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I’m Feeling Pressured by Wells Fargo on My Loan Modification. – Tom

Written by Steve Rhode

“Dear Steve,

I bought a condo in Owings Mills, MD in 2006 at the height of the mortgage boom(fraud etc.) My name is the only one on the books. Married 1 child. Canadian Citizen.

196K Purchase price. 80/20 loan. This loan was originated My a small lender and was sold to Wells Fargo the month after…..
80: 156K 6.75% 10 yr Int only. Wells Fargo serviced in a MBS.
20: 38K 9.42% 15 yr Int Only Balloon payment. Wells Fargo home equity.

Appraisal done 115K 2 weeks ago.

When i bought the condo I was making 46k and had about 8k in debt. I feel I shouldn’t have gotten the loan. The only program that I could qualify with was the 80/20.

I make pretty good money and I have been seeking advice on what I should do to try to settle on the 2nd since they are so far out of the money and I’m so far underwater. I can;t refi into the current rates and there are no available programs to get me there.

I have been late on the 2nd mortgage for 195 days. I have a real estate lawyer trying to negotiate with Wells. The person working for him is a former negotiator for Wells so I thought that this would be GREAT!

Late october (my) neotiator asked for financials(w2, bank statements, tax returns) . I was hesitant to say yes since the research I have been doing on other sites (, yours, and others) say not to divulge information that can be used against me.

My negotiator was rushing me which I didn’t like and loan modification scams had been attempted on me in the past. Now that I’ve submitted this info I feel that I’m in a bad position. My negotiator is not keeping me in the loop unless it’s bad news. Wells pulled my credit. I didn’t say they could. I checked all my closing documents and there is no mention except to attempt to foreclose if there is non payment…..

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Wells’ negotiator wants to close the file and I’m being pressured to offer ~ 15k. I will need to borrow money if I offer that.

I have a neighbor downstairs who has the exact same loan as I with Wells(80/20) MBS/WF home equity. They are doing a shortsale now.

Have I backed myself into a corner? I feel my only choice is to counter offer their 80% they want (I don;t have) or threaten to short sale. If Wells closes the file can this be revisited? I hope you have some ideas.

thank you in advance.


Dear Tom,

The first thought that comes to mind is you could do a chapter 13 bankruptcy and probably just eliminate the second mortgage all together. But that still leaves you with the first of about $15k on a property worth $115k.

Who knows if the property will even recover to that amount.

It would be enlightening to know what your neighbor is selling their unit for on the short sale. It might just be that you are so upside down on this that a modification makes no mathematical sense unless Wells is will to offer a substantial principal reduction on the first mortgage and eliminate the second mortgage entirely.

Maybe you can help me to see where the math adds up to a point where it makes logical sense to stay in the property instead of walking away, filing a chapter 7 bankruptcy and getting a fresh start allowed to you under the law.

Oh, and if Wells Fargo is your lender, they have every right to monitor your credit report, as all your others creditors are.

It might be a smart idea to click here to find a local bankruptcy attorney and discuss this situation with them for a second opinion.

Please post your responses and follow-up messages to me on this in the comments section below.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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