Complaint Review: Countrywide Home Loans

It all started back in 2006. We were so excited to finally be building our own home and were set up to have a fixed rate in the 6% range. Everything was going really good until I ended up losing my job due to the company outsourcing to India. I ended up being one of the 200 people that were laid off indefinitely. Countrywide said since we were closing in August we should be ok and they wouldn't need to pull our credit report again. As anyone knows when building a house there are always unexpected costs.

Needless to say, we ended up having to use a couple credit cards to be able to buy some of the needed items to finish building the house. (Such as toilet, sink etc. NOT FURNITURE OR ITEMS TO DRESS THE HOUSE UP) At the end of July it came time for the appraisal and the appraisal company, which was LandSafe. (I would HIGHLY recommend not going through them) The appraisal man came out, I believe his name was Greg, and he said the bathroom needed to be cleaned out. (We had two buckets on the floor) I asked him if everything else was ok and he said yes. He said his next available appt was 10 days away. So we cleaned up the bathroom and double checked everything else.

By this time it was beginning of August and we were supposed to close in two weeks. The appraisal man came back and looked over everything and said the bathroom looked good, but we needed something done to the back of the house. I asked him why he didn't tell us that the last time and he basically blew off my question. He said he would be back in 10 more days. I asked him again to look over everything and make sure that was the only thing that needed done. He looked and said that should take care of everything.

We fixed what he asked us to fix and he came back 10 days later and said we had to have grass seed spread and hay put over it before he could approve it. I was extremely upset at this!!!!! I told him we would have that done in two days and we wanted him to come back in two days to look at it since he couldn't let us know EVERYTHING that needed done the first time he came out. He said he couldn't come back in two days and it would be another 10 days before he could make it back. The next time he came back he found something else to complain about and finally 10 days after that last complaint he approved it.

This ended up taking us into September and countrywide pulled our credit report again. Our credit score had gone down because of the credit cards we had to use to buy necessary items for the house and we had to buy the items the appraisal person said we needed. (Grass seed it expensive and when you have to purchase enough to do 1 and 1/2 acres it will end up costing at least $300) We did not have the money left in our loan to do this either so the credit cards ended up being maxed out.

This hurt our credit, plus me losing my job did not help. I was with my employer for 9 years when I lost my job and when they seen that I did not have a job and I was unemployed our interest rate went up. Our total house payment went up over $300, which we could not afford and in order to get into our home we were left with no choice but to sign a 2 year ARM. It was either that or not have the house we just finished building. I wasn't able to find another job for 5 months and our bills ended up being late.

Once I found a job we worked hard to make sure our bills were paid off. Of course it took us almost a year to make sure this was done. Also in the middle of all of this I decided to go back to school to become an rn. I've finished the first two years and still have 2 years to go, but now they are saying the student loans are hurting my credit score and countrywide said they will not be able to put us into a fixed loan. Now we are having to check with other companies to try to get refinanced because with the ARM we really will not be able to afford it if our house payment goes up again.

When we were going through the appraisal phase we did ask countrywide to use another appriasor because we were not happy with the one we had. Their response was they only use LandSafe. To me this is Countrywide's fault that we were left with no choice but to go into a 2 yr arm because if the appraisor THEY sent to look over our house, would have let us know EVERYTHING that needed to be fixed (THE FIRST TIME) we would have been able to lock into a fixed rate and our house payment would have been in the range where we wouldn't have been struggling.

The appraisor also charged a fee each time he came out and instead of having a $200 fee we ended up with a $1000 fee for appraisal. The appraisor also did not appraise our house correctly because he documented that we had a propane heater, which isn't correct because we have a heat pump, which increases the value of our home. We asked about this and they said they could send him back out for another fee. Needless to say, after seeing that man 5 times I did not want him anywhere near my house!!!!!!

I am not saying that all the Mortgage companies do not have some fault here, but as consumers we should have the brains to:

1. look at our debt and to have it PAID off or at least have very little. That doesn't mean to take out another loan to pay off debt, that doesnt pay it off, only puts you futher into debt, as you have discoverd. You should have waited until your debt to income ratio was nothing or at least extremely low and NOT attatched more debt to your home. That is the biggest reason people are in a mess. Yes the mortgage companies allowed it, however, the responsiblity relies with us.WE as humans make our own decisions. Countrywide did not sit at the table and hold a gun to anyones head in order for you to buy a home.

2. we should look around and find the best deal.We need to look at our income and stay within the 25% of what we make a year and not get so excited to think that we can afford that bigger , nicer home down the block or in the next larger subdivision. We have to own our part in this. Perhaps that means waiting till next year to buy that pretty house, but as adults sometimes we have to say "NO" to what we want. I myself waited 11 years, bought a small house with a huge yard. I love it, we have been here 14 yrs and do not plan on going anywhere. Sure, I would love that newer, nicer, spiffer home in the area a mile down the road, but I know it would strap our budget.

3.Budget...........hmm that nasty word people hate. Cut up credit cards, pay off car payments before buying that house. That way should something happen like someone getting ill, a surgery, something out of the blue like a job layoff, you are not in such dire straights. Stop living like the Jones, believe me, they may have all the "cool" things, but those cool things may be in forclousure or the cars may be ready to be repoed.

When this began a couple years ago I knew then we were ready for a down fall.Why? Because I saw people doing stupid things like taking out the 80/20 loans. Having 0 down payment, exactly what did they think would happen ? Adjustable rate mortgages, our interest rates were an all time low. When they adjust where did you think they would adjust to??

