Harp Refinance - Greentree Second Mortgage Subordination

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DanielaR

LoanSafe Member
Jul 19, 2013
9
0
0
Upstate NY
I just got divorced a few months ago and am looking to refinance the house into just my name. I originally did the 80/20 split. After a month with the original lender (HSBC, I think) i got sold to country wide, then then to Bank of America, and then the 20 went to Green Tree last year, the 80 to NationStar a few months ago.

I applied with my credit union and basically I am too upside down for a conventional loan - but I am eligible for HARP. I started the process in May and have a rate lock that expires on Aug 5 (for 3.5%). The original subordination request was denied because I am at 112% loan to value and GreenTree only likes 104%. But I just looked at the subordination paperwork and that seems to be for regular loans - not HARP. But the credit union says that what GreenTree is really wanting is updated paperwork - since the stuff they submitted was for May and it is now two months later. They had all the new info as of Monday, but as of 10:00 am today (when I called) they still haven't submitted to GreenTree - the underwriter has to do something and she thinks it will be submitted by the end of the day.

Considering GreenTree says turnaround time of 10 - 15 business days does this mean I am pretty much out of luck? And I will need to try again under the 4.5% rate? Or since I am still off from the 104% I should just let it go for now and wait until I paid more off?

The divorce is an issue - I can't really afford the home under the current plan by myself for long - i am digging into savings now. The original plan was to refinance the 80% under HARP, then wait a few months and refinance the 20% - my credit union will let me borrow up to 100% of the value of the home that way and I was going to take a 401K loan out to pay the difference (which isn't really that much right now). That would save me about $700 a month.

I also have a lot of credit card debt - I was looking into a debt consolidation loan a few weeks ago, just to see what my options are. I didn't take any out or even apply for them - just did that Lending Tree send me your offers thing. (and all the loans were for more then my interest rate on the cards so wouldn't even be worth thinking about). I am not sure if that makes a difference but it does mean that if I can't refinance bankruptcy really is a serious thought right now. My ex doesn't have a job so all the stuff in both of our names that he was supposed to take are still in both of our names since who would refinance a loan into the name of someone without a job?

Any advice is wanted and needed.

I admit I am know I have 2 weeks to go but I am already starting to panic at the thought of none of this going through.

Daniela
 
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Evan Bedard

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The divorce is an issue - I can't really afford the home under the current plan by myself for long - i am digging into savings now. The original plan was to refinance the 80% under HARP, then wait a few months and refinance the 20% - my credit union will let me borrow up to 100% of the value of the home that way and I was going to take a 401K loan out to pay the difference (which isn't really that much right now). That would save me about $700 a month.

I also have a lot of credit card debt - I was looking into a debt consolidation loan a few weeks ago, just to see what my options are. I didn't take any out or even apply for them - just did that Lending Tree send me your offers thing. (and all the loans were for more then my interest rate on the cards so wouldn't even be worth thinking about). I am not sure if that makes a difference but it does mean that if I can't refinance bankruptcy really is a serious thought right now. My ex doesn't have a job so all the stuff in both of our names that he was supposed to take are still in both of our names since who would refinance a loan into the name of someone without a job?
Welcome and thanks for joining the community Daniela.

Just wanted to chime in and give you a few things to think about before making your next move. IMHO you really need to think about your long-term financial goals and not let the stress of the divorce make decisions for you. Think about whether or not you have the means to afford the home for years to come if you are able to achieve an interest rate in the mid 4 percent range, let alone a few grand in closing costs.. With a significant amount of credit card debt - do you really want to take out another loan and drain your 401k to keep the property? I'm not trying to be negative here, but we have hundreds (if not thousands) of members who have been in the exact position you are in now.. Consider what is best for you in the long run, is it keeping the home and doing what it takes to make the payment - or are you in a position where bk is inevitable to wipe out the cc debt, include the mortgages, and walk away to find somewhere more affordable...
 

DanielaR

LoanSafe Member
Jul 19, 2013
9
0
0
Upstate NY
Welcome and thanks for joining the community Daniela.

