Realtime advice request

[jenai]

Hello everyone. I am at the early stages of having real financial trouble and need real advice. I lost my job in July and instead of taking unemployment when offered, I took a job with big promises of huge commission. After 4 months of earning less than half of what I previously was paid, I called the unemployment office and asked if I quit that job to look for another, would I still be qualified for unemployment. The person I spoke to said yes as long as I was being paid less than I previously earned. I quit the job but was denied unemployment on the grounds that I accepted the terms of payment when I took the job.

I must add that I really do want to succeed in the field that I have been working in over the last few months but I have learned that I started at the slowest time of the year and that it may take a good six months to get to the point where I am making a decent income. With that in mind, I approached a contact in the industry who offered me a work at home position doing the same thing for a little bit more commission. I am hopeful for the future and want to make a real go at it because I am at the place in my thinking where going back into the office environment makes me ill. The daily commutes to work suck the life out of me and the office drama that seems to be everywhere has worn down my spirit. I really really need this new venture to work for me.

This is what brings me to your forum. I need real advice. I already buy generic, drive an economy car, use low energy consumption light bulbs, clip coupons etc...... I need to know how to keep my house and not ruin my life over the next few months?????

So far I have managed to make my mortgage but am slipping behind in the other areas and have just about 2K left on my credit card. My total debt is right at 8K - not including the mortgage. I doubt I can refinance as I have just owned the house 22 months - and my interest is a respectable fixed 5.75. Is there something proactive I can do now that will give me the grace period I need to establish myself in this business? I have some ideas for saving pennies but I need to reduce my overall expenses dramatically over the next three months.

I hesitate in contacting my bank without doing some research first because I don't want to alarm them until I have an idea what to expect from them. Selling the house is not a smart way out as it is a modest home and an apartment along with the moving expense would probably run the same or a little more for the first year. I am making about $800 less than I need to get by. Postponing my mortgage for about three months would take care of that deficit. Has anyone had any experience with this sort of thing?

Thank you for your suggestions.
J~

[Will]

I'm sorry to hear about the tough times Jenai.

Since you are working at home, do you think it is possible to start a small business on the side, like selling things on eBay? Have you considered renting out part of your house for extra income?

[flibberty jibbit]

Is it possible for you to work part-time 2 or 3 shifts a week? Even something like retail or wait staff would bring in extra income and even give you, possibly, a discount on items purchased.

Hope you find a solution that works for you.

~J

[jenai]

Thank you for the concern and the suggestions. I am OK with whats going on, I just really need some advice on what to expect from the bank when I call and ask if there are any programs that would allow me to postpone mortgage payments.Has anyone here gone through that with the banks?

I have been selling some used items I have via the local newspaper that allows free adds for items under $100 and have made about $600 extra doing that. However, thats sorta dried up with the holidays. I also worked for a friend one day at a trade show for a little extra cash, my dish satelite contract expires this month and I am in the middle of looking for alternatives in that area in the hopes of lowering some of my unnessecary expences.

As far as looking for part time work ....I am almost 50 years old and waited tables for about ten years in my youth and cant possibly see me being able to pull that off. I did apply for a couple of satelite call center customer service jobs where you work from home and take inbound calls in the evenings and weekends for infomercials - but so far have not been offered a position from either of those. I haven't considered retail as I have no experience but I will see about that. I would think though that they are probably letting go of loads of part timers immediately after the holidays.

I don't mean to sound negative here but I can't honestly see me being able to live with a roomate at this time. I can't see me having a stranger in my house so I am not willing to consider that as an option for me at this time - or to be honest - ever.

I think what I really wanted to get from this forum was feedback on what to expect from the bank. Does anyone here have any knowledge of what I might expect from the banks if I were to call them and ask that my mortgage be postponed or perhaps the next three payments be tacked onto the end of my loan?

Thank you again for your time and the thought you have put into your replys. I am sure something will come to mind that might be a good resource for me.

Best regards,
J~

[Julie Rains]

Just an idea but is there a way you can approach the credit card companies rather than the bank that holds your mortgage? It might be easier to get cc payments reduced (minimum payment amount reduced or interest lowered, which would also lower payments) rather than negotiate an agreement with the mortgage company. Although I have heard from credit and collections people (in general, not necessarily ones associated with mortgages) that they are usually amenable to renegotiating schedules, you do need to make sure you can meet the schedule down the road.

