An Adjustable Rate Mortgage Story

Like many Americans, Joi from Macon, GA is struggling to deal with rate changes in her adjustable rate mortgage.

She recalls, “I was marketed an adjustable rate mortgage as a way to save money, get a low interest rate and payment. I was promised that I could refinance into a fixed rate as long as I maintained a good FICO score…”

Things have not turned out as she expected because the drop in her home value has left her with negative equity. Joi wrote, “I called [my bank] to refinance but was told that I could not refinance without putting down a large amount of cash because my house went from $285,000 to $225,000.”

As a teacher, Joi does not believe that she can put together the necessary down payment to refinance and secure a more affordable mortgage payment.

She added:

Our pension is state run so I am unable to borrow from my retirement plan to save my home. I listen faithfully every night thinking that help for homeowners is coming but nothing is being done. I have been told to just stop paying so that they will have to help me but that would wreck my credit rating and drive my interest up on my credit cards which would cause more money problems for me.

Let us know about your experience.