Foreclosure in Plaza>Question Details

rubinogallery, Home Buyer in Culver City, CA

5 year loan is up. I don't qualify for refi, though I have made all payments on time and have $200K in equity. Can WF take it all?

Asked by rubinogallery, Culver City, CA Mon Aug 5, 2013

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If we’re reading your statement correctly, you're stating you have a 5 year loan, that's about mature and you have 200k in equity. Not sure how a loan modification would help, unless you're going to ask the lender to modify your 5 yr. to a 15 or 30 yr. loan. With that said we, you need a lender and unless you don't qualify for a refi. due too income to debit ratio or you’re requesting cash in you pocket, you should qualify or sell. As far as your message...there's not enough information here to give sound advice.

Call us; if we're unable to give you the sound advice you need, we will refer you to someone who can.

Susan Drew & Marie Goodloe
Keller Williams Realty Pacific Estates
2883 E. Spring St. Suite 100
Long Beach, CA 90806
Direct: 877-324-2004
0 votes Thank Flag Link Mon Aug 5, 2013
There are two types of 5 year loan.
If you have a 5 year adjustable, your current rate will go up but no more than is allowed by your yearly cap (usually) or your 1st adjustment cap (which could be pretty high).
In this case, you can continue paying the same loan, but your payment will be much higher.

If you have a balloon mortgage - 5 year fixed, then all is due at once after 5 years - it is a major problem. I suggest for you to see a couple of good mortgage people to seek their professional opinion - some mortgage brokers have a variety of products, unlike large banks. You might be able to refinance still. If you can't because of the credit issues - you can improve your credit in a few short month. If you are unemployed, call an attorney and try to work out a modification of your loan.
If you have too low equity (so your Loan to Value ratio (LTV) is too high to refi - you can pay down the loan (by cashing your 401K in, or borrowing some money to do same) and refi then.

Hard money lenders are an option that might work for some people. However, their programs are pretty dangerous - large fees, large interest rates, and also - while you really pay interest - all balance comes due at once in the end of the term, so it is also a balloon mortgage. Just be careful with those!

Hope this helps,

Irina Karan
Beachfront Reatly, Inc.
0 votes Thank Flag Link Mon Aug 5, 2013
Perhaps you can get you a "hard money loan".....These require low Low Loan to Value Ratio-60-70%...Call me at 949-610-5770. Strategically, perhaps you should downsize....Evaluate your overall situation. BTW WF may be able to foreclose.
0 votes Thank Flag Link Mon Aug 5, 2013
That's a tough question to answer without more details. I assume you had a 5 yr balloon mortgage? Depending on the terms of the loan that you agreed to, they may be able to call in the note. If you can't pay the balance then yes you are in default of the loan and they could pursue a foreclosure.

However, even under those circumstances they can't just step in and take the home. You have a redemption period once they begin foreclosure during which you can pay off the balloon payment or sell the home, pay off the note, and pocket whatever equity is left over.

So they can't just take it all. You have options. If you want to stay in the home, you can continue to pursue a refinance but if no one can refinance you then you can put the home up for sale or try and negotiate a modification with Wells to keep paying on the mortgage or convert the existing loan to a fixed rate loan.

Either way, you should hire a professional to help you negotiate things. Either a real estate attorney or realtor, depending on whether you want to stay in the home or not.

Best of luck!
0 votes Thank Flag Link Mon Aug 5, 2013
Your loan is up? Now it is a variable rate? Or now a balloon payment is due for the balance?

Why don't you qualify for a refi? A loan mod is an option, but banks have not made these easy to obtain. If you have no other good choices, then consider selling the home. Better for you to keep the equity rather than have the bank take it.

If you want a free consultation, do not hesitate to contact me directly.

Michael Magaw
0 votes Thank Flag Link Mon Aug 5, 2013
Contact a local professional lender to discuss your issue. If you are revering with WF as "Wells Fargo discuss it with them if you have not already.
0 votes Thank Flag Link Mon Aug 5, 2013
Would think another Bank would qualify you unless there is some other credit deficiency you are not mentioning.
0 votes Thank Flag Link Mon Aug 5, 2013
Why don't you qualify for a refinance?
0 votes Thank Flag Link Mon Aug 5, 2013
Yes WF can take it all. If they will not help you. Consider speaking to a Direct Money Lender. They have a number of sources for funding that may help keep you in your property.

If I can be of further assistance.

Alexander Burns
Rodriguez and Associates Real Estate
0 votes Thank Flag Link Mon Aug 5, 2013
Two possible options try a loan modification most likely you will get approve if your loan is financed by fannie mae or freddie mac. OR sell your home get the most from it and take advantage of the low prices.
Call me if you have additional questions 562-508-3148
0 votes Thank Flag Link Mon Aug 5, 2013
Hi Rubin,
I would definitely speak to your lender. and perhaps some other lenders. They may consider a loan modification, or you might qualify for a HARP2 refinance, which was set up to help homeowners with difficult loans (and who may even be upside down on their home) and does not require income qualification in most cases.
Since you may have good equity, in a addition to conventional lenders, you might want to check in with a couple of hard money lenders. They may consider loans where there is enough equity in the property. Good luck to you!
If you need any further assistance or would like to know the approximate value of your home, feel free to contact me.

Thanks, Karen McEniry, Realtor
Coldwell Banker Beachside, Realtors
(714) 343-9470
0 votes Thank Flag Link Mon Aug 5, 2013
This question really needs to be asked of your lender.
Please feel free to contact me directly if you are interested in selling the property.
Susan Bo'ur
Realtor/ Coldwell Banker
(310) 600-4240
0 votes Thank Flag Link Mon Aug 5, 2013
If your loan is maturing, you do have to pay it off or the lender can declare you in default and commence foreclosure. However, most banks do not want to do this. I would approach your lender to discuss modifying your loan to one that does not have a balloon payment.
0 votes Thank Flag Link Mon Aug 5, 2013
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