The truth… about escaping the mortgage mess

It's a hard and vicious cycle with the mortgage industry hitting a depression, the housing crunch hitting everyone everywhere in very different ways. There are plenty of options out there for getting out of those sub-prime i/o arms. Yet, these options are not really available to just anyone. For these, you need to have very good credit and are only a month or two behind on the current mortgage. So for those refinancing options or working with the lender on a different pay schedule or getting a new product through your lender… you're gonna have your work cut out for you. Those government bail outs, same thing you need to have good credit or your left hanging…

For me, I'm doing a short sale. The huge problem with this is the sheer amount of time you go through and the amount of personal information they must sift through to review your financial hardships is completely invasive. You basically give them two years worth tax documents and atleast, atleast, two months of banking statements plus a letter explaining your financial hardship. It looks easier than it is. Approval can take anywhere from 6-8 weeks, that's what you're told anyways. With the amount of requests for approval of a short sale it's more like 10-12 provided they don't lose your documents and then ask for more recent information because they never received it. You end up on pins and needles because you have an offer and a projected closing date.

However, if you have a 2nd mortgage they do not start reviewing your documents until the first lender has approved, regardless of what they tell you. You can get your docs to them, they will give it a look through but for a decision making decision…. You're gonna wait as they take their time, despite knowing you have a potential closing and if you miss that and lose the offer because of that… they do not care. You'll also find that these approvals have an expiration date of either a couple weeks or if they are really one month. Eventually, maybe, you may get your approval and be all set to go but find all your offers are gone because of how long everything was taking. Short Sales on average take 9-12 for approval… It's 7 for me because I was on my realtor's ass about getting this done. I was supposed to be closed and out of my house at the end of April…then May….then everything vanished and a few weeks later get that last approval that everything was hanging on…

By this point and time, the mortgage is astronomically impossible and you just cannot pay, depending on the mortgage terms and rates. At some point it all starts caving in unless everything has gone your way. If not, you're escape options are but to leave everything behind and allow foreclosure or declare bankruptcy and still get the foreclosure. Such are the times, and even today with the bail out suggested (not a political comment) it will only help a couple hundred thousand of the millions of people affected by this mess...