I hate seeing this because I know how hard it is to make it. I personally have had 45 major surgeries, so yes I know ALL about hardhsip. I made sure that I bought a home that wasnt over 25% of my income, without saddled with debt, car payments and we have never bought a house full of new furniture.

When I drive by and inspect a house that is behind, I see 2 new suv in the drives, furniture out of Rooms to be broke, I see the latest toys for kids in the yard etc... Sometimes I see people who bought the 500k house, yet they can't buy living room furniture because they spent it all on the house. I also see low income houses that is worth perhaps 40k and they have a new 40k giant suv in the driveway. So, yes, I think we all need to look within our selves and say hey , what did I do wrong? What should I have done as a consumer differently.

Always know what you are buying. They don't just "change" your loan from a fixed to an adjustable. Something is not right there. I do not know if you did't take the time to know what you bought, I do not know if you did not put a good solid down payment down, I doubt that since you said you needed to pay off debt. We all as consumers have to stop blaming the mortgage companies and look at what we did. We wanted the house and you signed the papers. You could have waited til your debt was paid off or you could have bought a smaller house. Yes I know people do not like to hear this, but everyone seems to act as though we had a gun to our head and that is just not the case. Our job is to take responsiblity and say "no", I can not afford it yet.

I watch the tv shows on tv and 9 times out of 10 the realtor will push a house that is over their budget. The buyers need to say "NO,I can not afford it now". We have the power. We are not victims, we can say "No". I know this wont be popular here, but that is ok. In the meantime I will be the one having to drive by the house in forclousure, making sure when it is vacant it has not been vandalized and when it has, I will have to document the damages. The ironic thing is when I drive by I will also be checking on that suv that is behind on as well. Come on folks , wake up. The choices are yours. It is commen sense. Surely some of you guys have it!

I work for Wilshire Credit Corporation and while we may have 96 reports on this site it is sure not over 400 I am sickened by how many people are losing their homes due to adjustalbe rate nightmares. While I do agree that people need to read what they signed...the majority did but no one saw the market taking such a dive. The majority of people that we do modifications for are always on time and have good credit, the problem is their home is not worth as much as they paid and they cant refinance. There used to be a time when people had to have good credit to get an adjustable rate but in past years they were given to anyone and everyone. I can say this...at least we are helping people in this crisis and doing everything we can to keep them in their home not out of it. It makes no sense for people to have to be behind in order to get help, most people know they are going to have a hardship ahead of time and try to fix it before it really hits the fan.

One thing to keep in mind is a lot of people trusted their mortgage company and did not read all the paperwork all the fine print, there are so many papers to sign and you just want it over with. It is such a long and tiring process. You would think you would be able to trust the person with the biggest purchase in your life. It is easy to tell people they should have read their contract but they already know that and don't need to feel worse. Don't pass judgment so easily.

I pray for people to be able to make it through this hard time every day. I care so much for people and wish I could just fix everything but I am not God I am just one person who cares and I am blessed that I have a great job and a fixed rate! :)

Good luck to everyone who is having a hardship and don't give up!

We too have an ARM. We have never been late or missed a payment. I don't want anything from Countrywide other than common courtesy. Just adjust our terms and let me continue paying my $4500.00 + a month. Why not help those of us who are on time and sending them our money each month. I' m not saying we weren't foolish in getting into this kind of loan. I cannot understand why Countrywide would not jump at the chance to work with anyone willing to make their payments on time. It appears that they won't really help unless you fall behind, that's so stupid.

They have a HOPE line, that's a hoot you can't get past the kids working in customer service. I furnised them with the budget the letter and everyting else they wanted and keep being told to call back. For those of you out there in my shoes my heart goes out to you. For those of you out there sticking up for Countrywide, think twice before you get so self righteous and start passing judgement on those of us that thought we would be able to re-fi out of these crappy loans. No one could forsee the future, if we could none of us would have signed those loan docs. As for now we just keep calling and at some point stop making our payments. Hopefully someone will rent to us after Countrywide gets our houses back.

You may still have a fixed interest rate loan. It appears to me that your newly "refunded" loan may include additionaly interest and fees/penalties from the original loan plus the principal amount. This would result in a higher monthly payment by you to make up the arrears and get your loan back on schedule.

I agree with John. You need to gather copies of all your loan papers and READ them thoroughly. It doesn't appear you have done this-even now.

I know that when I first started out I had Washington Mutual and it was a 30 year fixed. When they started losing payments the VA did a refunded loan they said they would take it over and the payment would come out of my check but they gave the loan to Countrywide . I did not get all of the paper work. They did what ever they wanted with my loan and the VA didn't say or do anything. I know i started off with a 30 year fixed and when it was over my payment went up quite a bit like an arm.

'started off with a Fixed rate loan and I think Countrywide decided to change it to an ARM without my permission, My payment went up quite a bit .'

What do you mean 'I think countrywide decided'? What does your paperwork say? This is why you have problems. You clearly never read it yet.

I started off with a Fixed rate loan and I think Countrywide decided to change it to an ARM without my permission, My payment went up quite a bit . So would like it if you weren't so defensive toward Countrywide because they do illegal things within the company, why do you think some exemployees are speaking out against them. I personaly am going to post signs outside of their businesses so people will think twice about using their services. I will also run Bank of America into the ground for buying them out. They are as crooked as Countrywide. Countrywide caused me to lose my home and my reputation and I will never forget or forgive them for what they did to me. I intend to ruin them. Some people where I live have already stormed into one of Countrywide business yelling and protesting them. I am not going to just talk about it i am going to follow through with it.They have to be stopped. People should jump into action and stand up for themselves and stop this company from hurting other people. Don't just sit around and do nothing. Fight for your rights, They don't have a right to Rip people off.

