Behind on Mortgage for months?

[boothev]

How do other people do this? I am currently behind on my mortgage - ALMOST 3 months.

I sent in one payment yesterday, but the customer service desk said they would probably send it back, because they want all three months. Is this just CSD lip service? Standard sentences they have to say?

How do people hover 2 and 3 months behind for a period of time?

Side note - I just discovered Dave Ramsey, so I am gearing up for Gazelle Intensity in attacking debt and sealing my financial leaks.

Hoping to be ALMOST 2 months behind, then ALMOST 1 month behind, then not behind at all,
Valerie

[Tree0164]

Valerie
I would call back and speak to a supervisor. Probably the csr was giving you lip service-about sending it back. The bank doesn't want to go to forclosure. Speak to the supervisor and let them know why you were behind-job loss etc.

Good luck!

[boothev]

I am hoping she has NOTHING to do with the department that processes payments.

It would be great to have the payment post to my account as planned, regardless of what she says. I am hoping to send in a full payment every 2 to 3 weeks until I am caught up.

It is a VA loan. I guess I will have to call back.

I just wondered how other people can be one payment behind for 6 months.

Spring is very effective for us to attack debt and realign the budget. We get a bonus at work in January, a medium-sized tax refund, and I work for H&R Block through the tax season. All this money goes to the strongest drain on our budget: debt.

But then for the rest of the year, we make only baby steps. The last thing I want to do is take ANOTHER 401k loan. That just makes my paycheck smaller.

Thanks again. I was letting my emotions muddy up my thinking.

Valerie

[terry1156]

Definitely contact the supervisor and explain the situation. It is very frustrating when you are doing your best to get things back in order and someone treats you like that. Try and ignore that and work toward the goal of getting back on time with the mortgage payments.

Feel free to post your budget if you want and we can take a look at it and see if there are areas where you may have missed where some more savings can be squeezed out.

[mom-from-missouri]

I think they told you right. Years and years ago, I was in the same situation, after being laid off for 11 weeks, (then hired back by the same company-they over cut on a cutback). I was told the same thing--pay it all at once, or foreclosure. I went to my local bank, and got a loan. This was back in the days of $198 a month housepayments. They loaned me 4 months of payments, and I had 18 months worth of payments to the bank to pay it back. I went back to work on a different shift that enabled me to get a part time job, and paid it back in about 6 months.
However, a supervisor may be able to waive it if you set up some sort of payment arrangements. It would cost them more money to push foreclosure than it would to set up arrangements with you.

[cercis]

It all depends on your state. Some states say that if they instituted foreclosure proceedings when you tried to send in a payment, then they are in violation of state law and they are fined and your fees are waived (you still have to pay your payments, however).

But, if they've sent the initial demand letter then you could be stuck. In many states that demand letter (which is the letter stating you are x number of payments behind and you have 20 days to bring it current) means that they can proceed with foreclosure unless you completely reinstate the loan.

Talk to the supervisor. Ask if they have a "workout department". Explain the situation. Most large companies will want to work it out. A foreclosure will cost a company anywhere from $500-$2500, just for the foreclosure, then they have the costs of eviction and marketing (and you are well within your rights to make them evict you rather than moving out).

I used to work for a mortgage company doing foreclosures. I hated people who did everything they could to stall the foreclosure, because it made my job harder. But I admired them because they were doing whatever they could to survive. This included filing multiple bankruptcies (first the dh files chap 13, then after it is dismissed, the dw files. When hers is dismissed they file jointly. when that one is dismissed they start filing chap 7) this would irritate me because I knew their attorney was taking $500 each time they filed and if they would have just saved that money, they could have paid us. But as a bankrtupcy attorney pointed out to me, they only require a payment of $75 and then they take payments on the rest.

I hope it doesn't come to that for you. Ask nicely. Be courteous. Try not to get mad, but if you have to cry, go ahead and do it.

[PrincessPerky]

If none of that great advice helps, take the money out of your account (in your mind) so that in the next week while still fighting you will be ready to take the next one out like you mentioned. That way if you can just drag your feet long enough you will have stockpiled the full amount.

[boothev]

Thanks everyone, I will post my budget, because I am curious at where I am going wrong. I really think our income is too low for what we have on our plates. I am really tracking what DH brings home in tips every night from pizza delivery. He does make $6/hour while he delivers. BRB with my budget.

[boothev]

Household income from 2004 year: $45k.

Income/Net Per Month = $2200 (me) and $300 (DH in paycheck, add probably $400 in tips)
Income/Rental Property = $700 (from a house we could not sell, a reliable cousin has moved in and she wants to buy the house. She can't buy it soon enough!)

