True Story of a Michigan Mortgage

In May 2006 my parents were once again threatened by the foreclosure of their home. With them living in Waterford, MI during our struggling economy this was no surprise. My father was opted to take an early buyout from General Motors but the house was already to far gone. They were at the point of having the six months before their home was completely seized or they could sell it.

My boyfriend and I were looking at getting married soon, and we discussed if there was anything we could do to help them out of this horrible situation. It was determined that we would end our lease with our apartment complex early and offer to buy their home. The real estate broker they had hired was instantly pleased at the thought and arranged for us to go through a mortgage broker she referred to many of her clients.

Shortly after she introduced us to him she left on a vacation to Florida and did not return, but did take her commission. I ended up being the sole go between for not only us as the buyers but also my parents as the sellers.

The overall arrangements of the mortgage went smoothly, he prepared documentation and was in constant contact. We need to keep the payments as low as possible because we were planning the wedding in under two years. Everything at the beginning went without to much conflict until he actual took the proposals to the bank. It was stated because my last name matched the buyers it was considered a bail out loan and would not go through.

My boyfriend and I had already alerted the apartment we were discontinuing our lease and didn't have many options left for my parent's either. So his brother agreed to be a co-signer on the lease and a roommate for the home to help with the finances because his credit did increase the overall payment of the loan. When it got down to the signing of the mortgage papers, our mortgage broker was a no show, and we soon found out why. He split the mortgage on an 80/20. The 80% was the agreed upon limit we had set for the total mortgage, but he failed to mention the additional 20% we were expected to pay.

At this point we saw no other option than agree and in a year try to re-finance, to get one mortgage company and a lower house payment. My parent's got enough out of the settlement that they were able to purchase a home outright up north, and the three of us moved in.

Two months after moving in the boy's hours were cut to 32 hours a week, no overtime, no shift premium. We began to struggle under the weight of the already to high mortgage payments, and the constantly demanding truck payments we had, not to mention all the household costs and repairs a 108 year old Michigan farm home could demand. My bi-weekly pay was being stretched to the limits in compensation of their losses.

We looked forward to March when their reviews would be in and were rewarded with 17% pay cuts but back to full time work. Our house payments began to suffer and in June of 2007 we faced foreclosure on both mortgages. We sought help from credit councilors and anyone who could help us, the overall opinion was first it wasn't my obligation, I wasn't on the home loan and second bankruptcy. The three of us were devastated at the news, we are still in our late twenties and bankruptcy or letting them take the house wasn't an option. So I went to my boss and borrowed out the money to save the home, we were put on an adjusted mortgage which moved the payments up from the nine hundred dollars we were paying overall to one thousand four hundred dollars and seventy nine dollars and some change. Since June we have been unable to catch up on our payments and have been struggling to stay within the two months behind on the 80% mortgage out of free of the imminent foreclosure that is always lurking.

Looking into mortgage companies for refinance has resulted in disappointment after heart wrenching disappointment, our credit scores have dropped to low for us to get a decent mortgage rate, we are on another adjustable arm, the delinquent payments and previous foreclosures have resulted us in a horrible re-spinning cycle of late payments and monthly deficits to which the credit councilor suggests just get second jobs, but anyone living in the state of Michigan knows having one job is luck to begin with.

With all our good intentions we got my parents out of the hardship of continuously dealing with the threat of losing their home by putting ourselves into it.
I hope by reading this it awakens an awareness to the plight that the current mortgage cycles are putting real people in.