Why is it when people run up debt, buy horrible ARM loans , run up more debt probably buying furniture for the homes, using credit cards and not cash, then they are mad at the mortgage company because their debt to income ratio is too high? Why is that Countrywides fault? Anyone with half a brain knows that an ARM is a way to take out a mortgage on a house that IS NOT with in their means. The pre payment penalty was in the papers you signed when you took out your mortgage, it was not snuck into the deal. You should have stayed within 25% of your income for a mortgage, have already paid off your debt before you took out a mortgage. Taking out a ARM to pay off debt is not paying off debt, it is just moving it around on a horrible interest rate and dragging the debt out over 15-30 yrs long! You took a gamble taking out the ARM in the HOPES that you could refinance in a couple of years. Now you have yet more debt and you are a risk, that is not Countrywides fault.

I hope you can get out of this mess without losing your house and I hope you understand that using your loan to get out of debt is a high risk.This mortgage mess has been hugely caused by people who instead of buying a house within their means bought that nicer one in the neighborhood down the block with the larger house, bigger lawn and then bought the furniture to look like their neighbors. Then we want to blame the mortgage company when people fall behind on their bills when they lose their job or the wife becomes pregnant and is not working.

I have seen it all and every senerio possible and mostly with a few exceptions the owners have caused their own mess. They are too angry though, to sit down and honestly say, "hey I should not have took out an ARM , I should have took out a fixed rate mortgage and stayed within my budget after I had paid off my bills." Had you been debt free before buying a house you would not be in this mess. Many people do it and it is quite possible to do. Check out Dave Ramsey and listen to him. He can lead you in the direction you need to go now.

Good luck and I truly hope you get this worked out.

Cat

First, I want to point out to the employee that posted a rebuttal that the OP got mortgage well before October 2007. If you read it correctly, you would see they got a 2 year ARM that has already reset, and will reset again in September.

Why couldn't the mortgage companies reward those who were ontime with their payments during the initial 2 year period. Most people are defaulting and/or just walking away because of the reset interest rate, not from the initial payments.

Now, one has to be behind to get any help. So, if I renege on the terms of my contract by being late, you will help me, but if I pay all my payments ontime, I get "rewarded" by having to pay more? I understand I signed a contract, however my contract states the lender "may" raise my rate, not "will" raise my rate.

If the lenders would have rewarded those who made their payments ontime, many borrowers would not be "walking away" from their homes. Due to the value of the homes plummeting, plus the increase in payments are causing many with good credit to just walk away.

Lenders: don't help those who are late with a better deal. Help those who were not late with the better deal. Those are the people who are paying you. Those who were late will always be late. If a borrower was never late at the initial rate, keep them at that rate. They have shown you they can pay it. Then people wouldn't walk away if their mortgage is more than their home is worth.

Treat it like credit cards. Late and your rate gets raised. On time and you get to keep your rate.

We'd have many less foreclosures if those who pay their mortgage were given some incentives!

I'm not passing any judgement here, but people need to take responsibility for their own actions and stop playing the victim every time they have pushed themselves into a corner. Lets take a look at your accusations and see how much fault can actually be placed on your shoulders, and not the company's.

Your first statement speaks volumes: "My husband and I needed to refinance to pay off some debt" This would indicate you were having trouble making all your monthly payments, or at least they carried interest rates much higher than a mortgage would, so you needed to consolidate. You were likely over-extended at this point anyway. Is that Countrywide's fault?

You then got into an ARM, which is know to reset to a much higher interest rate after a pre-specified term. Mostly 3-5 years. These loans are designed for people who intend to sell the property within that time, and take the profit, or who plan to refinance out of the ARM. But there is a catch. ARMs are really designed to get a person who cannot afford the fixed-rate payment on a loan of that size, into a payment they can afford for 3-5 years. It is implicit in the structure of the loan, that the only way you could afford the loan is at THAT rate and payment, otherwise you would forgo the ARM and get a fixed rate outright. As you could not afford the fixed rate loan (supposedly), you took a calculated risk in borrowing $ for which you could not afford regular payments, and opted for an ARM that would allow you to take that cash-out and make the mortgage payments.

You state that you "did not forsee" the coming disaster, but yet you only applied for the ARM in October of 2007. Anyone paying any attention to the housing market knew this disaster was impending LONG before October of 2007. Countrywide's stock dropped by 90% between March and September of 2007. 90%. These issues were real, prevalent, and fully in the public sphere-of-knowledge during the Summer of 2007, so not knowing about the impending crisis is either ignorance or self-delusional well-wishing.

Pre-payment penalties are, by law, mandatorily disclosed to borrower. This is Federal Law. If you closed on a mortgage with a prepayment penalty, you signed a Prepayment Penalty Addendum, clearly outlining the amount of the penalty and the term it covers. You signed that document at the closing, go review your closing package, it is in there. You would not, and could not, be held responsible for it if you had not signed that. People need to look at what they are signing instead of blindy doing what it takes to have $40,000 deposited in your bank account for your own personal use.

Waiting for the ARM to mature to avoid the penalty was a mistake. Your home depreciation during that time period was likely far greater than the amount of money you saved not paying the penalty.