Here's an article about what to do if you can't meet your payment: Article: What if mortgage payments can't be met?

Also, your success may depend on whether your loan is owned by a local group or large bank/investor so I would consider that as well.

[Greg]

Jenai,

It sounds like you're dealing with the problem on two fronts -- trying to reduce your payments, and increasing your income. That sounds like a good plan.

The only thought I have is to go ahead and talk to the bank and/or CC. The worst thing they can say is "no", but that doesn't make your situation any worse.

This is just a guess on my part, but I think it's in the best interest of the mortgage and CC companies to keep you solvent so you don't totally default on the loans. It means they may be happy with a more flexible payment schedule... as long as they get their money back eventually, right?

I'm curious what others here have to say. I don't think you're alone in this situation.

Good luck. Let us know what you decide to do.

[Julie Rains]

It's a good idea to be prepared with ideas and answers for the bank. I did find another article with additional resources that may be useful: What you should do if you can't make the mortgage payment - WalletPop. There may be local resources that could be helpful as well.

[jenai]

Thank you for the article link Julie. I actually read it yesterday and thats where I came up with the decision to approach the mortgage co. I considered what you said about approaching the CC company but honestly can't see where postponing the $145 minimum CC payment would put a dent into my problem. My CC, car payment and home mortgage are all with the same bank. I would think that the $725 mortgage being deferred for three months would be all I would need to rebound and would be just ONE thing put off rather than several smaller things.

I have put a personal time limit on myself as far as giving this career change a chance. TBH I have looked at traditional jobs and will settle for one if I absolutely can not make this work but I very much want to do this and be able to work from home. The tax credits of writing off a portion of my monthly expenses (office space-phone-internet-utilities), the saved wear and tear on my car, gas, TIME (commute) and serenity are well worth the gamble if I can just figure out a way to get over this initial lag in income. BTW: I have not actually been late YET with a mortgage payment - I have managed so far - just want to be proactive before panic mode sets in.

Thanks - keep the suggestions coming - I would love to hear from someone who has actually approached the mortgage companys or banks with a request to have payments deferred and added onto the end of a loan. I like to do my homework first.

Best regards.
J~

[Beignet]

More and more people are walking from their homes.

They turn in the keys to the comany who is servicing their debt. Who actually owns your mortgage? What state are you located in? Ohio is coming to the defense of pre-forclousre home owners.

If I can find the post I will post it, but in a nutshell:

Quit paying your mortage, you can live there for free for 6 months. Most lenders will NOT work with you. Countrywide?

Save your mortage payment, put down this money on a rental HOME. There are so many wanna be Donald Trump investors that they will take almost anything to rent their investment propeties. Plus you may even get granite, granite, granite.

I've read that people can rent a home less that an apartment. They get free lawn care, pool maintenance, no taxes and all repairs are made.

Use your mortage payments for 12 months rent - up front - since you will have no credit after you get your NOD. I hope this doesn't happen, but you asked for advice and I am playing the advocate.

Keep your CC payments current. From what I'm reading in 3 years you can buy again.

I am intrigued that so many people are taking this route.

800,000 peolpe went into foreclousre in 2007.

Know you aren't alone.

I am in RE/banking, not a mortage broker or a Realtor. Banks have taken billions and billons in write downs for greedy loans that banks and low life mortage brokers forced home debtors into. They don't feel guilty. Trust me. It's the trickle down effect.

Were you put into a ARM, zero interest loan or NINJA loan?

Starting your own "home business" usally takes a few thousand to "start."

Good luck, know you aren't alone, there are millions in your shoes. I know two differnt friends who are facing foreclosures and I see empty foreclosure homes almost daily.

Good luck,

Beignet

[rolltimer]

Jenai, you won't know how the bank will respond to your request until you ask. Go in there well prepared with how you have cut your budget, how you plan to increase your income over the next few months and ask for their help. You may also check in your area for counseling services such as Consumer Credit Counseling Service where counselors will review your finances with you and help you approach your creditors with requests for reduced payments. Generally, this is a free service to the consumer.