WAMU = $840 (primary)
Chase = $700 (rental)

Water = $50
Car Ins = $132
Phone = $60
Cable = $55
Metlife = $20 (term)
Metlife - $24 (term)
Gas = $133 (budget)
Cell = $60
OTTA = $15 (CollegeAdvantage)
Electric = $50
Trash = $13

Visa = $30 min payment, Balance is $1500

Fun = $0

Gas = $200 (I put 450 miles/week for my commute, DH delivers pizza)
Preschool Tuition = $100
Prescription Meds = $60
Car Repair = $0
Internet = $0
Vacation = $0
Emergency Fund = $25

Now all the extra notes:

If there is a $0, then I WANT to budget for it, but cannot right now. We just scramble for the $$ when the bill comes. Reactive, not proactive.

DH is a SAHD in the daytime, saving daycare, but works at night. Kids are 4 and 2 years old. Hopefully, the younger one will be out of diapers soon! DH is med-controlled epileptic, so I think it maybe hard to drop any life insurance on him. I wondered if I should drop the Metlife for me, DH and my policies through them are only worth $50k. I get awesome life and medical through work. Should I drop Metlife for both of us? I cover him and myself at the highest amounts through work.

We own both our cars (2002, 108k miles, and 2003, 80k miles). I work 45 miles away from home. I spend 10 hours/week in the car just getting to work, then I hand the car off to DH for delivering. We are trying to baby the 80k mile car, keep it under 100k for as long as possible.

I get pretty good raises through work. But have 401k loans that have chipped away my take home pay. My goal for this tax season was to pay off some loans, thereby increasing my take home pay. Or, saving up for an Emergency Fund. I know one 401k loan is down to $700, paid off, it would add $80/month to may take home pay. the other two loans paid off would add $220/month to my take home pay.

I always assumed things would get easier (and they have in the last couple of years) with payraises and kids getting out of diapers. No more formula, etc.

If I wanted to get serious, I guess I would stop CollegeAdvantage, Cable, and Cellphone.

Okay, let me have it! I THINK I am ready to hear what I already know deep down inside.

[mom-from-missouri]

I would keep the cell, but cut it to the barebones. With the commute you do, it could literly save your life. I would drop the cable. Where in your budget is your food? Is there a lot of eating out? Where is your household items-soap, diapers...? Hopefully those items are not going on to credit cards. If they are, you are getting into a bad circle--hard to break. Would it be less expensive to drop the metlife and get life ins thru work? I pay $1.95 a paycheck at work for my life insurance (first $10,000 is free, but I opted for more). When I was married, I paid $3.95 a paycheck to also have it on my husband.
Cqn you lower the car insurance by opting for a higher deductable? What is the blue book value of your cars? If it is very low, you may be better off to drop the coverage to collision only.
Is it possible DH can find a different evening job, with higher pay and some benefits? Our neighbors son just quit delivering pizzas as he only got 27 cents a gallon, and he was going in the hole every night with the increase of gas and wear and tear on his car. He now works nights sacking grocieries from 7-10, then helps nightstock the store from 10-2 a.m. He still gets to go to school (college) during the day, and now gets a discount 5% on items he buys at the store he works at.

[terry1156]

Going through your posted budget there is about $1000 unaccounted for (2900 in income per month and about $1900 going out listed) - much of that must be food and stuff for the kids which was not included.

As you mentioned, you already know that there are areas where you can cut if you want - cable, cell and CA. Those would bring in about an extra $100 a month depending on what type of phone service you got to replace the cell.

The insurance question depends how secure your current job is. If you feel it's secure and you're getting better coverage there, then I would consider getting rid of the Metlife. For you especially.

You probably want to get a more accurate number on tips from DH that you can count on at a minimum.

What is the possibility of selling the other property or is there an estimated time when your cousin will buy? How much equity is in there or have you already budgeted that money?

With cars getting up in mileage and being an essential part of your husband's work, a car fund for any repairs is essential.

[Fern]

#1 i would pay OFF that Visa credit card; don't just settle for minimum payments, the interest rates are ridiculous.

i think paying $120 month combined for cell and phone is too much. I would choose one or the other, probably the cell.

And yes, for cable, cut back to basic. $55/month is a luxury.

[terry1156]

What is the current interest rate on the credit card? Any chance of getting that lowered?

[boothev]

Oops, you are right! I forgot the $300/month budgeted for Food, but I know we spend more than that.

I suspect DH brings home $100/week in tip money, but we throw it up in a box and that is where Fun and Fast food comes in. I have vowed to have a meal plan and no more FFood. I keep PB&J at work for my lunches.

