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Will this work?:Buy home,quit job, get 2%/5 yr loan mod,get better job,winning!
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2011 Dec 19, 1:44am 4,995 views 6 comments
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bighorse
2011 Dec 19, 11:13am
I purchased a house before I started searching for another job. I didn't want to have to be employed for 2 years before qualifying for a mortgage. Worked out great. Superiors treat you like you are enslaved to them once they find out you took out a mortgage. Go to a new work place and keep your mouth shut about mortgages. You'll be a lot happier.
PockyClipsNow
2011 Dec 20, 7:34am
Yeah I bet they can treat people more poorly who own a home.
Pretty muh most working age owners are under water OR if they have equity dont want to sell and 'give the house away' at todays prices. Tough situation we have BUT if you are a renter this part of the credit cycle is your time and you can move for better money when others cannot.
Anyway congrats on your purchase/new job.
zzyzzx
2011 Dec 20, 9:00am
What's preventing you from claiming to be unemployed to the bank? I doubt they check to see if you are really unemployed (since they didn't bother to check if you had a job when they gave you the loan, why would they start now?).
PockyClipsNow
2011 Dec 20, 9:17am
That would make it a 'reverse liar loan' to do a 'strategic loan mod'.
Crazier and crazier!
I would like to know if that would work. I bet all manner of 'liars' are given loan mods by the hundreds of thousands. just like all free stuff the feds give of course.
toothfairy
2011 Dec 20, 9:07pm
That may be worth a shot if you can get 2% for 5 years.
quick calculation if you had a 500k mortgage @ 5% and the rate goes down to 2%
After 5 years your balance will be down to $382k
so you might not be underwater anymore.
toothfairy
2011 Dec 20, 9:09pm
What's preventing you from claiming to be unemployed to the bank? I doubt they check to see if you are really unemployed (since they didn't bother to check if you had a job when they gave you the loan, why would they start now?).
If the homeowner isn't insulted by your offer...you didn't bid low enough!!!
That will not work . They'll check your bank statements and will see that you still have plenty of money coming in.
Lets call it a 'Strategic Loan Mod'. I'm sure its a common as pie during this mess. Certainly this seems like what is happening even if you 'are laid off' or quit it simply is a 'termination' in the HR records they wont normally release whether you quit, were fired or laid off. Anyway why would a job termination being self inflicted or externally inflicted matter to 'whether you get a loan mod' its simply math at the bank. Do they hassle you about that like unemployment insurance racket?
Its also possible to do this when your wife is on maternity leave probably if you can make the mod happen before she goes back to work? I bet it is but very rare.
This is a 'keep up with the jones' plan - (they are now squating for 2 years payment free in a McMansion while u pay high rent.)
The main problem I see with this plan is this: Loan mod means non recourse purchase money loan is replaced with a 'recourse loan' type of loan so that will make it difficult to walk away scott free after the inevitable default when prices never ever recover and you have to move for work/marriage/divorce/etc. If you have higher net worth you cant declare BK. I suppose it might be better to simply not make payments for the 2 years if you know you are gonna default and you can sleep sound if you never refied/got a mod.
Lets remember it costs 7% to sell a home so you will need 7% appreciation + whatever money you throw into your ego money hole pit to break even when selling (good luck).
Anyway I'm sure lots of people think about things like 'hey im gonna quit my crappy job but I have to buy a house first so I dont get evicted for 2 years!'
(It appears that America is now that insane that you have to buy a house before you quit your job! really. To maximize the squatter stimulous.)
Has anyone done this successfully or heard of it?