What Can Come about to Credit Cards After Foreclosure
Like so many of you, I too have had my share of economic challenges the past couple years. During the good times, I got a tiny overzealous and bought a 2nd dwelling and a seasonal holiday rental. Fundamentally this meant that I had three mortgage payments and the rental income I received only covered the expenses on the seasonal trip rental during the summer months. As soon as winter came around, these came out of my pocket also, so I decided the most effective issue to do was sell the trip rental, so on the industry it went.
There my listing sat, and sat, and sat, collecting dust with no gives. It got to the point where I could no longer afford to make the payments on the 1st and 2nd, so with considerably hesitation, recognizing I was going to ruin my excellent credit rating of the past 20 years, I stopped creating the payments on December 1st, 2008. I had no decision.
The late payment letters and collection telephone calls began coming rapidly and furious by February. I really necessary to understand yet another language or two, because how many times can you tell a collection agent “I do not have the funds” immediately after 3 phone calls from the same lender in One particular WEEK? Possibly if I could say it in Spanish or Greek, they’d have an understanding of and cease calling. But no…..persistent buggers they are….and the saga continued till I just stopped answering the phone.
So April came and I got a letter from my credit card organization who holds both my Visa and my American Express accounts for the previous 15 years. These two accounts didn’t begin out with this “ungentle giant”, but they ended up there much to my dismay. So anyway, I got this letter saying that my $45,000 credit line (that I paid perfectly up to that point I could possibly add) was getting reduce to $13,000. Guess how they came up with that amount? It wasn’t rocket science or anything. My balance on the card at that point was $12,800, so I guess $13K looked like a good round quantity. Ditto for my American Express account. This business is nothing if not efficient! Nothing like killing two birds with a single stone!
Getting the so named “credit professional” that I am, I knew this was the start of the ramifications of my not making my mortgage payments on my seasonal vacation rental, but boy, did that hurt the ego or what? I’d had that account for 15 years with a $45,000 credit limit had under no circumstances missed a payment or ever been late, and now it was down to $13,000. If that wasn’t terrible sufficient, do you know what happens when your balance is fundamentally as higher as your credit limit? It totally dumps your credit scores……as if the late payments on the mortgage weren’t negative adequate. I went from a 768 score down to a 569. Thanks for the support! Deep down I knew and understood their reasoning. I was now considered a credit danger and they had to limit their achievable loss. I confident did not like it, but I understood it.
Okay, so I had to adjust my spending…..move auto payments about to a different card that hadn’t reduce us yet and commonly fight on-going depression for the subsequent handful of months while I adjusted to my new crappy credit standing. I knew that once the foreclosure was actually done and over with, my credit would commence to repair itself, (soon after about two years) and I wanted to get that clock started, but the lender hadn’t foreclosed but. By September of 2009, I was finding actually frustrated, so I wrote a nice letter to my very first mortgage holder saying “Please take my residence!” and I enclosed the house crucial. Thought I’d make it simple for them and give them the incentive to just go to sale and get this issue performed. I guess it worked since on October 19th, I lost my residence to my initial mortgage holder.
I sat back and said “Ahhh….” That chapter is more than and I can move on, but noooooooooooo……. I had a 2nd mortgage as well and they wouldn’t go away. In all fairness, I got this 2nd in 2007 when I saw the writing on the wall with the economy and genuine estate values. I took as significantly out of this property as I could…..to the tune of $135,000. I put some of the funds into upgrades on the home that got foreclosed on, and I made use of the rest to reside on for 2008. Wells seriously had just about every right to want their loan repaid and considering the fact that they did not initiate foreclosure proceedings themselves, I was now being hounded by Wells continuously. “Either pay or we’ll seek legal action.”
Again, becoming the “credit specialist” that I am, I knew if they decided to seek legal action, that would result in a judgment against me which would be a different significant ding on my credit and it also would start out to accrue interest on a considerably larger scale. My Second Mortgage lender told me that if I made payments NOW, directly to them, the interest would stop accruing on the account and any payments I created would be credited directly to the principal. Considering the fact that I didn’t see any other way around the scenario, brief of filing for bankruptcy, I began to spend them $200 a month. They definitely wanted $65,000 and they’d get in touch with it settled, except for 1099’ing me for the distinction. Is not that good? Yeah, like if I had $65,000, I wouldn’t be in this mess.
So far, so superior with the $200 a month till final month, when they tried to talk me into the “ten year strategy” for $1,200 a month. Naaaa…..that’s a bit significantly…….how about $300? They seemed to be okay with that, but now I’m finding a “Mortgage” call a couple instances a week again. That is okay. I know the number now and however I’ve been also busy to answer the telephone when they call. feacc18 know this arrangement is not going to last forever, but for now, I am dealing with it.
To top this complete sucky last year off, after taking care of my elderly dad for the past two years, he passed away this last October. I’ve spent so considerably time with him in the past two years, that now I’m a little lost, but he’s in a far better place. It was his time. He was 87 and his top quality of life was deteriorating quickly in the past six months ahead of he passed, so I feel it was a great issue that he went just before he got any worse. It brings me comfort as well, figuring out he is now with my mom, who passed virtually 11 years ago now.
My sweet, sweet dad, who was my economic advisor forever, looked out for himself properly more than the years, and I was left with a tiny bit of funds from him. It wasn’t a ton, but I was quite thankful for it and it allowed me to spend off my Visa and my American Express final week. I thought, okay, at least I have two credit cards now with $11,000 to $13,000 limits on them, and that should really aid my credit scores come back up now, due to the fact my balance-to-limit ratio is not going to be higher anymore. This was going to be the beginning of starting to get my credit rating back.