Evan LeFloch's Discussions

Evan LeFloch, Warshaw Capital LLCWe've been waiting 16 days for Zillow approval.  Can you see what's taking so long?

ID4Richard, why do you need a loan MOD?  I understand you're current...are you facing an ARM adjustment?  Why get out of the option arm you're in?  If you just start paying the interest only payment, you won't add any more debt onto the house.  What rate, balance, and value do you have?

Call your bank, and tell them you either want to renegotiate the balance, or you'd like to apply for a short sale.  If your credit is good, no lates, and you can show that you can afford to make the payments, they will reduce your balance, and lock you in for at least 2 years at something.  You're looking at a 60-90 day process with you always calling them (I would follow up at least every other day). If they won't lower your balance, do a short sale.  Same time table for approval.  Basically, you can sell the house for fair market value and American Home Mortgage will forgive you for the remainder of the debt.  (I know someone who owed 500k on a condo in FL, sold it for 250k and the bank forgave him for the rest).  Best of all, if the house is owner occupied, you don't have to claim the forgiveness of the debt as income on your income taxes.  (this is temporary, during housing meltdown) Don't feel too bad.  Think about the guy who put 200k of his hard earned cash down, and lost all his equity.  Plus, you're not alone.  The reason it takes so long to get either effort done is because there are 10s of thousands just like you in line. Don't hire someone else to do it.  Keep a file of all your paperwork, get them docs quickly, and ask for supervisors if you don't like the resonses you're getting.

Quotes are free.  Most brokers/lenders can give you a basic idea of what you're rate/fees will be by answering the following: purpose (purchase, refi, cash-out), LTV, credit score, can income be varified, loan amount, liquid assets Once you get some idea of how it will price out, contact a lender/broker to approve you for the loan.  Some will charge an up front application fee, but most will just make you cover the appraisal costs.  Make sure you get a good faith estimate before you spend any money on anything. Hopes this helps a little.

If you can put 3% down, you can get an FHA loan w/ a 530 credit score.

You should get a copy of your credit scores and report.  Banks use the lower of the 2 middle scores.  They will require you to pay off the non-medical collections before you can close.

If you have a 620 score, it's possible to go Fannie Mae or Freddie Mac (same 3% down), and the automated system may not require you to pay off any collections or charge offs.  Your best bet is to talk to a couple of mortgage brokers in your area.

Rob's right.  Plus it better be a beach house/lake house, or you're going to need a great letter of explanation.  Remember, you're signing the affidavid of occupancy at closing, not your broker/lender. Here's a good guild to follow for investment properties right now:Single Family & Two Family, 10% down (15%-20% if distressed market)Three Family & Four Family, 25% down Look for short sales because the homeowner doesn't care what they're selling for.  People that are 2 or 3 payments behind that just want out and don't want $$.  Bank forgives them for the debt, and you get the house cheap. P.S. I wouldn't put too much stock in that 5.375% 5/1arm, unless you're paying points.  Everyone agree to that?

Also, no such thing as home equity loan on the investment property.  I wouldn't worry so much about rate.  Investment property rates are not that bad (mid to high 6s), and you're spreading the risk around, instead of jacking all the equity out of your best asset, and paying cash for properties that may/may not prove to be solid investments.  Play with the O.P.M (other people's money).

It is possible to refinance a first w/o touching a second.  However, it is impossible to refinance if you're upside down.  A modification agreement is your best route.  Starting early is great advise (it took me 4 months to get mine completed).  If you really play hardball with your lender, they may forgive the entire debt, or a portion of your second mortgage.  You can use as your bargining chip the fact that you can walk away from the property, as you have nothing to lose.