Tag: foreclosure

Case closed

The case Bank of America (or whatever their long formal name is) vs Kenneth Marable is dismissed. Foreclosure is officially stopped! The i’s have been crossed and t’s dotted. Took a while, but *whew!*

As was clear from past posts, this has been expected for a while. However, since I have chronicled the path up until now, I figured I should formally announce it over, as well. Now I can go back to posting about other topics (or not posting as is more typical). 🙂

Mortgage Update, Final Chapter

Well, at least the beginning of the final chapter. It was so wonderful seeing everyone during the holidays, that I forgot to update everyone on the house situation getting all resolved. (Not to mention work, teaching, and classes all piled up at the same time to get real insane for most of December.)

But we were approved for a permanent mortgage modification. (As usual, I rambled on a long time. So you can just read that bold sentence and skip the rest if you want.) 🙂 All past due amounts are gone, escrow is up to date, etc. Also, they are modifying the principle to lower our monthly payments and actually get the mortgage less than the value of the house. We were just concerned with the past due amounts, but if they are modifying it, they want to make sure the mortgage isn’t “under water” since it’s a far safer loan for them.

And for the record, this was part of the settlement with the Federal government in the “we foreclosed on people without proper paperwork” lawsuit that hit the major banks for billions. So, I suppose it’s a win-win, since we get our mortgage cleared up, and Bank of America gets to pay the fine to themselves. 🙂

Taxes

There is one issue however – taxes. Loan reduction is considered taxable income (even though it’s the bank changing numbers on their spreadsheet and no actual income passing through us, but it makes some abstract sense). Back in 2007, they passed the Mortgage Forgiveness Debt Relief Act that exempted mortgage modification and short sales on primary residences. It expired yesterday.

Our mortgage was officially modified as of… today. Unfortunately, there wasn’t time to get everything processed during last year. It was even faster than they said ti would be, but just couldn’t be rushed fast enough.

So, if nothing changes, our taxes in early 2014 will include a sizable amount of additional “income” we will owe taxes on. I will have to watch numbers closely, and with luck it will cancel out any return we would have had since we still earn low enough with 3 kids and other deductions that we get almost full refunds. But I gotta run the numbers, of course, and plan for the worst since right now who knows what the tax situation will look like in 12 months.

Before the whole fiscal cliff nonsense, there were several bills from both parties extending the tax exemption and most of the fighting was over who could claim credit for it. Most all the state governments have been lobbying Congress to extend it, and the Realtor lobbyists are working hard pushing for its extension (since it would allow more short sales and keep the housing market moving).

Although, I’m certainly biased, even in general I think it is a great idea and hope it gets extended. The sort of situations it helps most is when people like us were doing bad and then start recovering and getting back on our feet. Being hit with a major tax bill right when you are recovering can certainly hurt. Short of a lottery win, recovery is a slow process.

But we will see. As of right now, the current fiscal cliff deal from the Senate does not include an extension, and if the House can pass anything, I don’t see this even on their radar (and since this Congress is most unproductive Congress since at least the 1940’s, I’m not holding my breath).

Technically, we have another 12 months for them to decide to renew it since it will affect our 2013 taxes. So after this fiscal cliff whatnot (and maybe after the Debt Ceiling/Fiscal Cliff Part 2 ballyhoo that will hit in late February), it will be good to watch and write to Congress asking for the extension. But, until something is passed, I’ll definitely be running the numbers and if need be, saving up for tax time in April 2014.

But bottom line, foreclosure process is over, it will take them 2-3 months to finish all of the processing on their end to cross the i’s and dot the t’s, but it approved, I have signed paperwork, and things are stable again. *whew*

Monthly update

Few updates on work and the house…

Still working

I’m still working at MSU. It was getting down to the wire with extending the grant, which would keep me working even to the point of my boss telling me “In the medium and short term, you are looking great. But in the immediate term, as in, if you show up tomorrow, will we pay you – that’s being sorted out.” It wasn’t the fact of having money or not, so much as, nearly all of their work is grant-based. The 5 year grant I was working on expired last Thursday, but there was money left in it that they got verbal approval to spend on having me work, but MSU bureaucracy needs official paperwork to handle the account, blah blah.

