People Are Hoping To Avoid Foreclosure Through Loan Modification
This post series started a few days ago with a look at the “Making Home Affordable” program that the Obama administration passed earlier this year. In that post I gave an overview of the program, what it is designed to do, and who will qualify for help under the program. I looked at both the refinance program, as well as the loan modification program.
In Friday’s post I looked at the “Making Home Affordable Refinance” program, and talked about some of the questions people have about the program. Today I thought I’d round it out by doing a FAQ about the Making Home Affordable Loan Modification program. (If you have a second mortgage, don’t forget to check out this post)
Making Home Affordable Loan Modification FAQ
After reading through the government’s website, and a couple of other resources, here are some of the most common questions about the Loan modification program:
- Can Making Home Affordable help me if my loan is not owned or securitized by Fannie Mae or Freddie Mac? Yes. The Treasury has put together financial incentives for loan servicers to make it worth their while to modify homeowner’s loans to help save their homes. The government hopes to help 3 to 4 million homeowners avoid foreclosure.
- Do I need to be behind on my mortgage payments to be eligible for a Home Affordable Modification? No. Borrowers who are struggling to remain current may be eligible as well if they are at risk of default. For example, maybe their mortgage payment has recently increased because of a higher interest rate making the mortgage unaffordable. Maybe you’ve lost your job, or had a loss of income that means default is imminent. Contact your servicer, and be ready to document your situation and the reasons why you need a loan mod.
- I have a second mortgage. Am I still eligible? Yes, but your second mortgage is not. (UPDATE: Your second mortgage may now be eligible)
- How do I know if my servicer is participating? Are all servicers required to participate? The program is voluntary, so there are no guarantees. The Treasury is offering financial incentives, however, so it is in most lender’s best interest to consider modifying your loan.
- What will my servicer do to determine if I qualify? They’ll determine whether your particular loan is eligible, ask about current income, assets and expenses. Then they’ll determine if your loan is more than 31% of your pre-tax gross monthly income, and if it is, they’ll figure out what it would take to get it below that. They’ll then do some calculations to determine if doing a loan modification is worth it in your instance. If it is, you’ll be put on a 3 month trial modification, and at the end – if you’ve made all your payments/etc – you’ll have your loan modified permanently.
- Will the modified loan include property taxes and homeowners insurance? Yes. Even if your prior loan didn’t have this, your modified loan will require it.
- How low can my interest rate go? Treasury is providing incentives to your investor to write the interest down to as low as 2%, if necessary to get to a payment that you can afford based on your income.
- What happens if that is not enough to get to an affordable payment? If getting a 2% interest rate still isn’t enough to get to you to below 31% of pretax income, your loan term may be extended, part of the loan can be forgiven or part of the principal repayment could be delayed.
- What happens if I am unable to make payments during the trial period? You won’t be eligible any longer for the home loan modification, although you might be eligible for other foreclosure prevention programs.
- How much will a modification cost me? There should never be a home loan modification fee or late fees that you should have to pay to receive a home loan modification. Back taxes and other fees that must be paid can be added to the loan balance. You can pre-pay those if possible to save interest over the life of the loan.
- Can Making Home Affordable help me if my loan is not owned or securitized by Fannie Mae or Freddie Mac? Yes. Making Home Affordable offers help to borrowers who are struggling to keep their loans current or who are already behind on their mortgage payments. By providing mortgage servicers with financial incentives to modify existing first mortgages, the Treasury hopes to help as many as 3 to 4 million homeowners avoid foreclosure regardless of who owns or services the mortgage.
- I heard the government was providing a financial incentive to borrowers. Is that true? Borrowers who make their payments on time on their modified loans will receive “success incentives”. For every month you make a payment on time, Treasury will pay an incentive that reduces the principal balance on your loan. The incentive will be applied directly to your loan balance annually and over five years the total principal reduction could add up to $5,000.