If you refinanced to pay off debt, Im curious as to why your DTI Ratio was too high to qualify for a loan again. I'm guessing you may have again used those credit accounts after they were fully paid by your refinance, thus increasing your monthly carried debt. I could be wrong, but you likely were required to pay those certain accounts as a condition of qualifying for the loan meant to pay said debt. This means that if you run those accounts up again (especially if you DTI was borderline even with the required payoffs) you are now way over the acceptable DTI for the new loan. This is because you essentially transferred all of your credit debt to a Countrywide mortgage, and then expanded that debt by utilizing your available credit once again. You could have effectively double your debt by paying off all the cards, and then running them back up. If paying off those debts was a condition of approving the original ARM, obviously you were barely qualifying and thus any new debt acquired might push you out of qualification for any new loan.

There are options to get a fixed mortgage, but it may involve getting another borrower with superior income to go in on the loan with you. The bottom line from an underwriting standpoint is, you have borrowed too much money, and owe too many monthly payments to other creditors right now, for it to be prudent to lend you anymore money at this time. It has nothing to do with Countrywide "wanting houses" Believe me, forclosures are a MASSIVE loss of revenue for the owner of the home, which, until your mortgage is paid, is Countrywide. From your comment you seem to think that you owned the home. You don't. Until the deed is conveyed to you, Countrywide owns the home. They paid for it, not you. You are repaying the money they paid to buy the home, and for your part they let you live, use, and borrow against the equity in the home. They want you to be in the home making regular payments on-time ever time. Forclosing is a way to salvage the $ they have given to the previous owner of the home (seller), that you owe but cannot give them. If the home is worth $500,000, and you owe $312,000, they are only going to try and recover about $350,000, their investment. They don't care what the fair market value is, they just want the money that you contractually promised to pay back, but are now rescinding on due to inability to meet that commitment.

The problem is that people got into ARMs (overextended themselves) at at time when the housing bubble was at it's peak. Contrary to popular belief, Appraisals are valued based on comprable sales in the area for comprable homes. What drive the homes appraised value up is other people buying homes for that much. It has nothing to do with scams, or lenders inflating values for profit. Appraisals are based on what consumers have actually paid for homes in that area. It is based on real, not speculative data. The fact that people were willing to over pay for homes by as much as 40% drove prices sky-high. People bought homes they could not afford, because they thought the ARM would help them manage the payments until they could sell (really, flip) the home if the payments became too much. (The Rock) now, the Hard Place is the fact that values plummeted last summer-fall, as people began realizing that they had vastly over paid for their home. As prices fell (partly due to rising forclosures, remember the prices people PAY for the home determines appraised values in that area, and forclosures are bare-minimum transactions which obviously drive prices down fast) standard for underwriting tightened up considerably. Lenders no longer offered 95%-100% financing. So if you have a home valued at 800k, and you owe 675K, and go to refinance and the appraisal says your home is worth 680K, you are screwed. You can only borrow 75-90% of the home's value (612K). So unless you can come up with the $63,000, you need to keep that mortgage. This is the rock and a hard place situation that thousands of people are in.

ARMs are terrible loans and are not designed to be carried once the reset happens. They are designed to be "bailed out" of within a few years. If you cannot, it can be a severe problem. Too many people were seduced by low payments, massive lendable equity in their homes, and a desire to live in ever bigger, better homes that they previously (or more accurately: in reality) could not afford. Over-reaching and consumer greed has as much to do with the crisis as the greed of the corporation. People need to do a little self-criticism instead of simply blaiming the evil corporation for "forcing" them into a loan. NO ONE can be forced to sign a contract, and if they are, that contract can be nullified. The fact that people have to forclose rather than litigating to get out of the mortgage shows that the contract was executed in good faith, and that the borrower cannot fulfill their contractual obligation.

Companies dont have an obligation to ensure you are in a home for the rest of your life. Breach of contract (failing to pay your mortgage) is just that, a violation of an agreement that YOU signed. You agreed to ALL the terms in the mortgage with your signature. You signed the PrePayment Addendum. You signed a form saying your rate would increase to 9.5%, and beyoned, AND that you are ok with that. Whatever your alterior motives or intentions were, you agreed to the terms of the offer that Countrywide tendered. You were even given, by law, three days rescission (right to cancel) in which you could have cancelled the loan for ANY reason. You had options, and you decided to take a calculated risk with the ARM. That risk blew up in your face, and now you want to blame the one who offered it to you. It is tantamount to suing a gun company for accidental death by gunshot. It is baseless, unfounded, and completely ignores and glosses over the glaring contradiction in that YOU bought the gun. YOU put bullets into it. YOU did not read the directions. YOU failed to keep it locked up tight. And now it is THEIR fault someone was killed with it?

I am not speaking directly to the poster, and I know I am coming off callous and preachy in many people's eyes. Taking the position I have, I cannot avoid this. But if people fail to take any responsibility, they will never learn to be a more defensive consumer. A discriminating consumer. One who questions "too good to be true" offers, or reads all of the fine print. Put the blame soleley on the wolf-in-sheep's-clothing that you think is Countrywide, and this kind of thing WILL happen to you in the future. You can count on it.

I'm not passing any judgement here, but people need to take responsibility for their own actions and stop playing the victim every time they have pushed themselves into a corner. Lets take a look at your accusations and see how much fault can actually be placed on your shoulders, and not the company's.

Your first statement speaks volumes: "My husband and I needed to refinance to pay off some debt" This would indicate you were having trouble making all your monthly payments, or at least they carried interest rates much higher than a mortgage would, so you needed to consolidate. You were likely over-extended at this point anyway. Is that Countrywide's fault?

