It was the story of our time back then, in the more robust days of 2004 and 2005. I had a stable job, newspapers were still doing OK. I had lived in Denver for a few years and figured I’d stay here a few longer. All of my single friends were doing it. With a couple of days of paperwork back and forth, I could dump my crappy one-bedroom Capitol Hill rental for a home of my own.
My parents traveled to Denver and went to the mortgage broker with me at an office-plex in Lakewood. The guy wore a Hawaiian shirt. He dimmed the lights in a conference room and showed us a PowerPoint presentation, explaining 8 0/20 mortgages. My parents — solid, responsible people who have property of their own — were perplexed. They had a little money they wanted to give me for a down payment. “There’s no need to put any money into this right now,” the Hawaiian shirt guy said to my dad. “Help her pay off her student loans instead. It’s better to just pay interest only. The home will go up in value.”
It’s five years later now, and my adjustable-rate mortgage will start, er, adjusting in about four weeks. My house has indeed gone up in value — I’ve made a few small improvements and the neighborhood is close to downtown. I’ve never missed a payment. Yet here I am, sitting at my dining room table every morning before work, flanked by piles of paperwork and my cordless phone, battling with East Coast banks about a home-loan modification.
The Obama administration set up home- loan modification programs to try to stem foreclosures of homeowners like me — people who entered the housing market through interest-only loans whose terms are rapidly expiring. The modifications come in a few different forms, but mostly they allow you to lock an agreement in, something similar to the temporary one you have, without the steep refinance fees.
Like most people in this country, my financial circumstances now are worse than last year, but I’m still employed. And I do not want to be a foreclosure statistic.
I wrote a hardship letter to my mortgage company. I sent them paystubs. I sent them a financial table that shows how much I take home every month and how much I send out in bills.
They turned me down. They’ve turned a lot of people down. According to a report released by the Treasury Department last week, Bank of America had started modifications on just 7 percent of its eligible loans. For Wells Fargo, that number is 11 percent; for Citigroup, it was only 23 percent.
Every time I call to try to figure out what happened — and I can be quite openly annoyed — the bank offers a different explanation.
One person said the private investor who holds my mortgage isn’t participating in the program. Someone else said home-loan modifications wreck your credit record and I wouldn’t want to do it anyway. Yet another woman said I don’t have enough take-home money to make a higher payment.
But if I’m willing to take on a higher payment — and make life sacrifices to do that — who are the banks to say that I will fail? I haven’t so much as been late on a water bill.
As I sat in my bathrobe at my dining room table one morning last week, once again on hold, it occurred to me that I likely have more fortitude, more stubbornness, more self-advocacy skills and more time to invest in this than most people. I don’t have a child to make breakfast for or a second job to hold down — at least not yet. I’m pretty good at research and adept at demanding an answer on the phone. (It’s part of the day job.)
A simple explanation for the global financial crisis is that people like me fell for the charm of homeownership — to build a garden with tomatoes and to eventually make money from the place I sleep every night. The promise Hawaiian shirt guy gave me and my parents that day in his conference room was that even if I wasn’t beginning to pay off the doorknob of my house, I would still make money on it. Renting is so stupid, he said. Homeowners always, always make money.
My monthly payments will likely go down in November when my ARM expires because rates are so low right now. But that won’t be permanent — and those payments still mean I won’t start paying off the doorknob. But I am taking the next few months to decide whether it’s worth it, whether owning something is worth it, whether I want to lock in a 30-year mortgage when I don’t know what I’m going to be doing in 30 months, and whether I truly have the income — and therefore the right — to be a homeowner.
It’s too bad the hundreds of thousands of other homeowners out there like me weren’t forced into these big decisions about sacrifice and maturity back when everything was fine and dandy.
Allison Sherry is a Denver Post reporter. She can be reached at asherry@ .
