Day 141: Looking Ahead

Credit Score: 654

Things I'm looking forward to in the next place we live:

Neighbors that know how to park without damaging other people's property

Parking spaces wide enough to encourage neighbors not to damage others' property

A shorter commute for Cory

No HOA fees or assessments

No HOA board or meetings

Neighbors that don't have domestic disputes, drunk arrivals, or outdoor telephone conversations, all at 3am. In English or otherwise, I'm not picky.

Bedroom windows that don't face a parking lot where such events would still happen anyway

Windows on more than one side of the house

A kitchen big enough for two

More counter space

Enough space for a table AND computer desks AND guests over, all at the same time

An interstate that's more than a block away

Walking to restaurants

Being debt-free

Temporarily pretending spiders don't live in the new place

Central heating, and I wouldn't complain if there's air conditioning

I think we can get all that in an apartment. The only questions will be where, and for how much. If we didn't leave the neighborhood we're in now, we could get all that for the same as the mortgage used to cost us. We'd really like if we could get it all for less than the mortgage. If we go to the nice areas of the city, the areas we'd really like to live in eventually, we really couldn't get it for any less than our mortgage+HOA dues. While we could afford that, I'd rather put less rent in to the apartment and be saving the difference for a future down payment. Or if we find we're permanently disillusioned with home ownership, save it for retirement or a great vacation or something.

They say rents are at an almost all-time high right now though - a response to home ownership and home prices being at almost all-time lows. So everyone in this foreclosure situation is pretty much doing the exact opposite of what we "should" be. But we've all got extenuating circumstances that make foreclosure the only thing we can do. I'd sure love to be able to go out and buy a house right now. Prices are low, interest rates are low, and if I ever buy a house again, it'd be one I plan to live in for the full 30 years of the mortgage. But it's not practical. The $100,000 debt on the condo is looming over my head and forcing me in to renting for a pretty long time. Sorry Market, I can't help ya.

Day 122: When It Rains, It Pours

Credit Score: 654

Voice Mail: 15

Email: 3

Paper: 23

On-Time: 134/136

We're now up to NINE Notices of Default! No kidding. These guys are serious about making sure we got this document. It feels very Harry Potter and I'm half expecting letters to come down the chimney soon. 

After getting the first notice on our door on Saturday, we received four letters in the mail Tuesday. Two addressed to me and two addressed to my "unknown spouse and/or domestic partner." Poor nameless Cory. :) After that, we got four notices via certified mail on Thursday - two for each of us again. And finally, Friday, we got another envelope hanging on our door knob asking us to call the mortgage company. 

Sorry I can't share all these notices with all the people that are still eagerly awaiting theirs. I hope yours turn up soon. And I hope none of us will owe the huge tax burden that creeps closer every day. 

Now that it's July, my next credit report became available (based on my self-inflicted rules). I checked Experian this time and it was very interesting. It included all the same information, it now reflected three months of missed payments on my mortgage, but it included one new tidbit. It tells me when each entry will drop off my report. My original student loans will drop off ten years after they closed. My consolidated student loans are still current so don't have a drop off estimate yet. It looked like all my closed loans drop off ten calendar years from when they closed - January 2014, January 2015, 2016, 2017, etc. Always January, which is good to know. The month of closure is irrelevant. 

Instead of a drop-off date for the mortgage, since it's not closed yet, there's a date when the loan will report as positive. January 2019. Seven calendar years from now, or seven calendar years from my original missed payment. I won't be able to tell which until I see the report again with more information. It's possible that date won't change and that'd be really nice for the homeowner. No matter how long the bank takes to foreclose then, your credit is only affected for seven years from the start of the default. If it updates on my next view of the report though, when we're in to 2013, then it's just another way for the bank to be controlling your life by neglecting their duties. I would think, though, that if the 2019 estimate were going to move to 2020 then they wouldn't have mentioned when it was going to go positive until after the account is closed/foreclosed/settled. Experian would be creating a liability if that date changes. If January 2019 rolls around and that loan is still reported as negative, I can hold up my print out of today's report saying I was promised a positive report. They've been doing this a lot longer than me though and probably have some legal disclaimer in place that it's only an "estimate" or that there's an assumption that all future reports are positive. 