Just wanted to chime in and give you a few things to think about before making your next move. IMHO you really need to think about your long-term financial goals and not let the stress of the divorce make decisions for you. Think about whether or not you have the means to afford the home for years to come if you are able to achieve an interest rate in the mid 4 percent range, let alone a few grand in closing costs.. With a significant amount of credit card debt - do you really want to take out another loan and drain your 401k to keep the property? I'm not trying to be negative here, but we have hundreds (if not thousands) of members who have been in the exact position you are in now.. Consider what is best for you in the long run, is it keeping the home and doing what it takes to make the payment - or are you in a position where bk is inevitable to wipe out the cc debt, include the mortgages, and walk away to find somewhere more affordable...
Hi - those are some good questions. The closing costs for the HARP loan will be rolled into the mortgage, so I don't have to come up with that money up front. And the loan from my 401K is only $15,000 - so not that much. I did look into it and I can swing things (it will be a little tight for a bit) if I can get both the first and the second to be refinanced. Moving to 4.5 will mean about $100 more a month - which is doable but not as happily as the 3.5 - which is why I am hoping that I still have a shot at the 3.5.

I have thought of just walking away from the house, but I also have several pets and if I were to go to an apartment that fits my needs I would be paying just about the same as the refinanced mortgage - at which point moving away seems like a waste. I will admit I am thinking of filing for BK after the refinance - if I could get rid of the unsecured debt then keeping the house wouldn't be an issue at all. Right now it is the high mortgage and the unsecured debt that is the problem. If I could get rid of one the other wouldn't be an issue. Once the refinance is done I will be barely breaking even - a disaster would wipe me out. So I am thinking of BK just to prevent that. But on the other hand I am eligible for a raise this year too and those are in Oct so I am hoping if i can just hold on until then that things might work out.
 

Evan Bedard

Call 1-800-779-4547
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Aug 26, 2007
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I have thought of just walking away from the house, but I also have several pets and if I were to go to an apartment that fits my needs I would be paying just about the same as the refinanced mortgage - at which point moving away seems like a waste. I will admit I am thinking of filing for BK after the refinance - if I could get rid of the unsecured debt then keeping the house wouldn't be an issue at all. Right now it is the high mortgage and the unsecured debt that is the problem. If I could get rid of one the other wouldn't be an issue. Once the refinance is done I will be barely breaking even - a disaster would wipe me out. So I am thinking of BK just to prevent that. But on the other hand I am eligible for a raise this year too and those are in Oct so I am hoping if i can just hold on until then that things might work out.
You seem to have thoroughly explored every route available at this time and you may be in a financially stable position once you are able to wipe out the unsecured debt.

I'm not sure if you were referring to consolidating the 1st and 2nd lien through HARP..

http://www.loansafe.org/forum/refinance/48248-harp-most-commonly-asked-questions-answered.html

Can I consolidate both my 1[SUP]st[/SUP] and 2[SUP]nd[/SUP] mortgage?

No, consolidation of a 1[SUP]st[/SUP] and 2[SUP]nd[/SUP] would be considered a cash out refinance and this transaction is not eligible for underwater borrowers under HARP. The 2[SUP]nd[/SUP] mortgage will have to be subordinated (agree to stay second position.)
 

DanielaR

LoanSafe Member
Jul 19, 2013
9
0
0
Upstate NY
You seem to have thoroughly explored the route available at this time and you may be in a financially stable position once you are able to wipe out the unsecured debt.

I'm not sure if you were referring to consolidating the 1st and 2nd lien through HARP..

http://www.loansafe.org/forum/refinance/48248-harp-most-commonly-asked-questions-answered.html

Can I consolidate both my 1[SUP]st[/SUP] and 2[SUP]nd[/SUP] mortgage?

No, consolidation of a 1[SUP]st[/SUP] and 2[SUP]nd[/SUP] would be considered a cash out refinance and this transaction is not eligible for underwater borrowers under HARP. The 2[SUP]nd[/SUP] mortgage will have to be subordinated (agree to stay second position.)

I did try to see if I could consolidate both loans but I am not eligible for that - probably because I am upside down on the house. So they are going to refinance the first through HARP and then I was going to do the second as a separate loan. I really would like to get out from under both GreenTree and NationStar if possible.

My main concern is whether GreenTree would actually subordinate their loan and if so whether they would do it in the time frame needed. I don't have much hope of that happening, but I am hoping that since there are so many members here with more experience they might have some insight into that. I still haven't heard from my bank so for all I know they haven't submitted it yet either. Which makes me wonder if they are holding off because they know the time frame is short and thus I will lose out and have to go with the higher rate. If I do lose out because of GreenTree coming back so late would I even be allowed to try again? Or would I have to wait a while for that?
 