I used to budget low with DH's checks, about $200/month. But after looking at his stubs, I saw it was save to up it to $300/month. (His last check was actually $180.

I think my magic key is to document and use his tip money in a more useful way.

My job is pretty secure. I really like it and tell my boss at least once a qtr how much I like it. I figure it is refreshing for a boss to hear one of her employees actually likes coming into work, instead of the usual complaining. My salary has gone up $12k in 8 years. I can't complain. I am upbeat, and if they tell me tomorrow my new job is in the mailroom - I will do it with a smile. My worst day here is better than an average day anywhere else. (and I am in the insurance field!) I can really see me retiring from here, and happy with it.

Benefits are good. They match 401k dollar for dollar up to 6%. (I just stopped contributing to it this week to get my budget realigned and get caught up. I am hoping it will still grow!)

Sadly, my DH is not a spending problem. He is pretty frugal. I am the one that is out here "killing it and dragging it home." I have done pretty decently staying out of the stores, because I know I have a problem in them. DH does the grocery shopping and sticks to the list. I am pretty organized with a word doc list. We pretty much buy the same stuff, so I just hang the list up on a cupboard door and we highlight throughout the week what we need.

Last year was a rough year. Our old cars died. I bought a $500 beater car until I could get one from work. I can buy cars from work (our company leases them and EE's can buy them once the lease is up.) My last car from work, a 1996 Taurus made it to 232k miles!

Assets:

Value $110k house, owe $88k
Value $100k house, owe $76k
2002 Taurus with 108k miles for our work car (Purchased for $2700, can you believe it! It had 90k miles when I bought it.)
2003 Impala with 80k miles we try to baby until we replace the work car in 2 years. (Purchased for $5500 at 79k miles.)

We are a little gun shy on having a crappy car again. Not sure what the blue book value is on these.

Our little renter wanted a year to clean up her credit, she was already getting together with a mortgage broker. She is a nurse, so her income is decent. She LOVES the house, so there is no question of her looking at other houses.

Life Ins. thru work:

Life 1 x 43k
Supp Life 3 x 43k
Spouse Life $50k
Dependent $10k

I am the main breadwinner, so i worry that if something happens, can DH hold the family together and pay off the house, etc. After listening to Dave R., I will up the insurance through work this Fall.

We ate out far too much this summer. I think we need to go to rice and beans, and beans and rice.

I will do some tweaking of my budget and actually start COUNTING on his tip money for some items.

Thanks you guys, you are AWESOME!

[boothev]

I know what I have, my sister and I gave it a name:

"Financial Vagueness"

I know all our bills, but I have no idea what we are TRULY spending.

I have to get rid of Financial Vagueness!

[boothev]

Amendment - Emergency Fund is $50/month, I put $25/paycheck in there.

[terry1156]

Originally Posted by boothev

I know what I have, my sister and I gave it a name:

"Financial Vagueness"

I know all our bills, but I have no idea what we are TRULY spending.

I have to get rid of Financial Vagueness!

lol...you know exactly what you need to be doing -- you just needed to write it down and get a bit of feedback to get motivated.

I would suggest a specific place where DH empties his pockets with tips each night when he returns home before it disappears in unknown places. Make a pact to not spend any of the tips for a month to see exactly what he brings in.

Another great way to reduce spending is to take a look at the previous month's bill and think of ways you can reduce it. You'll be amazed at what you can accomplish when you have a set number you're trying to be under.

I wouldn't stop your 401K match - that's 100% profit and you aren't going to get a better return than that - even if you pay 28% interest on your credit card, your still coming out ahead. Scrimp and scrape everywhere else, but try not to stop up to the match.

[boothev]

Originally Posted by terry1156

I wouldn't stop your 401K match - that's 100% profit and you aren't going to get a better return than that - even if you pay 28% interest on your credit card, your still coming out ahead. Scrimp and scrape everywhere else, but try not to stop up to the match.

I know, I consider that saving "12%" of my income. I was amazed that I was adding approx. $400/month to the plan by doing almost nothing! It was growing by $1k every 2 months or so! I would log on every payday and check my balance!

[terry1156]

I think that needs to be one of your top priorities. There aren't many chances like that. Even if it means scrimping for a few years, you'll be so happy you did later on. And ig you can come up with a plan to max that while not incurring any other debt, you will really have you finances in order. Make you current "fuzzy" numbers more clear and make that a top goal.

You can also think of it this way. If it seems like you can't do it, have DH get another part-time job or do ebaying to make extra money. If that allows you to max out the 401K, it means the salary is actually double whatever he's earning (since it will allow you to get the match - $16 a hour sounds a lot better than $8.

[terry1156]

oops..almost forgot in all this...first priority is to get that mortgage up to date!