We’re in, I guess, your standard toxic mortgage situation: Tempted with a fixed rate, which was switched to a APR at the last second, told we could just pay interest-only for a while, told we could just pay the “minimum payment”, found out years later that minimum payment isn’t really a minimum payment and that we owe $20k extra, and now, of course, with the market the way it is, our house is quite a bit underwater.
Our loan has been transferred several times and now rests with Wachovia, which was bought by Wells Fargo. Some sort of loan modification would be extremely helpful, since although paying all that interest is great for getting a federal tax refund, it eats up 45-50% of our gross income (and we have another child on the way). However, Wachovia apparently only gives modifications for 2% of all requests, and then only when situations are dire. We can actually pay our loan, but only by forgoing other things, including savings and home repairs.
A friend of ours told us about someone who will do a “forensic mortgage analysis”, where they go over a loan and find anything that’s illegal in the paperwork. If there is, then a bank would be required to make a modification. Is this a useful option? Does it work the way it’s claimed?
If it is useful, would it be something I could do myself? The person I was referred to would charge $800, but would refund half that if no errors were found. Personally, I’d like to save the money and not gamble.
