So sad

From a reader:

I’ve opted to go through the CT state modification program. The lender refused to discuss modification until I defaulted…so here we are.

I have no interest being a burden on other taxpayers – I want to renegotiate the terms of my loan.

This is all my fault. I don’t expect anyone else to pay my debts.

Banks, countries, cities and states will be bailed out (funnily enough by me and other taxpayers). We’ve all lived beyond our means. All of these will get more funds to survive. I won’t.

Nobody cares about the guy in the street.
I screwed up…most people on this blog would seem to think hey buddy that’s your fault, so pack your bags and go….

we’ll see how it works out…I’ll let you know…

Commentators, heads up: no bashing – I won’t  tolerate or post it. I was showing a distressed property yesterday – five children’s bedrooms, all occupied. Knowing that those kids were all going to be moving on to a different, worse lifestyle in a few months was a depressing, sad event. It affected my buyer clients too. No wonder it’s hard to sell houses in this market: there’s no joy in it anymore.


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16 responses to “So sad

  1. Retired IB'er

    My only quibble with the poster is that “we’ve all lived beyond our means.” Not all of us…

    Still, it looks like it will be getting worse not better. Take a listen to Meredith Whitney. She remains very bearish.

  2. Modification Newbee

    Retired IB’er,

    Of course I misspoke. I should have said “not all of us”

    Ironically, I’m now going to be negotiating with a lender who has bought these loans for pennies on the dollar with my (and your) tax dollars.

    They can’t lose….

  3. New Buyer

    It would seem that the banks have a purely selfish, market driven motive to renegotiate some mortgages on homes facing foreclosure. They can move these properties off their default list and avoid a short sale. Am I wrong on this? And if that premise is true — banks can profit by renegotiating terms with some borrowers — what is hold them back? they just don’t know how to do it? Don’t want to let the Genie out of the bottle?

    • New Buyer, I think the banks are just swamped and can’t handle it. I’ve been trying on behalf of a buyer to pay one lender 100% of its debt for six weeks now and could only get a real person to at least pick up the phone when I found a lawyer who knew a lawyer, etc. It’s crazy out there.

  4. New Buyer

    Thanks for your answer – albeit a sad one. It’s what I feared. I do think that there are plenty of solid, hardworking homeowners who would do anything to keep their homes (or credit) and stay afloat given the chance. The sad thing is they have so few options, no one to negotiate with, and are just anonymous cases. The ones who could potentially save their homes are riding the wave of foreclosure with a everyone else. We used to tease my depression era grandparents for fearing the banks and paying for everything in cash (some stashed in socks) — now I understand their aversion.

  5. Retired IB'er

    Mod. Newbee,

    While it sucks to have to go through what you are, the good news is that at least you’ve taken the first step toward unwinding the mess. If you’re anything like me, the worse part of crap like this in life is anticipating/worrying about the outcome. Better to get on with it… though I recognize that is much easier for me to say than for you to do.

    Best advice I can give is don’t beat yourself up over past decisions. No one get’s it all right: and none of us make it through life unscathed.

    Good luck.

  6. Fly Girl

    Modification Newbee,
    FWIW does care about the man in the street as witness that CF wouldn’t allow any bashing. I am appreciative that you chose to tell your story here. Good luck and please let us know what happens.

  7. Greenwich Gal

    Mod. Newbee – Take Heart, Life is full of second chances. I once worked for a millionaire who had gone bankrupt -not once, but twice – and finally he hit it big, real big. So, you just never know. Maybe better times are right around the corner.

  8. Way Up Valley

    TR said it best, forever after:

    Do the best you can, with what you have, where you are.

    No one can do more. No one should do less.

  9. HG

    I don’t think Mod Newbee should feel bad. Also I do think we ALL have been living beyond our means. I suggest the following calculation to reflect the amount each of us has borrowed from our children by electing a succession of representatives–both Republicans and Democrats–who promised us free money: $50 trillion true government debt divided by 100 million US households times your estimate of the ratio of your annual tax bill to the average US personal tax bill. The calculation for the average household is around $500,000. What do you think it is for YOUR household, high-income Greenwichers?

  10. out looking in

    for each of us, existence is quite fragile, for some more than others- shake it off- its only money..if you and yours can walk away- you are better off than most. Unfortunately our society is on the precipice of that knowledge curve

  11. mid-country mark

    Chris, what are the legal ramifications in Connecticut for a owner to just mail the keys back to the bank? I know that credit is trashed, but I think I recall you saying once that some states have laws against this and would expose a borrower to legal action. Thanks.

    • Connecticut law distinguishes between the mortgage and the promissory note. You send in the keys, you’re still liable under the note. In many states, the borrower’s liability is limited to the value of the property but not so in New England and certain other areas (I’m no expert on the laws of the various states, so you want to ask a lawyer in your particular state). As a practical matter, will a bank chose to pursue you after they take the house? I don’t know, but the potential liability will hang over your head for years, which sucks.

  12. mid-country mark

    thanks. So if I understand it, a bank could sue me for the full value of the house even after they get the house back?

    Are you aware of instances where banks do go after people even after they get the house?

    • Mid-Country, they would have to sell the house first and then sue for a “deficiency judgement” – the difference between what you borrowed and what the house sold for. Say you borrowed $1.8, and they sold it at auction for $1.2. You’d be on the hook for $600,000. Will they do it? Hell, these days I can’t get these people to return calls even when I’m offering to pay them 100% of their mortgage, they’re that screwed up.
      But eventually, they may sell your debt to a collection mill for pennies, and those people could come after you hammer and tongs.