You then got into an ARM, which is know to reset to a much higher interest rate after a pre-specified term. Mostly 3-5 years. These loans are designed for people who intend to sell the property within that time, and take the profit, or who plan to refinance out of the ARM. But there is a catch. ARMs are really designed to get a person who cannot afford the fixed-rate payment on a loan of that size, into a payment they can afford for 3-5 years. It is implicit in the structure of the loan, that the only way you could afford the loan is at THAT rate and payment, otherwise you would forgo the ARM and get a fixed rate outright. As you could not afford the fixed rate loan (supposedly), you took a calculated risk in borrowing $ for which you could not afford regular payments, and opted for an ARM that would allow you to take that cash-out and make the mortgage payments.

You state that you "did not forsee" the coming disaster, but yet you only applied for the ARM in October of 2007. Anyone paying any attention to the housing market knew this disaster was impending LONG before October of 2007. Countrywide's stock dropped by 90% between March and September of 2007. 90%. These issues were real, prevalent, and fully in the public sphere-of-knowledge during the Summer of 2007, so not knowing about the impending crisis is either ignorance or self-delusional well-wishing.

Pre-payment penalties are, by law, mandatorily disclosed to borrower. This is Federal Law. If you closed on a mortgage with a prepayment penalty, you signed a Prepayment Penalty Addendum, clearly outlining the amount of the penalty and the term it covers. You signed that document at the closing, go review your closing package, it is in there. You would not, and could not, be held responsible for it if you had not signed that. People need to look at what they are signing instead of blindy doing what it takes to have $40,000 deposited in your bank account for your own personal use.

Waiting for the ARM to mature to avoid the penalty was a mistake. Your home depreciation during that time period was likely far greater than the amount of money you saved not paying the penalty.

If you refinanced to pay off debt, Im curious as to why your DTI Ratio was too high to qualify for a loan again. I'm guessing you may have again used those credit accounts after they were fully paid by your refinance, thus increasing your monthly carried debt. I could be wrong, but you likely were required to pay those certain accounts as a condition of qualifying for the loan meant to pay said debt. This means that if you run those accounts up again (especially if you DTI was borderline even with the required payoffs) you are now way over the acceptable DTI for the new loan. This is because you essentially transferred all of your credit debt to a Countrywide mortgage, and then expanded that debt by utilizing your available credit once again. You could have effectively double your debt by paying off all the cards, and then running them back up. If paying off those debts was a condition of approving the original ARM, obviously you were barely qualifying and thus any new debt acquired might push you out of qualification for any new loan.

There are options to get a fixed mortgage, but it may involve getting another borrower with superior income to go in on the loan with you. The bottom line from an underwriting standpoint is, you have borrowed too much money, and owe too many monthly payments to other creditors right now, for it to be prudent to lend you anymore money at this time. It has nothing to do with Countrywide "wanting houses" Believe me, forclosures are a MASSIVE loss of revenue for the owner of the home, which, until your mortgage is paid, is Countrywide. From your comment you seem to think that you owned the home. You don't. Until the deed is conveyed to you, Countrywide owns the home. They paid for it, not you. You are repaying the money they paid to buy the home, and for your part they let you live, use, and borrow against the equity in the home. They want you to be in the home making regular payments on-time ever time. Forclosing is a way to salvage the $ they have given to the previous owner of the home (seller), that you owe but cannot give them. If the home is worth $500,000, and you owe $312,000, they are only going to try and recover about $350,000, their investment. They don't care what the fair market value is, they just want the money that you contractually promised to pay back, but are now rescinding on due to inability to meet that commitment.

The problem is that people got into ARMs (overextended themselves) at at time when the housing bubble was at it's peak. Contrary to popular belief, Appraisals are valued based on comprable sales in the area for comprable homes. What drive the homes appraised value up is other people buying homes for that much. It has nothing to do with scams, or lenders inflating values for profit. Appraisals are based on what consumers have actually paid for homes in that area. It is based on real, not speculative data. The fact that people were willing to over pay for homes by as much as 40% drove prices sky-high. People bought homes they could not afford, because they thought the ARM would help them manage the payments until they could sell (really, flip) the home if the payments became too much. (The Rock) now, the Hard Place is the fact that values plummeted last summer-fall, as people began realizing that they had vastly over paid for their home. As prices fell (partly due to rising forclosures, remember the prices people PAY for the home determines appraised values in that area, and forclosures are bare-minimum transactions which obviously drive prices down fast) standard for underwriting tightened up considerably. Lenders no longer offered 95%-100% financing. So if you have a home valued at 800k, and you owe 675K, and go to refinance and the appraisal says your home is worth 680K, you are screwed. You can only borrow 75-90% of the home's value (612K). So unless you can come up with the $63,000, you need to keep that mortgage. This is the rock and a hard place situation that thousands of people are in.

ARMs are terrible loans and are not designed to be carried once the reset happens. They are designed to be "bailed out" of within a few years. If you cannot, it can be a severe problem. Too many people were seduced by low payments, massive lendable equity in their homes, and a desire to live in ever bigger, better homes that they previously (or more accurately: in reality) could not afford. Over-reaching and consumer greed has as much to do with the crisis as the greed of the corporation. People need to do a little self-criticism instead of simply blaiming the evil corporation for "forcing" them into a loan. NO ONE can be forced to sign a contract, and if they are, that contract can be nullified. The fact that people have to forclose rather than litigating to get out of the mortgage shows that the contract was executed in good faith, and that the borrower cannot fulfill their contractual obligation.