Evan Bedard

Call 1-800-779-4547
Loan Safe Mortgage
Aug 26, 2007
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48
San Diego, California
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Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Jan 14, 2011
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Hi Team,
I would like to speak from experience with GreenTree and the subordination process, they are a bit lengthy and you need to make sure the starting loan amount is exact when submitting the subordination. They are willing to do them as it decreases the risk of future default for the borrower. Like Evan said, there turn times are much longer than other banks and usually around 30 days. If you're locking your rate in, make sure to lock it on a longer time period or just don't lock it at all until the subordination has been received back. These are some things that I instruct my borrowers with and I believe the subordination fee with GreenTree is 200.00.

Regarding the second mortgage, HARP does not allow "Cash Out" refinances and this is what that would be called because you're basically pulling cash out to pay off the second loan. The only way to make this happen is if you #1 fit the criteria (LTV, DTI...ETC) for a conventional loan and you have the equity to do so.

You should be speaking with your loan officer regarding this and make sure you're protected from any increases. We have also been seeing a small decrease in rates over the past couple days which is nice. There has been talks about keeping interest rates low because with the recent increase it has caused the application count to go down about 25-50% across the board. Hope this helps and if you have any more questions you're more than welcome to ask!
 

DanielaR

LoanSafe Member
Jul 19, 2013
9
0
0
Upstate NY
Chances are that Green Tree will be willing to subordinate, unfortunately though it seems they charge high fees and the turn around time is about 30 days. Here's another member who was in a similar situation as yourself with GT..

http://www.loansafe.org/forum/harp-mortgage-loan-program/83434-harp-refi-green-tree-they-hold-both-my-1st-2nd-am-i-outta-luck.html


Thanks for the link - I will definately be reading that. Unfortunately my loan officer seems to have disappeared. I have left messages but none have been returned and she is apparently "working downstairs" this week and won't be back until Friday. I have no idea what "working downstairs" means or why that means she can't get in touch with the people she has been working with for 90 days.

I have extended the lock for as long as possible and it expires on Monday. I have emailed with someone (the person who I put in the application with originally - not sure what the term is) and he said he discussed with management and since there were internal delays they will extend the lock - but they didn't say for how long and the lady I talked today didn't seem to know about it.

Apparently the subordination was submitted on the 19th - the original one that was rejected was submitted on the 27th of June and rejected by July 12 (can't remember the exact date). The fee ($125) was withdrawn immediately on June 27 (which is how I know that date offhand) but no new fee has been withdrawn - maybe because it is just a resubmit?

I am kinda nervous about the entire thing - especially because noone seems to be communicating with me anymore. I am also wondering about this month's payment. Will that change the loan amount meaning I have to go through this entire process all over again? I do have some grace period to pay the loan - I just don't want to screw myself over either way.

I wish this weren't such a black box process and I had more of an idea of what is actually going on and what my options are. If the subordination is late can I start over immediately or do I have to wait? I guess I will find out more on Friday.

Daniela
 

yadfgp

LoanSafe Member
Dec 17, 2009
38
0
0
Hi DanielaR :)

I just noticed this thread as you had just replied to 1 of my many threads in regards to my many nightmares I've been having trying to get a HARP refi.

That link that Evan posted is 1 of my many threads I've posted across the web these last 6 months or so.

I can give you a quick tip that may help put your mind at ease or hopefully at ease at least.

During my long long HARP refi nightmare, courtesy of that %@#$#@!$#@ company Green Tree, I came across an individual who actually used to work in subordinations department at Green Tree. She just recently quit there a couple of months for obvious reasons! THEY **** AND THEY'RE INCOMPETENT CROOKS!!!!

So I was able to communicate to her online and she was able to help me with some questions on Green Tree and especially on subordinations.

Just to give you a really short story and not go into all my details, Green Tree holds both the 1st and 2nd on my primary home. I am as you may know, looking into doing a HARP refi within the next 5 months or so. I am having to go through someone other than Green Tree.

I am of course, worried that if I am able to get a HARP refi on my home, being denied by Green Tree on my 2nd, since it would mean they would no longer service my 1st anymore. So I asked my new contact. My contact told me I shouldn't have anything to worry about. She said though that it can take some time for them to complete any subordination requests though. Cuz they're idiots I guess?

I didn't ask her too many other questions though as I didn't want to bother her to much, as I'm sure she's probably trying to forget she ever worked at that hell hole.

I'm sorry I don't really know any other specific details that apply to your unique situation. She did tell me though that they do put pretty much all subordination requests through. She said she did quite a few of em in her time working there.
 
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DanielaR

LoanSafe Member
Jul 19, 2013
9
0
0
Upstate NY
So it sounds like I should be okay as long as my bank is willing to wait a bit. I got an email today saying that my rate is expiring soon and what do I want to do about it, and someone emailed back that since there were internal delays they would be honoring my rate lock. but they didn't specify for how long. So I guess I am back at the waiting game. Which really ****s. Patience is not something I am good at!

