Debt Finance Guide Mortgage

Mortgage Modification Trial Period Started – Check how it started 

This is the 4th post on the topic of my mortgage modification. You may read the previous 3 articles at the following links:

From the link, you will get to know for the reduction in the debt amount. The starting of the debt settlement is with the modification to have the satisfaction of the requirements. A click at the link is beneficial to get relief from the debt. You should have collect details about it to have success. 

I met with my HUD mortgage counselor yesterday morning and finished the paperwork required to put the modification trial period in motion. I mailed the first check with the modified payment and FedEx-ed the paperwork to Chase Home Finance at lunch. The payment goes to a different address than the paperwork.

My original payment was $951/mo. and my modified payment is $691/mo. That’s a monthly savings of $260/mo and will more than cover the electric, gas, water, sewer, and solid waste bills. I’ll have $90-$100 left over to put toward groceries and out-of-pocket medical expenses.

This first payment starts my trial period and is due on December 1, 2009. The second payment is due January 1, 2010; the third is due on February 1, 2010; and the fourth and final trial payment is due on March 1, 2010. If I make all these trial payments on time, my mortgage modification becomes permanent.

According to the paperwork Chase sent, my modification won’t change after 5 years, or if it does, it will not revert back to my previous agreement. It will be at a lower interest rate and perhaps for a longer loan period, but the payment will not change significantly.

Apparently, Chase does modifications a little bit differently than other mortgage companies. I have to make 4 trial period payments instead of 3. I was not required to make a good faith contribution payment, and there won’t be a balloon payment at the end of the thirty year mortgage if I don’t pay off the principal by then. My loan will be extended until the principal is paid.

Bankruptcy Update

I had to go back to bankruptcy court last week to report on my mortgage situation. I caught up my second mortgage payments last week prior to court, and the judge continued my case until February before he agrees to sign off on my second mortgage reaffirmation. He wants to be sure I’m able to keep my house before he allows me to be saddled with a $20,000 secured loan for which I might no longer own the house.

Income Update

I picked up 3 more students by the second week of November, and they cover my monthly income shortfall plus some. I will be picking up some siblings of current students during mid-term exams in December. I’m still keeping up the extra marketing because I still have a few more time slots to fill. I’ll slow down assertive marketing when all my time slots are filled.

That extra money will go to paying my back taxes and allow me to rebuild my emergency fund. The taxes are the only debts I still owe. Everything else was discharged in the bankruptcy, and I’m turning the student loan over to my friend’s parents to handle.

This month, I will have about $200 left over even though I had to catch up the second mortgage and pay a reconnection fee on my phone bill from August. Future expenses won’t be as high since everything is now up-to-date.

I worked out a good deal with the IRS about monthly payments I can afford, just $130/mo. I’m free to pay more at any time, and if or when any refunds are applied to my account, I can renegotiate my monthly payment if I need to free up more cash. I may have to do that to increase what I pay to the state.

I haven’t worked out a deal with the state yet. I’ve been paying them what I can each month, around $30, and they accept my payments and haven’t started harassing me yet. I’m sure they will eventually, but as long as they are receiving payments, they will get to me after others who owe a lot more and are not paying at all.

I want to be clear. I’ll have about $200 left over after I pay the IRS, LDR, pay for the last prescription of the month, make the last weekly trip to the grocery, and replace the radiator in my car. It’s leaking at the top and will fail big-time soon. I’m okay for a little while adding coolant/water mix to the overflow tank when it starts getting low. I have an appointment Friday morning and will drop the car off at the shop Thursday night so they can look at it first thing in the morning and get the parts. I won’t need my car again until Sunday afternoon, so if they have to keep it overnight Friday it won’t be a problem.

Linda Alvarado loves writing about technology and science updates. She also loves to keep her mind and body fresh by doing intense workouts and meditation sessions.