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Local man feeling effects of IndyMac Bank problems

READ MORE: Local man feeling effects of IndyMac Bank problems
WATHA - Times are tough for many people struggling to pay mortgages, deal with the economy, and keep their families afloat. It is even worse for customers of the failing IndyMac Bank, which the federal government took over this week. A local man is caught in that web. A Pender County man got in touch with us after seeing our story earlier this week about another local Indymac customer. He says he needs help. Eulises Bland collects $1,000 a month in disability and just about all of it pays for his mortgage. His wife's income pays for their other bills. They have had to file for bankruptcy to try to make their monthly mortgage payments, and Bland is desperate to get his payments lowered, but says he has had no luck with IndyMac. He pays an 11 percent interest rate, and he says the bank won't respond to his request. After all the bills are paid each month, Bland says his family has about $100 left over. "So far we've gotten this far, but we would like to have more things to be able to afford to go out and take the kids out to a movie. But the way that the crunch is now with IndyMac Bank, it's horrible," said Bland. Credit and housing counselor Mike Young said, "Just because the bank is in trouble doesn't mean his mortgage isn't going to become due or that we can't make some other arrangements or modifications to it." Young says if you want to get interest rates dropped, you have to establish better credit. Young says in situations like Bland's, you have two options -- raise your income, by getting a part-time job, for example, or lower your expenses.

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Mortgage Crisis

IndyMac's problems are because of these subprime loans (loans to people with bad credit) where the borrowers are unable to repay what their mortgage. So, in a way, this guy is a cause of the "web" that he is now caught up in. I am not trying to talk bad about this guy. He said he is current and that he wasn't disabled when he bought the house, so his financial situation has certainly changed significantly. Or possibly, a loan officer could have taken advantage of him, approving a loan at an outrageous itnerest rate just to make a sale, knowing he would never be able to repay.

IndyMac

IndyMac brought this on themselves. They are largely a mortgage bank who made or purchased loans for people who are now having trouble paying their mortgages. So, they now find themselves holding mortgages they won't collect. Their loan portfolio consists largely of loans made to those with bad credit who have to pay higher interest rates.