Anyway, it was very useful to learn when each of my credit lines will drop off my report. Starting in just a couple years, I might start losing some of the positives that are bolstering my score and be left just with the actual accounts I have open - my two new credit cards.

Day 117: Notice of Default (for serious)

Credit Score: 654

Phone Calls: 15

Emails: 3

Paper: 14

On-Time: 133/135

Yaaaaay! For reals this time. Very definitely a Notice of Default was taped to our door last night. Over the weekend, we had received a letter that our loan was being transferred to a local law firm, then BAM! notice was posted. I like this firm already. If this pace keeps up, we could still be done this year, and still under the tax-free bill.

The significance of this notice is both that we've actually made some progress and that we're officially going down the non-judicial foreclosure route (the good one). They can still change their minds up until the sale actually happens, but it's still really rare for anyone to do a judicial (judge involved) foreclosure on such a tiny property.

Maybe this transfer is why it's been all quiet on the western front the last few weeks. And I imagine it'll continue to be quiet. The lender isn't trying to collect anymore (although the notice did say exactly how much I could pay them to un-default myself), and I'd guess that the lawyers aren't going to waste any time or money on extra papers to us.

I'm probably too optimistic, but I'd like to think that this law firm would want to get this over with as quickly as possible. All the government programs out there are designed to halt this process. If they get repeatedly halted in the middle of these foreclosures, the lawyers must get paid less.

Foolishly optimistic or not, I'm a little more hopeful of a tax break now. :) I'll be very interested to see whether we get a notice of sale at the 30-day minimum. If we do, we could be moved before Thanksgiving. There’s no maximum between the Notice of Default and the Notice of Sale though. Once we get a Notice of Sale, there’s both a minimum and a maximum, so everybody’s locked in. Until then, you could say this is artificial progress, but I’m still happy.

July looks to be an exciting month. Fireworks, perhaps the sun will finally come out, Olympics opening ceremonies, and potentially, a Notice of Sale.

Day 109: Two's No Worse Than One

Credit Score: 654

Phone Calls: 15

Emails: 3

Paper: 12

On-Time: 133/135

Greetings once again! I know it's been ages since my last update, but nothing's... really... happened. Although, I did miss Day 100 without even noticing! For shame.

No letters from the bank, three phone calls, no email, and a minor wobble in my credit score. It went up one point! Just at the turn of the month and my only guess for what that would be is because the average age of my credit lines went up? Nothing else changed.

I expected it to drop again as soon as I was reported for June, but it didn't actually. My on-time payments reflect that I was reported as unpaid for June, but it didn't change my credit score. Apparently going from one missed payment to two isn't so bad. The biggest hit comes from that one single missed payment.

We have gotten a few more notices from other lenders that my loan might qualify for the government programs - call today! They're not really tempting though. The only one that we would've qualified for before missing any payments would've been one to refinance without an appraisal to reduce the monthly payment. It showed a payment about 2/3 the price we had been paying, so that sure could've been tempting. If we'd wanted to stay, it would've been a great idea to refinance to the lower monthly payment (hopefully without extending the life of the loan any/much), and then continue to pay the previous amount. Still paying $1200/month when only $800 is due would get me some equity in the house a lot faster. But, once again, it's just good money after bad. We've got better things to do with that cash, and living rent free is pretty sweet.

Now that I'm talking about the default more, I'm hearing more and more stories about how long people have been in their homes without word from the bank. A commenter on one of my May posts has been in default for a year. A friend confided in me that he's at 14 months without even the Notice of Default. A friend of Cory's is at almost two years with no progress. We're the shortest of all these reports and I'm already frustrated that media/congress/anybody-useful isn't talking about extending the tax break. It's got to be even more frustrating for the people that started this in 2010, fully expecting to be done during the tax break but might not actually be.

If the tax break isn't extended, home owners have to get all the way through the process, with a sale under their belts, by Dec. 31st or they don't qualify. Regardless of how long the bank let them languish. It doesn't seem fair that the bank has all the power to decide who owes tens of thousands and who doesn't, based on how quickly they bother to do their paperwork. Perhaps we'll get something like the short sales just got - a deadline from A to B. 30 days to agree to a short sale offer. 3 months from default to notice of default, and the tax break applies to any that get the notice before January 1. Requiring that you complete the sale is so unfair to the people that will have been waiting and begging for bank action for years.

