Mortgage mess

Seven On Your Side
January 9, 2009 1:23:36 PM PST
More homeowners than ever are asking their mortgage company to modify their loan. But one New Jersey couple thought they paired down their monthly mortgage only to have the offer taken away. Pam and Brian Baldwin built what they call their castle from the ground up nearly eight years ago.

"It's special," beamed Pam Baldwin to 7 On Your Side's Tappy Phillips. "We built it together. It's for our children."

But last year a financial perfect storm hit. Their mortgage adjusted up, way up, to over 9.4%. Then, Pam got sick and her husband lost his job.

"We couldn't afford it anymore. We didn't know how we were going to make our payments," said Pam

Pam asked her mortgage company to modify her loan. GMAC came through, with an offer to lower the interest rate to just 2.9%. Their mortgage would go from $2550 per month to less than $1600.

"I called Brian at work and I said to him," said Pam. "I think I can breathe now. And then it went downhill from there." That's because GMAC rescinded the 2.9% offer, replacing it with a 6% mortgage.

But when Pam called GMAC? "What was getting me was no one was calling me back. No one was giving me an answer."

So Pam got 7 on her side. And after we called her mortgage company? The Baldwin's interest rate was lowered to just 2.6%, a savings of $500 per month. Pam got the good news on Christmas Eve. She'll be able to afford her home.

"I looked at my husband and I just said Merry Christmas," said the relieved homeowner, "It's going to be a great year."

GMAC apologized to the Baldwins saying they made a mistake. What helped the homeowners out was they had the original offer in writing. When you're going through a refinance or modification - get those offers in writing.