Reply #3: that last comment is stunning

[grasswire]

"The answer for me is extremely simple…INSURANCE! I am in the middle of doing a shortsale with my servicer and asked “since my home was valued at over $1million when I refinanced in April 07 and now you have already approved my buyer’s short sale for $640,000, then why would you not just drop the principle to the current valuation since I’ve been in the property for over 11 years and would prefer to have a loan modification?”
ANSWER: “…I don’t think I’m supposed to say this, but we are covered by insurance and if we foreclose or do a short sale, then we will be reimbursed for the total amount of the loan…” i.e., that’s why the banks did NOT want the cram down legislation!!
Amazing isn’t it. Now we know why the banks aren’t lowering anything but the interest payments. They could, of course, keep the current loan principle, do the loan modification for a fixed 40-45 year term, and make a profit, and still keep the current buyer in the property.
Anyway, just my opinion. In the meantime, although I’m in the process of the short sale, I plan on turning it down and plan on filing suit re Tila and Respa violations. After doing an audit, we have found that just one of the things my lender did was to overcharge me $311K over the term of the loan. I will also be pursuing “where’s the note” theory here in California.
Good luck to anyone else out there having similar problems.
kensingtont
[email protected]"