We bought our home in 1995 put $25K down and mortgaged $70K for 15 years @8,5%. The mortgage was not originated with Citi but is serviced by them and I believe the mortgage “investor” is Wells fargo.
Long story short; the last two years have been difficult but we’ve been managing to stay under 90 days on the mortgage payments including Taxes and Insurance. The current principle balance is $8,5XX.XX not including the most recent payment (July) we sent which has not been credited to the account as of yet. Citimortgage has been accepting payments 30-60 days for the last 24 or so months and yesterday I received a notice that they have forwarded our file to an attorney. FYI the maturity date of this note is July 2010.
It feels to me as if they are now playing hardball and they want to grab our house because we have big equity (home value $125K+). Previously I suggested to a citi rep that we eliminate the escrow account and subsequent $500.00 per month deposit to reduce our total monthly payment due from $1,127.xx to $642.xx so we could bring the note current quicker. Any ideas on how to fight this and or get Citi to forbear a forclosure action?
I doubt they are trying to grab it for equity. What is more likely is they are dealing with the situation now since the balloon note is going to explode in July.
And that is where I think your biggest problem lies. With your delinquent payment record it is probably going to be difficult to find a new lender to refinance the loan in just eight months. You should contact some local mortgage brokers and discuss the situation.
Selling the house to avoid foreclosure and recapture some equity seems like a reasonable solution as well. And as a last resort you could look at a Chapter 13 bankruptcy but that is complicated by the maturity date coming so quickly.
Find a local bankruptcy attorney you like and go discuss your bankruptcy options with them.
I think you need to put all the options on the table and really consider selling the house before it is taken from you. Losing it an an auction would be a shame.