Companies dont have an obligation to ensure you are in a home for the rest of your life. Breach of contract (failing to pay your mortgage) is just that, a violation of an agreement that YOU signed. You agreed to ALL the terms in the mortgage with your signature. You signed the PrePayment Addendum. You signed a form saying your rate would increase to 9.5%, and beyoned, AND that you are ok with that. Whatever your alterior motives or intentions were, you agreed to the terms of the offer that Countrywide tendered. You were even given, by law, three days rescission (right to cancel) in which you could have cancelled the loan for ANY reason. You had options, and you decided to take a calculated risk with the ARM. That risk blew up in your face, and now you want to blame the one who offered it to you. It is tantamount to suing a gun company for accidental death by gunshot. It is baseless, unfounded, and completely ignores and glosses over the glaring contradiction in that YOU bought the gun. YOU put bullets into it. YOU did not read the directions. YOU failed to keep it locked up tight. And now it is THEIR fault someone was killed with it?

I am not speaking directly to the poster, and I know I am coming off callous and preachy in many people's eyes. Taking the position I have, I cannot avoid this. But if people fail to take any responsibility, they will never learn to be a more defensive consumer. A discriminating consumer. One who questions "too good to be true" offers, or reads all of the fine print. Put the blame soleley on the wolf-in-sheep's-clothing that you think is Countrywide, and this kind of thing WILL happen to you in the future. You can count on it.

I'm not passing any judgement here, but people need to take responsibility for their own actions and stop playing the victim every time they have pushed themselves into a corner. Lets take a look at your accusations and see how much fault can actually be placed on your shoulders, and not the company's.

Your first statement speaks volumes: "My husband and I needed to refinance to pay off some debt" This would indicate you were having trouble making all your monthly payments, or at least they carried interest rates much higher than a mortgage would, so you needed to consolidate. You were likely over-extended at this point anyway. Is that Countrywide's fault?

You then got into an ARM, which is know to reset to a much higher interest rate after a pre-specified term. Mostly 3-5 years. These loans are designed for people who intend to sell the property within that time, and take the profit, or who plan to refinance out of the ARM. But there is a catch. ARMs are really designed to get a person who cannot afford the fixed-rate payment on a loan of that size, into a payment they can afford for 3-5 years. It is implicit in the structure of the loan, that the only way you could afford the loan is at THAT rate and payment, otherwise you would forgo the ARM and get a fixed rate outright. As you could not afford the fixed rate loan (supposedly), you took a calculated risk in borrowing $ for which you could not afford regular payments, and opted for an ARM that would allow you to take that cash-out and make the mortgage payments.

You state that you "did not forsee" the coming disaster, but yet you only applied for the ARM in October of 2007. Anyone paying any attention to the housing market knew this disaster was impending LONG before October of 2007. Countrywide's stock dropped by 90% between March and September of 2007. 90%. These issues were real, prevalent, and fully in the public sphere-of-knowledge during the Summer of 2007, so not knowing about the impending crisis is either ignorance or self-delusional well-wishing.

Pre-payment penalties are, by law, mandatorily disclosed to borrower. This is Federal Law. If you closed on a mortgage with a prepayment penalty, you signed a Prepayment Penalty Addendum, clearly outlining the amount of the penalty and the term it covers. You signed that document at the closing, go review your closing package, it is in there. You would not, and could not, be held responsible for it if you had not signed that. People need to look at what they are signing instead of blindy doing what it takes to have $40,000 deposited in your bank account for your own personal use.

Waiting for the ARM to mature to avoid the penalty was a mistake. Your home depreciation during that time period was likely far greater than the amount of money you saved not paying the penalty.

If you refinanced to pay off debt, Im curious as to why your DTI Ratio was too high to qualify for a loan again. I'm guessing you may have again used those credit accounts after they were fully paid by your refinance, thus increasing your monthly carried debt. I could be wrong, but you likely were required to pay those certain accounts as a condition of qualifying for the loan meant to pay said debt. This means that if you run those accounts up again (especially if you DTI was borderline even with the required payoffs) you are now way over the acceptable DTI for the new loan. This is because you essentially transferred all of your credit debt to a Countrywide mortgage, and then expanded that debt by utilizing your available credit once again. You could have effectively double your debt by paying off all the cards, and then running them back up. If paying off those debts was a condition of approving the original ARM, obviously you were barely qualifying and thus any new debt acquired might push you out of qualification for any new loan.

There are options to get a fixed mortgage, but it may involve getting another borrower with superior income to go in on the loan with you. The bottom line from an underwriting standpoint is, you have borrowed too much money, and owe too many monthly payments to other creditors right now, for it to be prudent to lend you anymore money at this time. It has nothing to do with Countrywide "wanting houses" Believe me, forclosures are a MASSIVE loss of revenue for the owner of the home, which, until your mortgage is paid, is Countrywide. From your comment you seem to think that you owned the home. You don't. Until the deed is conveyed to you, Countrywide owns the home. They paid for it, not you. You are repaying the money they paid to buy the home, and for your part they let you live, use, and borrow against the equity in the home. They want you to be in the home making regular payments on-time ever time. Forclosing is a way to salvage the $ they have given to the previous owner of the home (seller), that you owe but cannot give them. If the home is worth $500,000, and you owe $312,000, they are only going to try and recover about $350,000, their investment. They don't care what the fair market value is, they just want the money that you contractually promised to pay back, but are now rescinding on due to inability to meet that commitment.

