Matt Martin Real Estate Helps Northern Virginia Couple Escape from Upside-Down Mortgage

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Jordan and Holly Santiago, a middle-income couple in the suburbs of Washington, DC, were caught in the squeeze of a reverse amortization loan. Their mortgage payments went up and the value of their home went down when the real estate bubble burst last year. They owed more to the bank than their house was worth. Matt Martin of Matt Martin Real Estate arranged a short sale for their house. Now they are in a new house with an affordable mortgage.

We decided we would put the home on the market and cut our losses.

Matt Martin of Matt Martin Real Estate arranged a short sale to help Jordan and Holly Santiago escape from an upside-down mortgage.

The Santiagos' mortgage payments were going up and the value of their home was going down. With the collapse of the real estate market, they owned more to the bank than their house was worth. Martin and his team of short sale negotiators arranged a short sale with the Santiagos' lender. The short sale saved the couple $150,000 and enabled them to buy a new house with a mortgage they can afford.

They thought negative amortization loan would save them money:
The Santiagos signed on for a reverse amortization mortgage in 2006 as part of a refinance of their two-year-old home in Bristow, Virginia. They bought the home for $630,000 at the height of the market in late 2004. They were paying $4,300.00 a month on a 30-year fixed mortgage.

"We weren't one of these sub-prime types of people," said Santiago. Both Santiagos are employed. He is a network engineer and Holly is a small-business banker. "If we have stayed with our fixed-rate loan, we would have had no problem, but we were led into the negative amortization loan by someone we thought was our friend.

"After our first year in the house, we were approached by a mortgage broker about being able to reduce our monthly payments," said Santiago. "We thought he had our best interests at heart. He introduced us to this new loan. We didn't pay attention to what negative amortization was or to the prepayment penalties."

They refinanced the house with the negative amortization loan and were paying $3,200.00 a month.

They were in an upside-down mortgage situation:
Several months into the loan, the Santiagos found themselves in an upside-down mortgage situation -- owing more to the bank than their house was worth.

"I usually just pay the mortgage over the phone," said Santiago. He did this for several months and then received a notice in the mail from their lender that there were several payment options on the loan, including a fully amortized payment which was $3,000 more than the Santiagos had been paying. The notice also informed them that there was a ceiling on the loan amount, which they were approaching.

With a negative amortization loan, the homeowner pays only part of the interest and the remaining balance of the interest is added to the principal owed on the mortgage. This causes the balance owed to increase each month.

"We knew there was no way we could maintain these payments," said Santiago. "We decided we would put the home on the market and cut our losses." That was July 2007. By this time, they owned nearly $700,000 because of the negative amortization and, because of the drop in the real estate market, the house was worth only $550,000.

Their realtor did some research and found Martin, a Northern Virginia realtor who specializes in short sales. Martin worked with the Santiagos to accomplish the short sale, save their credit and help them find a new house they could afford.

"After talking with Matt and his group, we felt they had a good solid team to get us through the process," said Santiago. From start to finish, the short sale process took about five to six months. They closed the short sale on January 15, 2008. Martin's group negotiated with the lender to write off the $150,000 difference between the loan and short sale. The lender only asked for $5,000 in return for the write-off.

"I didn't have to deal with the bank. Matt and his team did everything for me. They got us through this pretty gracefully," said Santiago. "We've been told that this process will not be listed on our credit as a foreclosure but as a 'closed-paid' debt settlement."

Meanwhile, Santiago and his wife have bought another home in nearby Gainesville, Virginia. They paid $406,000, including all closing costs. They have a 30-year fixed rate loan with payments they can afford.

About Matt Martin and
Martin, president of Matt Martin Real Estate, LLC, and part of Re/Max Distinctive, specializes in short sales. He has assembled a team of experienced short sale professionals, who negotiate with the lender on behalf of the homeowner. Martin works with an attorney, Doug Callabresi of the Green Law Group, P.C.

Martin and Callabresi have launched a Website -- -- to help educate overextended homeowners in Virginia, Maryland and Washington, D.C. Homeowners can find information on the Web site or by calling 888-96short (toll free).

Martin's team of short sales negotiators has closed more than 10,000 short sales and foreclosure prevention cases in 14 years. He says that if they were to put an average on each case over the past 14 years, they would value them at no less than $100,000 each or $1billion in savings to consumers.

For more information, please visit or call 888-96short toll free.


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