I know everyone tells you "life isn't fair" but that's only true because people make it so. People are unfair; life doesn't have to be.

Day 82: Reported

Credit Score: 653

Phone calls: 12

Emails: 3

Paper: 12

Just like at a restaurant, someone goes to the bathroom and the food arrives. I go out of town for a few days, and finally get reported to the credit agencies on Day 77. I now have 131 on-time payments and 132 total payments on my entire credit report. So perhaps I've only been reported for being 30 days late, not 90 like I technically am. It was a nice, big, 60-point wallop either way.

I've also been upgraded to non-automated voicemails. I got my first real person calling recently. We also got our first in-person paper delivery a while ago, but I neglected to mention. There was a small envelope on our door knob one day with a template paper for leaving messages. Blank lines to fill in subject, phone number, and the receiver's name. It was odd to get a hand-written message on the door telling me to call "the bank" concerning "your mortgage". Awkward... They know where I live!

Day 69: Power of Information!

Credit Score: 710
Phone calls: 11
Emails: 2
Paper: 8

The Seattle Weekly news article about us was published today! You can find it here. Cory and I met with Nina Shapiro a few weeks ago when our lawyer mentioned she was looking for people to talk to about strategic defaults. I was cautioned by pretty much everyone that I shouldn't put any more "out there", that talking about defaulting on a blog was already tempting fate enough. Be it wise or not, I like to share when I've found something particularly difficult in hopes that other people won't have to deal with the same issues as me. Any exposure does raise my risk of getting sued by the bank, but that just sounds so unlikely.

Fun that we're even the story opener. :) Nice talking with you, Nina!

I did actually make some progress in non-newsworthy ways over the last couple days. I was confused back in April when my credit score dropped because I really had been expecting 90 days before getting reported, plus the bank had only just threatened to report me. Additionally, Credit Karma continued to say that I was 100% on-time for all my payments. I didn't really know what was up, but went with it.

I finally bothered to investigate more, and found this chart on Credit Karma:

My credit score dip was due to opening the new line of credit with the credit union! It took a full four weeks between my credit score rising for getting more lines of credit (and a higher credit limit) and the score dropping for reducing the average age of those lines. Odd. Opening the card was to improve credit in the long run, and I knew that having a company verify my credit would dip it a bit, but I hadn't factored in that a new card would so significantly drop the average age of my accounts. Of course it would, looking back now.

It means I've got a little more credit score excitement to look forward to now. My next free credit report will by July 1, if I follow my self-enforced rationing, so I'm actually looking forward to my score dropping sooner than later, so I can see it in my credit report sooner than later.

We've also now gotten the "we want to help, send us all your information" three full times. - It feels eerily similar to "Resistance is futile. You will be assimilated." to me. - I don't particularly care to send them all my financials, but they seem to think that I'm not sending it because I don't speak English. The latest packet came with a Spanish version as well. :)

Day 65: More Warnings

Credit Score: 710
Phone calls: 10
Emails: 2
Paper mail: 7

This month, I officially hit 4 years in the condo! That's not exactly a good thing. It marks the time we've all been in this housing crisis, really. I bought the condo just after prices started dropping and everyone was saying it was a good time to buy. This week in the news, they're actually saying prices are now as low as they're going to go, and they may start rising as early as next year. That foreclosures will be lessened as the banks start clearing out their backlogs. And that rent is the highest it's been in a long time. This is when I choose to default... I'm so clever.

At least I'm officially three missed payments in now. March, April, May. I figure my credit score will drop again mid-May when I pass the third grace period for payment.

No real progress since the last update, though. Actually, it's probably a little negative progress. We got another letter in the mail saying we have 30 days to resolve the past due payments or they'll send the notice of default. Which means at least 30 more days before we get the notice.

If I were in a situation where I didn't want to lose the condo, I guess I'd appreciate seeing that they're in no hurry to give notice. And it'd be nice to know that your timeline just got bumped out 30 days. But I'm not. It's just more delay, more time in the process, and more likely to cost me tens of thousands in taxes.

Better than 100 thousand selling it though. I've got to keep telling myself that.

Maybe this will go down in Schrodinger family history as Jane's 20,000 dollar mistake. :)