The problem is that people got into ARMs (overextended themselves) at at time when the housing bubble was at it's peak. Contrary to popular belief, Appraisals are valued based on comprable sales in the area for comprable homes. What drive the homes appraised value up is other people buying homes for that much. It has nothing to do with scams, or lenders inflating values for profit. Appraisals are based on what consumers have actually paid for homes in that area. It is based on real, not speculative data. The fact that people were willing to over pay for homes by as much as 40% drove prices sky-high. People bought homes they could not afford, because they thought the ARM would help them manage the payments until they could sell (really, flip) the home if the payments became too much. (The Rock) now, the Hard Place is the fact that values plummeted last summer-fall, as people began realizing that they had vastly over paid for their home. As prices fell (partly due to rising forclosures, remember the prices people PAY for the home determines appraised values in that area, and forclosures are bare-minimum transactions which obviously drive prices down fast) standard for underwriting tightened up considerably. Lenders no longer offered 95%-100% financing. So if you have a home valued at 800k, and you owe 675K, and go to refinance and the appraisal says your home is worth 680K, you are screwed. You can only borrow 75-90% of the home's value (612K). So unless you can come up with the $63,000, you need to keep that mortgage. This is the rock and a hard place situation that thousands of people are in.

ARMs are terrible loans and are not designed to be carried once the reset happens. They are designed to be "bailed out" of within a few years. If you cannot, it can be a severe problem. Too many people were seduced by low payments, massive lendable equity in their homes, and a desire to live in ever bigger, better homes that they previously (or more accurately: in reality) could not afford. Over-reaching and consumer greed has as much to do with the crisis as the greed of the corporation. People need to do a little self-criticism instead of simply blaiming the evil corporation for "forcing" them into a loan. NO ONE can be forced to sign a contract, and if they are, that contract can be nullified. The fact that people have to forclose rather than litigating to get out of the mortgage shows that the contract was executed in good faith, and that the borrower cannot fulfill their contractual obligation.

Companies dont have an obligation to ensure you are in a home for the rest of your life. Breach of contract (failing to pay your mortgage) is just that, a violation of an agreement that YOU signed. You agreed to ALL the terms in the mortgage with your signature. You signed the PrePayment Addendum. You signed a form saying your rate would increase to 9.5%, and beyoned, AND that you are ok with that. Whatever your alterior motives or intentions were, you agreed to the terms of the offer that Countrywide tendered. You were even given, by law, three days rescission (right to cancel) in which you could have cancelled the loan for ANY reason. You had options, and you decided to take a calculated risk with the ARM. That risk blew up in your face, and now you want to blame the one who offered it to you. It is tantamount to suing a gun company for accidental death by gunshot. It is baseless, unfounded, and completely ignores and glosses over the glaring contradiction in that YOU bought the gun. YOU put bullets into it. YOU did not read the directions. YOU failed to keep it locked up tight. And now it is THEIR fault someone was killed with it?

I am not speaking directly to the poster, and I know I am coming off callous and preachy in many people's eyes. Taking the position I have, I cannot avoid this. But if people fail to take any responsibility, they will never learn to be a more defensive consumer. A discriminating consumer. One who questions "too good to be true" offers, or reads all of the fine print. Put the blame soleley on the wolf-in-sheep's-clothing that you think is Countrywide, and this kind of thing WILL happen to you in the future. You can count on it.

I'm not passing any judgement here, but people need to take responsibility for their own actions and stop playing the victim every time they have pushed themselves into a corner. Lets take a look at your accusations and see how much fault can actually be placed on your shoulders, and not the company's.

Your first statement speaks volumes: "My husband and I needed to refinance to pay off some debt" This would indicate you were having trouble making all your monthly payments, or at least they carried interest rates much higher than a mortgage would, so you needed to consolidate. You were likely over-extended at this point anyway. Is that Countrywide's fault?

You then got into an ARM, which is know to reset to a much higher interest rate after a pre-specified term. Mostly 3-5 years. These loans are designed for people who intend to sell the property within that time, and take the profit, or who plan to refinance out of the ARM. But there is a catch. ARMs are really designed to get a person who cannot afford the fixed-rate payment on a loan of that size, into a payment they can afford for 3-5 years. It is implicit in the structure of the loan, that the only way you could afford the loan is at THAT rate and payment, otherwise you would forgo the ARM and get a fixed rate outright. As you could not afford the fixed rate loan (supposedly), you took a calculated risk in borrowing $ for which you could not afford regular payments, and opted for an ARM that would allow you to take that cash-out and make the mortgage payments.

You state that you "did not forsee" the coming disaster, but yet you only applied for the ARM in October of 2007. Anyone paying any attention to the housing market knew this disaster was impending LONG before October of 2007. Countrywide's stock dropped by 90% between March and September of 2007. 90%. These issues were real, prevalent, and fully in the public sphere-of-knowledge during the Summer of 2007, so not knowing about the impending crisis is either ignorance or self-delusional well-wishing.

Pre-payment penalties are, by law, mandatorily disclosed to borrower. This is Federal Law. If you closed on a mortgage with a prepayment penalty, you signed a Prepayment Penalty Addendum, clearly outlining the amount of the penalty and the term it covers. You signed that document at the closing, go review your closing package, it is in there. You would not, and could not, be held responsible for it if you had not signed that. People need to look at what they are signing instead of blindy doing what it takes to have $40,000 deposited in your bank account for your own personal use.

