It's kind of funny sometimes... In the aftermath of the mortgage and financial meltdown of 2008, I've realized two things: First is we reward bad behavior over and over again. The second realization? I can't catch a frigging break... The latest proof is from Bank Of America's announcement of their settlement over mortgage issues.
B of A has said they will be sending out letters to 200,000 of it's mortgage holders to reduce the principal balance of their mortgages as a penalty for foreclosing on some of it's customers. The amounts they will forgive depends, but there are no caps on the purchase amount, so they're admitting they will be subsidizing some knucklehead's McMansion..
Now, why does this bother me so much - more than the usual amount? It's because my mortgage is through Bank of America, and I would have easily qualified for assistance, with one exception - my roomie and I put paying the mortgage ontime as such a priority, that we aren't LATE ENOUGH...
We'll review for a second here. Ben and I bought our house in 2007 for $165,000 - pretty much at the top of the market, but it was still cheaper than renting. During that time, I've quit or been fired five times, and Ben lost his job twice. I'm waiting to go back to school, and he just got a job (in Pennsylvania) for minimum wage. Despite all of these mishaps, this is how many days late we've been late on the 60 payments - Zero. How? Easy, we did whatever we had to, despite both of us having car payments, credit cards, etc.. Whatever it took, including both of us selling motorcycles, pulling cash from his 401k from ten years ago, and me moving to New York for work for 2 years. You do what you have to...
Well, one of the prerequisites is that you must have been 60 days late or more as of January 1, 2012. So all we had to have done is stop making payments, like all the dummies who overbought, and we'd have gotten a major reduction on what we owe. Enough to be able to sell it now, like we've done for the past year, without an offer.. Why? Because housing values have dropped the value to $150,000, which is probably below what we owe on it...
Before I whine too much here, I will say this: I never asked for any help. If I planned on keeping the place, which is still a possibility, I'd rather get my interest rate dropped from the 6 3/8% we currently pay, to the 4% available now. That'd save us about $250 a month, but I doubt we'd get a new loan with the income instability, plus refinancing when you're selling is stupid. Nope, I am responsible for any debts I owe, and I will continue to pay them - on time. We didn't overbuy, but if we did, Bank of America would gladly be giving us tens of thousands of dollars in principal reductions. Apparently, dummies who can't live within their budgets are now deemed the same as the huge banks, like B of A - they're Too Big to Fail...
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