[Soundman123]

Originally Posted by badmortgagesituation

(Soundman123's post is quite self-serving and self-centered)

Mortgage brokers, loan agents and lenders put pressure on appraisers, threatening not to hire those who could not come in at the required home value to make the loan go through. Banks began using "approved appraisers" from lists that they, themselves, compiled. That should not ever have happened. Banks/lenders should not have any type of influence over appraisers, ever. It frankly just leads to corruption.

OK, let’s do some real estate 101.

Appraisers exist to protect the bank from over lending, so that in case of foreclosure, they can re-sell the home and break even with their investment.

It is up to the bank & the buyer to accept their opinion based on similar home sales in the area.

If the bank chooses an appraiser based on his consistent over-estimation of the property, then the bank is agreeing to take a higher risk in the event of a foreclosure. They have a right to do this.

If the buyer wants to buy a home without doing their own research, (including using their own appraiser) then they are agreeing to take a higher risk that their home will sink under water.

Nobody is being scammed. It is the end responsibility of the buyer to purchase the home at market value. It is also the responsibility of the buyer to sell the home if they cannot afford it.

For some reason, nobody is taking any responsibility for anything.

[svt4cobra6]

Originally Posted by badmortgagesituation

As long as you have a tenant and can make the monthly mortgage payment (principal, interest, taxes, insurance and HOA dues, if applicable...) then you are OK. Keep it up. There is no reason to do anything yet, right? I totally understand your situation. We are losing our home because my husband lost his job, had to take a new one at 1/2 his old income because of the job situation here in southern CA. We are not deadbeats, either, we just fell on hard times and the real estate market in CA did not allow for the sale of our home because values have fallen below the mortgage balances (1st and 2nd). Hind sight is 20-20 and, of course, and looking back anyone/everyone can see where they could have made better choices along the way. (Soundman123's post is quite self-serving and self-centered as no one would choose to go through a foreclosure voluntarily and I'm sure that he would feel quite differently if he lost his job tomorrow in today's economy...) Anyway, don't default on your mortgage unless you end up being unable to pay. Don't worry about issues that have not yet occurred (like illness or repairs...) and cross that bridge when you come to it. Worrying never helps/changes anything. Poster ruready1st had a good suggestions about praying, making lifestyle cutbacks where possible and suggesting that you speak with an experienced real estate and/or BK attorney before making any big decisions. You need real information and legal advice before you decide. If you have an accountant, be sure you ask for his/her feedback regarding the tax ramifications, too.
Regarding appraisers, I know for a fact that the only appraisers that the banks and lenders use were definitely subjected to pressure throughout the loan process by loan agents, loan providers and banks into "making the deal go through". Many years ago, I was employed as a mortgage loan processor and I saw many honest appraisers lose business and suffer because they came back with an honest appraised value that would not allow a "deal" to go through. Even back then, property values were many times not meeting sale prices and that type of situation threatened many commission checks along the loan process. Mortgage brokers, loan agents and lenders put pressure on appraisers, threatening not to hire those who could not come in at the required home value to make the loan go through. Banks began using "approved appraisers" from lists that they, themselves, compiled. That should not ever have happened. Banks/lenders should not have any type of influence over appraisers, ever. It frankly just leads to corruption.

I just noticed that you originally posted back in May 2009. How are things going right now? Did you get any information that helped you in the situation? Are you still hanging in there?

thanks for the additional information, quite unfortunate what happened with the appraisers. I did not get any further info other than what people stated on the site, still hanging in there. I did end up moving from the primary house in Vegas to Calif at the end of May with a job change. At the time I had about $10,000 in savings. I decided to not just walk away from the house and it took 3 months to rent out so my 10k is now down to about 2k and I have no assests. I am able to just about break even every month, even losing $1250 a month to cover the difference on the Vegas house, now a rental. So I could just keep going as is but when the balloon payment is due (about 11 years (about 40k I think)) I will not be able to keep the house unless able to refi at that time but it is unlikely the value of the house will be below what I owe. So if the house is lost in 11 years it will be at least 170k of money down the drain, say 15k for 11 years if I am able to keep it rented and am not overburdened with repairs. Also it is not an excuse about this mess I am in but my agent that I used to purchase the house is a relative and she was sure prices would keep rising so refi would be an option.