Waiting for the ARM to mature to avoid the penalty was a mistake. Your home depreciation during that time period was likely far greater than the amount of money you saved not paying the penalty.

If you refinanced to pay off debt, Im curious as to why your DTI Ratio was too high to qualify for a loan again. I'm guessing you may have again used those credit accounts after they were fully paid by your refinance, thus increasing your monthly carried debt. I could be wrong, but you likely were required to pay those certain accounts as a condition of qualifying for the loan meant to pay said debt. This means that if you run those accounts up again (especially if you DTI was borderline even with the required payoffs) you are now way over the acceptable DTI for the new loan. This is because you essentially transferred all of your credit debt to a Countrywide mortgage, and then expanded that debt by utilizing your available credit once again. You could have effectively double your debt by paying off all the cards, and then running them back up. If paying off those debts was a condition of approving the original ARM, obviously you were barely qualifying and thus any new debt acquired might push you out of qualification for any new loan.

There are options to get a fixed mortgage, but it may involve getting another borrower with superior income to go in on the loan with you. The bottom line from an underwriting standpoint is, you have borrowed too much money, and owe too many monthly payments to other creditors right now, for it to be prudent to lend you anymore money at this time. It has nothing to do with Countrywide "wanting houses" Believe me, forclosures are a MASSIVE loss of revenue for the owner of the home, which, until your mortgage is paid, is Countrywide. From your comment you seem to think that you owned the home. You don't. Until the deed is conveyed to you, Countrywide owns the home. They paid for it, not you. You are repaying the money they paid to buy the home, and for your part they let you live, use, and borrow against the equity in the home. They want you to be in the home making regular payments on-time ever time. Forclosing is a way to salvage the $ they have given to the previous owner of the home (seller), that you owe but cannot give them. If the home is worth $500,000, and you owe $312,000, they are only going to try and recover about $350,000, their investment. They don't care what the fair market value is, they just want the money that you contractually promised to pay back, but are now rescinding on due to inability to meet that commitment.

The problem is that people got into ARMs (overextended themselves) at at time when the housing bubble was at it's peak. Contrary to popular belief, Appraisals are valued based on comprable sales in the area for comprable homes. What drive the homes appraised value up is other people buying homes for that much. It has nothing to do with scams, or lenders inflating values for profit. Appraisals are based on what consumers have actually paid for homes in that area. It is based on real, not speculative data. The fact that people were willing to over pay for homes by as much as 40% drove prices sky-high. People bought homes they could not afford, because they thought the ARM would help them manage the payments until they could sell (really, flip) the home if the payments became too much. (The Rock) now, the Hard Place is the fact that values plummeted last summer-fall, as people began realizing that they had vastly over paid for their home. As prices fell (partly due to rising forclosures, remember the prices people PAY for the home determines appraised values in that area, and forclosures are bare-minimum transactions which obviously drive prices down fast) standard for underwriting tightened up considerably. Lenders no longer offered 95%-100% financing. So if you have a home valued at 800k, and you owe 675K, and go to refinance and the appraisal says your home is worth 680K, you are screwed. You can only borrow 75-90% of the home's value (612K). So unless you can come up with the $63,000, you need to keep that mortgage. This is the rock and a hard place situation that thousands of people are in.

ARMs are terrible loans and are not designed to be carried once the reset happens. They are designed to be "bailed out" of within a few years. If you cannot, it can be a severe problem. Too many people were seduced by low payments, massive lendable equity in their homes, and a desire to live in ever bigger, better homes that they previously (or more accurately: in reality) could not afford. Over-reaching and consumer greed has as much to do with the crisis as the greed of the corporation. People need to do a little self-criticism instead of simply blaiming the evil corporation for "forcing" them into a loan. NO ONE can be forced to sign a contract, and if they are, that contract can be nullified. The fact that people have to forclose rather than litigating to get out of the mortgage shows that the contract was executed in good faith, and that the borrower cannot fulfill their contractual obligation.

Companies dont have an obligation to ensure you are in a home for the rest of your life. Breach of contract (failing to pay your mortgage) is just that, a violation of an agreement that YOU signed. You agreed to ALL the terms in the mortgage with your signature. You signed the PrePayment Addendum. You signed a form saying your rate would increase to 9.5%, and beyoned, AND that you are ok with that. Whatever your alterior motives or intentions were, you agreed to the terms of the offer that Countrywide tendered. You were even given, by law, three days rescission (right to cancel) in which you could have cancelled the loan for ANY reason. You had options, and you decided to take a calculated risk with the ARM. That risk blew up in your face, and now you want to blame the one who offered it to you. It is tantamount to suing a gun company for accidental death by gunshot. It is baseless, unfounded, and completely ignores and glosses over the glaring contradiction in that YOU bought the gun. YOU put bullets into it. YOU did not read the directions. YOU failed to keep it locked up tight. And now it is THEIR fault someone was killed with it?

I am not speaking directly to the poster, and I know I am coming off callous and preachy in many people's eyes. Taking the position I have, I cannot avoid this. But if people fail to take any responsibility, they will never learn to be a more defensive consumer. A discriminating consumer. One who questions "too good to be true" offers, or reads all of the fine print. Put the blame soleley on the wolf-in-sheep's-clothing that you think is Countrywide, and this kind of thing WILL happen to you in the future. You can count on it.

Countywide is being taken over by BANK OF AMERICA. You're really screwed now. The worst place to have a mortgage by one of the worst banks in America. Good luck.