My husband originally refinanced his house with NovaStar Mortgage when his ex-wife left him (she ran up mega credit card bills in his name without telling him and didn't pay them). NovaStar mailed us a letter saying that Saxon Mortgage Services was taking over our loan. It's an ARM, with a rate of 10.55%.
Husband currently owes $117K on a house now worth $68K. He has not missed a payment in the 2 years since he refinanced, and the ARM is due to reset (which probably won't happen until next year, if the Fed doesn't raise their interest rates). So, we want to renegotiate our loan into a lower, fixed rate and despite numerous calls, they refuse to negotiate with us.
We keep getting lower echelon CSRs who have no authority to do anything and they refuse to pass us on to someone who can, in spite of us telling them that we have no problem walking away from this house if we end up not being able to afford the payments (right now, we pay $1200 a month, $56 of which goes to principle, $113 is escrow for taxes and insurance, and the rest goes on interest).
I have been told by a lawyer that in MN, they cannot start foreclosure until we are 6 months in arrears. Then we have another 6 months to negotiate a buy-back. So it would be a year before Saxon could even get us out of the house to try to sell it (and there are houses in our small town that have been on the market for 2 years and have not sold yet).
I told all of this to every CSR that I talked to, and told them that if they refuse to negotiate with us and end up foreclosing (which we are trying to prevent), they will not only lose at least 1 year's worth of payments while they're trying to get us out of the house, they'll also lose another couple of years' payments while they try to sell the house. And if, IF, they manage to sell it, they sure as hell won't get $117K for it, they'll be lucky to get $50K. After hearing all of this, they still refuse to negotiate with us.
Our solution? We hired a lawyer to deal with them, a lawyer who is experienced in negotiating loan modifications. So now they get to deal with a lawyer. And if he can't do anything for us, well, Saxon will end up with a house that they're going to lose at least $60,000 on if and when they sell it because they're too stupid to realize that not everyone is invested in keeping a house.
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