Also, they were told that a new 5 year was approved, but not the actual dollar amount, and again, until MSU accounting has an official document from the CDC, no money can move. There’s some wiggle room for the regular salaried employees since they are paid monthly, so it just needs to be sorted out by the end of June, but I’m biweekly hourly, so it got a little tight there. But I made sure to drop plentiful hints along the way, like in our big department meeting when I was showing off my work, I’d say things like, “Well, what I’m working on next if I am even here next week…” And finally even told my boss, I need to know or else I have to start getting my resume back out there…

So overall, they managed to wiggle around accounting budgets enough to keep me there for now, and today I had a meeting with my boss (which made me miss Ella’s eye appointment – oops!), about a proposal for another big project that would take up all of my time for several months, and about wanting to offer me a permanent position. The permanent position, of course, depends on getting final word on a series of grants, but it’s not so much of an IF but a WHEN the position would open up. Also, it’s a whole big political what not between my boss and the programming department (which he isn’t very fond of, and were the ones who didn’t want to hire me before). But if he focuses my job in a certain way, rather than another, I’d work for him rather than them, and since he hasn’t stopped praising the work I’ve done since I started showing him results, that would be a good thing. Hey, whatever gets me a paycheck. 🙂

Our Socialist Government Helping Us Again

As for the house, a while back the bank offered the possibility of an internal loan modification that was simply “Hey, pay your mortgage for 3 months, and then we’ll decide what we want to do… which might include anything between calling the loan up-to-date to foreclosing anyway, but at least we won’t do anything for 3 months.” Unfortunately, I was still thoroughly unemployed at the time, so we weren’t able to do that, and they wound up not doing anything for 3 months anyway.

Now that I am employed (and Diana is working at Meijer far more hours and reliably than she could get at Macy’s), I was contacting them about various loan modification options and was notified that we qualify to apply for the Big Settlement modification. Don’t know if you all heard in the news (I know Dad forwarded me an article about it), but several of the major banks did some… improper (some would say illegal) paperwork for foreclosures. Nothing too heinous, but still serious like electronically signing hundreds of documents at a time that are supposed to be individually checked for errors, etc. With a not insignificant number of people being foreclosed on through purely clerical/computer errors, many state attorney generals (and maybe even the US attorney general, I forget) started a class action lawsuit to fix it. In the settlement, the banks agreed to billions of dollars in restitution to homeowners. I think most did the usual class action settlements jokes of “each of the millions of our mortgagees get $30” or something. Bank of America (who manages our mortgage), decided that 200,000 homeowners would get major loan modifications (so fewer affected, but having a major impact).

We were notified that we qualify to apply for that. Not sure how many more qualify than will actually be able to get the modification, but considering I went from unemployed to employed (with Diana now working far more, and Alma teaching again in the Fall), we seem to be good candidates for “went through a bad patch but can afford their house now”. And even if not, there’s still internal modification at BoA’s discretion, modification through the legislation passed a couple years ago, modification through the state of Michigan, and so on. So it’s another layer of possible help, and we actually look much better on paper now than we did two months ago.

Tricky Transitions

So things are definitely looking up, but it’s also some tricky transitioning. So I am off unemployment, which is great, but the “you no longer qualify based on when you work rather than when you get your first paycheck” is a little tricky to handle, but I’ll just say we managed fine.

Other thing we have to keep a close eye on is that as we earn more, we qualify for less assistance. For example, if we earn $700 more a month, that might make us qualify for $500 less in food stamps (which is a debit card now and not stamps, but whatever). So, looking at purely the numbers, a $700 increase in income only gets us $200 better off. But those aren’t exact numbers, and it looks like it won’t be an issue of going backward and losing more benefits than our increase in income. They structured the system nicely to prevent that (after all, if people wind up getting less the more they work, there’s no financial incentive, just pride and paperwork).

