Defaulting on mortgage to get a lower interest rate?
jsb5115 asked:
I am one of many who lost there job and or spouse that has or both. In my case my wife lost hers and living in a two income state of California my first question to myself was “how do we pay the Mortgage?”. After running the numbers, we are able to stay afloat on my income and my wife’s unemployment but there’s a catch. Our mortgage interest rate will have to go from 7% down to 4%. Does anyone know what the process is for asking for a lower interest rate?
1. Do I default now on the mortgage?
2. Do I give the mortgage company a couple hundred dollars showing that I am trying to pay back by debt?
3. Do I call the mortgage company and ask for 4% since that’s what I can afford? (before defaulting or after defaulting?)
I am one of many who lost there job and or spouse that has or both. In my case my wife lost hers and living in a two income state of California my first question to myself was “how do we pay the Mortgage?”. After running the numbers, we are able to stay afloat on my income and my wife’s unemployment but there’s a catch. Our mortgage interest rate will have to go from 7% down to 4%. Does anyone know what the process is for asking for a lower interest rate?
1. Do I default now on the mortgage?
2. Do I give the mortgage company a couple hundred dollars showing that I am trying to pay back by debt?
3. Do I call the mortgage company and ask for 4% since that’s what I can afford? (before defaulting or after defaulting?)
Thanks
Corey
May 14th, 2009 at 12:52 am
Helen
I don’t think default is a good idea. If you call your company and explain the situation, they will probably work with you.
May 14th, 2009 at 6:34 pm
April
you need to seek a mortgage loan modification but the bank may not grant it as there are not any 4% rates today
May 15th, 2009 at 6:06 am
Lorraine
Do not default, refinance your house.
May 17th, 2009 at 3:33 am
Lance
Defaulting on the mortgage will have an adverse effect causing you to become ineligible for the lower interest rate, which is typically reserved for those with the most pristine credit scores.
A default will send your credit score plundering.
Call first!
May 18th, 2009 at 7:47 am
Carolyn
Do
not
Default
Call your lender and ask for a few months off. They may go for this.