“Dear Homeowner, we lowered your payment” letter

[djc]

I’ll have more details on this midweek, but wanted to share this anyway…

Some friends of mine received a letter from their lender notifying them that their payment has been reduced. While I am not sure on the details of what exactly was reduced besides interest rate (they were previously locked at 5.7x), their payments dropped a sizeable about.

While I have read about this happening to “help keep people in their house” (i.e, ARM borrowers, people behind on payments etc), I hadn’t heard about this happening to people who are in good standing with their mortgage. The owners are well funded have a 30y/f, pay on time, never behind, etc.

Are lenders just cutting loans now? I knew BofA had some lawsuit to settle with CA, but these friends are not with them. They had asked if I had heard about this and the only cases I could recall were ones not in good standing.

Should I buy my 800k La Costa house and expect a letter in a year cutting my payment? 🙂

[Coronita]

I wish I could threaten to sue to have my principle or loan payment lowered. Sue for being overly responsible.

[Coronita]

I wish I could threaten to sue to have my principle or loan payment lowered. Sue for being overly responsible.

[Coronita]

I wish I could threaten to sue to have my principle or loan payment lowered. Sue for being overly responsible.

[Coronita]

I wish I could threaten to sue to have my principle or loan payment lowered. Sue for being overly responsible.

[Coronita]

I wish I could threaten to sue to have my principle or loan payment lowered. Sue for being overly responsible.

[SD Realtor]

DJC you cannot open that box…

You see this issue extends to the greater moral hazard that is not only being ignored by the government, but so far by courts. I cannot believe we will not see cases cropping up soon.

Seriously what will happen when thousands, or shall I say tens of thousands of people receive such treatment. Maybe even hundreds of thousands? Who makes the choice? Who makes the rules? When the first lawsuits come, and they will… how will courts rule? Because if courts side with the first plaintiffs that get pissed of because the neighbor next door received a rework and principal reduction while he did not then it seems to me the entire bailout will be jeopardized.

I have already seen a few situations of interest rate reworks but no principal reductions yet.

However it is arguable that even these sort of reworks create a potential source for litigation don’t they?

[SD Realtor]

DJC you cannot open that box…

You see this issue extends to the greater moral hazard that is not only being ignored by the government, but so far by courts. I cannot believe we will not see cases cropping up soon.

Seriously what will happen when thousands, or shall I say tens of thousands of people receive such treatment. Maybe even hundreds of thousands? Who makes the choice? Who makes the rules? When the first lawsuits come, and they will… how will courts rule? Because if courts side with the first plaintiffs that get pissed of because the neighbor next door received a rework and principal reduction while he did not then it seems to me the entire bailout will be jeopardized.

I have already seen a few situations of interest rate reworks but no principal reductions yet.

However it is arguable that even these sort of reworks create a potential source for litigation don’t they?

[SD Realtor]

DJC you cannot open that box…

You see this issue extends to the greater moral hazard that is not only being ignored by the government, but so far by courts. I cannot believe we will not see cases cropping up soon.

Seriously what will happen when thousands, or shall I say tens of thousands of people receive such treatment. Maybe even hundreds of thousands? Who makes the choice? Who makes the rules? When the first lawsuits come, and they will… how will courts rule? Because if courts side with the first plaintiffs that get pissed of because the neighbor next door received a rework and principal reduction while he did not then it seems to me the entire bailout will be jeopardized.

I have already seen a few situations of interest rate reworks but no principal reductions yet.

However it is arguable that even these sort of reworks create a potential source for litigation don’t they?

[SD Realtor]

DJC you cannot open that box…

You see this issue extends to the greater moral hazard that is not only being ignored by the government, but so far by courts. I cannot believe we will not see cases cropping up soon.

Seriously what will happen when thousands, or shall I say tens of thousands of people receive such treatment. Maybe even hundreds of thousands? Who makes the choice? Who makes the rules? When the first lawsuits come, and they will… how will courts rule? Because if courts side with the first plaintiffs that get pissed of because the neighbor next door received a rework and principal reduction while he did not then it seems to me the entire bailout will be jeopardized.

I have already seen a few situations of interest rate reworks but no principal reductions yet.

However it is arguable that even these sort of reworks create a potential source for litigation don’t they?

[SD Realtor]

DJC you cannot open that box…

You see this issue extends to the greater moral hazard that is not only being ignored by the government, but so far by courts. I cannot believe we will not see cases cropping up soon.

Seriously what will happen when thousands, or shall I say tens of thousands of people receive such treatment. Maybe even hundreds of thousands? Who makes the choice? Who makes the rules? When the first lawsuits come, and they will… how will courts rule? Because if courts side with the first plaintiffs that get pissed of because the neighbor next door received a rework and principal reduction while he did not then it seems to me the entire bailout will be jeopardized.

I have already seen a few situations of interest rate reworks but no principal reductions yet.

However it is arguable that even these sort of reworks create a potential source for litigation don’t they?

[SDowner]

I cannot believe this. Responsibility is being punished while people who are not are rewarded. This will only encourage further deliquency in payments.

Okay, now I need to know how to divert my cash reserves and default on a recourse loan without if affecting my assets.

[SDowner]

I cannot believe this. Responsibility is being punished while people who are not are rewarded. This will only encourage further deliquency in payments.

Okay, now I need to know how to divert my cash reserves and default on a recourse loan without if affecting my assets.

[SDowner]

I cannot believe this. Responsibility is being punished while people who are not are rewarded. This will only encourage further deliquency in payments.

Okay, now I need to know how to divert my cash reserves and default on a recourse loan without if affecting my assets.

[SDowner]

I cannot believe this. Responsibility is being punished while people who are not are rewarded. This will only encourage further deliquency in payments.

Okay, now I need to know how to divert my cash reserves and default on a recourse loan without if affecting my assets.

[Author]

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