Strategic Default – real stories from real homeowners
The following is a comment posted on this website from a frustrated homeowner, in response to my blog about Strategic Default and Depleting Savings / Retirement Accounts. I think the comment contains a powerful message, so I posted it here, below.
The entire comment is worth reading, but check out this sentence in particular:
I can see no reason for me to use the last few dollars of my savings after having depleted my retirement, in order to satisfy a bank that cannot and will not produce the note, has placed me in a mortgage that is impossible to maintain and illegal, and continue to pay for a property that by the preplanned ponzi scheme perpetrated by the banks, is continually decreasing in value.
If you’re in the position of having to deplete savings/retirement monies to pay a mortgage on a home that’s already underwater, I’d think long and hard about this entire comment and this sentence in particular. As you do, bear in mind – these aren’t my words. These are the words of a frustrated Florida homeowner. Unfortunately, he’s one of many who have shared horror stories like this with me.
I have tried for 4 years to negotiate with the servicer on my mortgage. Initially I asked them to waive the pre-pay penalty so I could sell the house without having to pay to do so. I was denied on the basis that the pre-pay penalty was 3 years at 3.5%. in 2007 the property values fell so drastically that I again asked my lender to recast the note and lock in the rate, since they had put me into a flex pay mortgage which I was not informed of until I noticed the principle increasing when I made what I thought was the required mortgage payment. They refused telling me I would have to requalify and based on my current working situation, being 1099 my income would not support the refinance, plus all the fees added on to a mortgage that was already higher than the value of the house.
In September of 2010 after almost depleting my savings and 401K. I again approached the servicer firstly requesting they produce the note, since in looking over my loan package, I had not been given one single copy of any document I supposedly had signed. All the documents were blank. They replied telling me I would need to submit a total of $185.00 for them to produce a note that I should have been given at signing. I refused. In october I received along with this letter requesting payment, a letter from the servicer, telling me my interest rate had dropped to 3.5% from 4.25% and the index had been reduced by half, yet my mortgage payment had increased by $115 per month! Immediately I called them assuming there had been a mathematical error. I was informed they had recast the note (as the docs which I don’t have indicate it can be done every 5 yeears) and shortened the term in order in increase the payment thereby increasing profitablility! I was completely outraged. I’m 60 years old and struggling to make a payment as it is and in reality I am no longer in any type of good health to maintain their property. Up to that point, I was current. I informed them I would no longer be making any payments as I had recast my budget and it was no longer financially feasible for me to be paying them for the privilege of maintaining their property. Henceforth, they could pay ME to maintain it or it could simply fall into disarray. I had been postponing moving back to Canada to take care of my aging mother and a sister who is terminal in the effort to take care of this house. Now I am moving back to Canada, I’ve rented the house, and I’ve strategically defaulted on my mortgage. I can see no reason for me to use the last few dollars of my savings after having depleted my retirement, in order to satisfy a bank that cannot and will not produce the note, has placed me in a mortgage that is impossible to maintain and illegal, and continue to pay for a property that by the preplanned ponzi scheme perpetrated by the banks, is continually decreasing in value.
I will need an attorney I am sure, and I will certainly call on Mark for this service. I am impressed! It is refreshing to see there are attorneys out there who truly defend and represent their clients and expect the letter of the law ot be adhered too.
Thank you for this blog..I will be calling your office on monday!