as Benjamin Greer of the Mortgage Outlet soon learned.
A company holding the couple’s second mortgage denied the subordination request, citing their guidelines regarding loan size. Greer felt there was no reason both firms couldn’t work something out on behalf of the Moes, a mutual client.
He phoned managers and supervisors in hopes of reaching a decision-maker, who would help this couple save more than $600 a month.
The Moes couldn’t believe they weren’t being met halfway. They went to sleep hungry to pay the mortgage on time. Greer researched the company’s board of directors and filled them in of the situation. He appealed to their financial sense as well. Since that company held the subordinate mortgage, they wouldn’t make a dime if the home ever foreclosed. It was in their interest to take the money. Perhaps helping some deserving human beings out also factored into the board’s decision, but Greer will never know.
Three hours later, the company’s legal team said they approved the decision and would overnight the subordination request.
Benjamin Greer,
The Mortgage Outlet, (408) 352-5158, bgreer@themortgageoutlet.com