Daniela
 

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Jan 14, 2011
2,113
182
63
San Diego, California
www.loansreduced.com
Thanks yadfgp for sharing the info you received. I have done many subordinations with GreenTree and you're absolutely correct, they have approved every one submitted (as long as the new loan amount doesn't change) but do take their sweet time on it which is why you want to be aware of that when locking your new rate in. The only time I've had an issue with a subordination was with Bank of America where it was a CalSTRS backed second mortgage which was required to be paid off if the first mortgage was paid off. Bank of America was gracious enough to refund the cost of the application to the borrower. If you're benefiting your scenario (ie: lowering your payment) the bank looks at that and see's you would have more available to put towards the second to pay them off.

You should be ok DanielaR if they're going to extend your lock but make sure they do, interest rates have been consistently rising over the past 6-7 months and you don't want to lose out on what you have now.
 

DanielaR

LoanSafe Member
Jul 19, 2013
9
0
0
Upstate NY
Thanks yadfgp for sharing the info you received. I have done many subordinations with GreenTree and you're absolutely correct, they have approved every one submitted (as long as the new loan amount doesn't change) but do take their sweet time on it which is why you want to be aware of that when locking your new rate in..

You should be ok DanielaR if they're going to extend your lock but make sure they do, interest rates have been consistently rising over the past 6-7 months and you don't want to lose out on what you have now.
SO what concerns me is that this is the first of the month, my mortgage payment is due. I sent the check - so does that mean my loan amount will change? And so I am out of luck? Or is this one of those grey areas?

I think something went down at my bank because today I got an email saying that my rate lock was about to expire and then the person I talked to when all this started (the originator?) sent an email saying that because of internal delays my lock would be honored. And that was it - no how long it would be honored or anything like that. I am not going to push it - because if it is indefinite I would rather not force a number on them.

I can't wait for this process to be over.

Daniela
 

yadfgp

LoanSafe Member
Dec 17, 2009
38
0
0
Anything new to report?

Also I see that you have alot of debt. I'm sorry about that. I hope you are able to get out of this mess.

Do you mind if I ask you what your DTI ratio is when you try and do your HARP refi?

As you may recall, that's been my only problem with being able to get a HARP refi done. I currently have a DTI of around 70 percent. :(

Thanks
 

DanielaR

LoanSafe Member
Jul 19, 2013
9
0
0
Upstate NY
Anything new to report?

Also I see that you have alot of debt. I'm sorry about that. I hope you are able to get out of this mess.

Do you mind if I ask you what your DTI ratio is when you try and do your HARP refi?

As you may recall, that's been my only problem with being able to get a HARP refi done. I currently have a DTI of around 70 percent. :(

Thanks
I have great news! everything worked out! The subordination came in last monday (the 5th) and I closed right on the wire - I had to close by the 9th and I did. Pretty much everything that could go wrong did go wrong and I am still wondering if another shoe will drop but at least this is done and I can go on to worry about other things.

My DTI ration is pretty high - including the morgage stuff it was around 75 percent.
 

TomEason

LoanSafe Guide
Jun 18, 2009
12,390
85
48
SF Bay Area CA
Hi DanielaR

I have great news! everything worked out! The subordination came in last monday (the 5th) and I closed right on the wire - I had to close by the 9th and I did. Pretty much everything that could go wrong did go wrong and I am still wondering if another shoe will drop but at least this is done and I can go on to worry about other things. My DTI ration is pretty high - including the morgage stuff it was around 75 percent.
Congratulations for having complted your refi - good job! And thanks for sharing your saga here.
 

Evan Bedard

Call 1-800-779-4547
Loan Safe Mortgage
Aug 26, 2007
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48
San Diego, California
www.LoanSafe.org
That's great news you were able to secure the refinance! Now that you got the refinance out of the way you can go ahead and start working on lowering your overall DTI, 75 percent is extremely high for ANYONE to manage!!
 

yadfgp

LoanSafe Member
Dec 17, 2009
38
0
0
Congrats!

That's AWESOME NEWS! :)

But what the hell????

How is it that you were able to do a HARP refi with a DTI of 75 percent when I've been turned down from 4 different places with a DTI of 70 percent?

I just don't understand that. MY LTV is only around 95 percent or so. All my debt will be paid off in a few more months.

I haven't tried going through a credit union.

Maybe that's what I need to do.

Do you mind if I ask you 1 more question, and what credit union did you go through?

Thanks and again congratulations! :)