Here is the scoop from my mortgage broker on Tuesday, before the Feds met. $XXX,000 (80% of value) plus $XX,000 2nd home equity line of credit - interest only. 1st mortgage at 6.625% fixed 30 year, line of credit at 8.25% adjustable rate (runs with prime) and interest only payment. $417,000 first mortgage at 5.875% fixed 30 year. 2nd home equity line of credit at $XXX,000 at 7.625% - interest only adj rate (your rate is prime plus .125 - so could go down after tomorrow). Nonconforming $XXX,000 with no mortgage insurance. Rate 7%. Nonconforming loan of $XXX,000 with monthly mortgage insurance until paid down to 80% rate is 6.75% I didn't get a chance to talk to her today, but I will tomorrow. The last time the Feds dropped the prime, she went down, then adjusted up, but not totally up, the next day.

When you have four pockets ... ... and you know that there's no money in three of them ... ... into which pocket do you stick your hand when you need some? ... how often do you stick your hand into any one of the three pockets where you know that there's no money even when your hand gets all of the way to the bottom?? Memo ... to individuals, as to businesses (but most of the latter know it now) ... ... when you need money ... ... go where the money is! Like the credit card companies do. They may cancel the cards of folks who've been giving them a rough time, i.e., not paying. But they don't mind your payment being late - look at the large fee that they charge ... for what ... waiting an extra day or two for the payment? Suppose it's $100.00 payment ... at 10% annual rate, that's $10.00 per year, or about 3 cents per day. If your payment arrives 3 days late ... their cost is about a dime ... and they charge you a $20.00 late fee? Think they're about to cancel your card? Why would they?? They're making a very nice bucket of money off of you ... and others like you. You go over your credit limit? More of the same. So why would they shut you down?? You're a profit centre for them!! If so for them ... how about you?? If you blow an engine in your car tomorrow ... how will you pay for the repair? Or ... if you get laid off ... what will you live on? Have you ever had a pair of handcuffs snap around your wrists? I haven't either ... and I don't want any: I have absolutely no hankering for such an experience! I love my financial freedom!! If you don't have a financial cushion of some funds available in case of immediate drastic need, I claim that you have a pair of handcuffs lying on your dresser, right beside where you lay your wallet at night. Just waiting for an emergency need of money ... or a layoff ... to have them jump up and snap around your wrists. Financial freedom - that ain't!! Hope you all have a lovely weekend ... and if you'd be sweating blood if you don't get a paycheque ... or two ... ... please - do yourself a favour. Even though it may be a beautiful weekend, find a way to enjoy it while spending little or nothing. Start that savings fund ... build yourself a financial cushion. Aim at a minimum of 3 months' income available in case of emergency. Six months' earnings, or 9 months' ... or up to a year's worth, is even better. After 25 years or so as a personal financial advisor, I don't have it, myself, some of the time. Some of the time I have money in the bank, money market fund, etc., immediately available ... but sometimes not. I have a credit card that I don't use much, that I can use to fix my car, fly me home in case the travel co. goes broke and the hotel says pay - again - or go to jail, etc. And I have a Line of Credit at the bank, initiated several years ago at no fee, fully secured by stock or mutual fund certificates, in order to arrange a low interest rate ... and it lies there unused, most of the time (but there's no inactivity fee to pay). If I use the card for emergency ... I pay off the full balance prior to the due date, using my Line of Credit if the amount in my bank account, money market, etc. are short. Then ... pay off that loan (low interest - far lower than the rate charged on unpaid balances owing on the credit card) as soon as possible. I want my money working for me ... not be forced to use other folks' money ... and pay rent on it while I'm using it ... especially if it's the kind where they charge very high rates! I never want to have to darken the door of a payday loan company: their rates are ... *horrendous*! (By the way ... have you read my thread about the differences between a paycheque and a pension cheque?) ole joyful

Hi Parma, She also said that the owner of a loan company told her that there's a law (and this is where it gets stupid) saying that you can go to your mortgage company and demand they lower your rate if you can show your home has lost a lot of its value. He said he did it with Countrywide, (our lender, also). He also said that they will try to do something else but if you stick to your guns, they have to lower it. Urban legend? Either urban legend, or a broker full of beans! *IF* your loan was sold to Freddie of Fannie, you *MAY* benefit from the upcoming Homeowner Affordability Modification Plan (HAMP) or Homeowner Affordability & Stability Plan (HASP - refinances.) More details here (go to my SECOND post inthis thread for good links); http://ths.gardenweb.com/forums/load/realestate/msg0314583220481.html?3 Homeowner Affordability and Stability Plan The industry is awaiting clarifying details from the Fed... due either April 1st, or (more likely) May 1st, at the earliest (depending on who's rumours are to be believed.) Anything already accomplished (i.e. with Countrywide or other lenders) was an open market Loan Modification negotiated prior to Obama beginning to tease us about the issuance of federal guidelines. Once the trickle-out of fed guidelines, pretty much most (or all?) of the servicing companies have frozen all negotiations while we wait for them to discover if they'll get more sugar by awaiting the government plans. Luck! Dave Donhoff Leverage Planner Here is a link that might be useful: Homeowner Affordability and Stability Plan

We actually did try to get the MI on Loan A reduced, and the best they were able to lower it is about $10 (not enough to make a difference, given that the MI on Loan B is over $100 less per month). I understand that, broadly speaking, MI and the loan interest rate are inversely related, since the higher the MI the more risk the MI company is taking, thereby allowing the lender to lower the interest rate a bit. We're hoping that Loan B (with the higher rate and lower MI) might be able to drop their rate 1/8 or 1/4 point while keeping the same MI, as that would be the best of all worlds. Not sure that'll happen, though!