The tricky one I still have to dig in to is health insurance. Diana is covered now through Meijer (which is good since she is our expensive one) ;), but the kids and I are state-covered. As our income goes up, the kids will stay qualified longer than I will, but hopefully when my income goes up higher it will be from a permanent MSU position which brings with it health insurance benefits, so that we can jump straight to that. Only tricky issue would be if we end up making more money without benefits, we could hit the gap of no longer qualifying for state insurance and having to pay for insurance out of pocket. We did that for a bit for Diana and I, but it was outrageously expensive and wound up not paying for a single thing due to pre-existing conditions and high deductibles. (To get political for a moment, there are some things that can be improved with “Obamacare”, but one thing it REALLY helps with is families in that situation – making too much to qualify for Medicaid but not having employer-paid insurance. In 2014, it fixes that problem very well, which saves money in the long run because people with insurance getting preventive care costs orders of magnitude less than uninsured people waiting until they need to be dragged to the emergency room. It really is MUCH cheaper to have people insured than not.)

So, as usual, it was waaay too long since the last update, and my “short” update, rambled on far longer than I wanted, so I hope people stuck with it. Otherwise, I’m sure we will be seeing you all soon and can chat in person.

Latest house and job update

Quick update here:

  • Last job interview wound up going to someone else (much to the chagrin of the recruiter who had been spending months trying to find a good candidate but they wound up getting someone on their own).
  • Got another interview Friday at MSU, so I’m really hoping for that. Pay is probably a bit less than what I had been looking for, but benefits are much better and being that close would be perfect! So we will see. The job listing had all the signs of “we already have someone internal for the job, but we need to formally post it”, so I almost didn’t apply. But with how things are going, I’m taking every opportunity I can, even if it is remote. Plus it sounds like a great job I would love doing, so I’m crossing my fingers!
  • I’m not sure on the exact date, but technically I think this Friday I am officially unemployed. That’s not fun, BUT as long as it is temporary, it does open up even more assistance options. So I’m getting ready to fill out plenty of forms for all the government assistance we can get. About time the 1% supported US!
  • Diana is also applying around for some more part or full time work. So two of us hitting the job market increases our chances.
  • Had our “mediation meeting” today with the law firm handling our foreclosure and (via speakerphone) Bank of America. In these meetings a very small number are approved for loan modification, a small number a denied, and the vast majority are flagged “we need more documents”. We fell into the “need more documents” category. So, as much as knowing would be nice, right now our financials are such that I don’t see us being approved, so I’m all for any delay we can get.
  • The representative from the law firm today also has a Dec 9 birthday.
  • The other useful information was on the timeline should we be denied a loan modification. Nothing happens until after Jan 11. After that, according to Michigan law, they need to post in the local newspaper for 4 weeks about the possibility of our house being up for auction. Then there is the Sheriff Sale where our house goes to the highest bidder. That is almost assuredly the Bank just buying it themselves. Then we have 6 months (again by law) for redemption where we try to rework things out. Only after that, will the house be fully owned by the bank (or whoever) and we have like 30 days to vacate (or according to Michael Moore, we should squat and stick it to the banks!) Bottom line, we have until mid-August to work something out. If neither of us is working full time by that time, we have bigger problems than our house.

So that’s where it all stands. More wait and see, but right now that’s the best news until one of us gets hired somewhere.

But for now, I need to finish up writing my term papers, studying for my final exam (a test??? I don’t remember how to do this “test” thing), and get ready to start grading 50 term papers starting tomorrow morning. (Also, help get the house ready for Marable Christmas, submit to present at another conference, write a chapter for “Superman and Philosophy”, and complete my Colorado application.) Whee! Needless to say, I’m fine with delays on the house. I want to see my family sometime. 🙂