Where to start. First off, this couple no doubt started getting in trouble months or weeks after they bought the house as the loan was originated in August 2006. What does that tell you. Second, the monthly payment amount of $1,636 on $214,000 borrowed cannot include property taxes, which in Illinois adds probably another $350 - $400 on top of the $1,636 amount. The article seems to imply that this couple will max out their credit cards, save their house, and declare bankruptcy. Finally, to all the fools out there who there who will load up on the $20 cheap plastic Chinese garbage as Christmas gifts and lose their house...don't come crying to the government for a bail out. And NO SOB stories in the MSM!!
Yeah, but again reduced by mortgage interest deduction which is probably 400-550 per month. So we're back to about $1,500 monthly cash outlay, let's give 'em $125/week for food and incidentals.
So this couple needs maybe $2K month cash income, $24K per year. Let's say before tax income is $35K for TWO people (and THAT'S TOO GENEROUS).
Looks like these two got a $214K "no doc" mortgage with an income not much more than official U.S. poverty levels.
They should go to www.salary.com and look for (apparently) low-skill and/or sales jobs to meet their financial needs. Even your basic retail sales job pays $24K in Chicago. If they both work retail, they can pay their bills AND put money on the bank.
Another potential long-term problem they will have is that, if they declare bankruptcy, she may not be able to work in the banking/financial services industry again in the future.