Posted by: pbrander | September 21, 2009

Peggy’s Journey Into Foreclosure

Three years ago my house needed a new roof, so I refinancedhat was my first mistake.  I didn’t understand all the details of the refinance and walked into a loan that was interest only, so in essence I was renting my house.  I was making my house payments on time (I have been in my house since 1991 with never a late payment) even though it was only going to interest.  In the winter of 2008 with heating prices so high my heating bill was enormous, I was making payments as it had to be paid off in order to have heat in winter 2009.  I live in Minnesota and heat in winter is a necessity. 

That summer (2008) the City I live in came along and told me I had to have a tree removed at my expense, gave me a number to call and gave me until the end of the day to do it.  I did and as you can imagine, it wasn’t cheap, it was a house payment.  So I paid that and in order to make my house payment, I didn’t pay anything on my heating bill for a couple of months.  Then as it was getting colder (October), I called my mortgage holder, explained the problem to them, told them I needed heat and I would have to skip a couple of months of house payments and and make it up later – the response “if you don’t have a house, you don’t need heat”.  I was shocked at the attitude, as I always believed that if you try to work with these companies they would work with you.

I got a revised payment schedule from them, but the payments were unreasonable and with my income out of reach.  Meanwhile the value of my home dropped and I owed $40,000 more than it was worth.  I called a morgage counselor explained the situation to them and was told to just let it go.  They didn’t care, I didn’t know what to do, I was unhappy with the mortgage itself as $1,000 a month payment was going to interest, no principle was being paid.  So I followed the counselor’s advice and let it go.

I know that a lot of people, most have never been in that situation, think I was in the wrong, but I was unhappy in the house, I wanted to move, I was never going to own the house again, as nothing I paid went to principle and the mortgage company wouldn’t work with me, also I was very upset over the response I got when I asked for help.  How would you feel if you asked someone for help in a bad situation and got the response that “if you don’t ________ you don’t need ________.”

What the counselor didn’t tell me was that by letting the house go, I would have problems finding a place to rent and no bank or mortgage company will even consider giving me a loan for another place.  So here I am sitting in my foreclosed on home, trying to find a way out,  I have until January.  Any ideas?   If this sounds like I’m feeling sorry for myself, I’m not.  I’m mad at myself for taking the advice of someone who really had no idea what they were asking me to give up and didn’t warn me about the consequences.  I believed that I would be able to find my dream home in the country and live happily ever after.  HA!

I’m not blaming anyone but myself.  I’m looking for a way out and I will find it, I’m an optimist and I know this all happened for a reason and that I will be able to work this out eventually (hopefully, before Janury 2010).


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