- How do I apply for a modification under the Making Home Affordable Plan? Contact your loan servicer at the phone number on your mortgage bill, but only after gathering all your financial documentation that you’ll need to prove hardship.
If you would like to speak to a housing counselor you can call 1-888-995-HOPE (4673). HUD-approved housing counselors can help you evaluate your income and expenses and understand your options. This counseling is FREE.
Have you called about getting a loan modification? Are you considering it? Tell us about your experience in the comments.
We had our loan modified by our lender. We had an ARM that went up to 10.5% last November. We started the paperwork for a rewrite in October, but were told that we had to wait for the ARM to adjust to really get the ball rolling. We were behind about 2 months at that time. It took 3+ months with a lot of paperwork, me following up weekly with our lender, and checking and double-checking the status. I was very resiliant with this. We couldn’t afford the new payment, and we had to show this. It wasn’t a hard thing to do but we had to keep at it and not give up.
Once we were within the last 30 days of the modification, I tried to call in a payment but was told not to because it would show we could pay, even though we were at that point 3 months behind, thus throwing us out of the modification program. Dumb rule, but you know we didn’t make that payment and then 3 weeks later our modification was done. We did save the payment we were going to send in because we were told there may be some fees to close the deal and there were (basically the total of one months payment).
In the end our mortgage is now a fixed 27 year note at 4.4%. Its very affordable and our payment dropped $480 a month from the original payment and dropped $890 a month from when our payment had adjusted up. We feel very fortunate to be able to stay in our home.
We didn’t have to go through HOPE but they told us if our lender gave us problems to contact them. We were fortunate that our lender worked very well with us, but like I said, it took 90 plus days and we did have to have some closing costs but we had it since we were putting money away to save up payments.
It can be done!
Greener Pastures says
It seems that – with some lenders at least – they are going to have to be pushed to be kept honest. Perhaps it’s just confusion, while plans get put into place.
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I tried calling HSBC asking for one, not because I was in trouble but why the heck should I pay 5.875% when they’ll let me pay 4% lol.
Told me that since I didn’t have an ARM loan I wasn’t getting the cheaper, easier modification but they’d be happy to discuss a Refi.
Disclaimer: this was wayyy back in Nov. so maybe its diff now.
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We have been trying unsuccessfully to modify our loan with HSBC for 2 years. Both my husband & I lost our jobs of 10 + years within 4 months of each other in 2009. HSBC downright refuses to work with us. Each time we have applied for a modification they have held the papers for 2-3 mths, and then deny us for a variety of reasons. This last time they told us that the investor (GMAC) will not change the term of our loan from 15 yrs to 30 or 35, will not lower our interest rate from 6.75 to anything else, and since we have a conventional loan they do not have to offer us HAMP (although they are participating in this program). We are both working but will never make the same income as we did when we qualified for this mortgage. In fact, I don’t think we ever should have qualified in the 1st place since it was a “no documentation” loan. Any suggestions?
Chris Harms says
I called Countrywide a couple of months ago to inquire about a loan modification. After giving my financial statement and hardship due to loss of income, I was told “just let the house go into foreclosure, we can’t help you”!! I was extremely disappointed to say the least, and incredibly taken aback with their lack of compassion. My attorney also tried on my behalf and was told they could not help me as I am still current! This is insane and totally unacceptable. I am so sorry I have given them 3 years of our hard-earned money and would have loved to refinance with a different lender but we have lost about 80-100K in value and can’t refinance. I have yet to find out if Countrywide will be participating in the “Making Home Affordable” program. I have submitted a “call me” request form several times on their website, but still nothing. What now??
In response to Chris Hams,
I also have a mortgage with Countrywide and we have suffered a loss of income from when we originally purchased the home and I’m now drawing disability. We have been living on our savings for quite some time and are still current on our payments but the well is just about dry and we are more than likely going to be forced to try and negotiate a short sale or let the house slip into foreclosure if Countrywide doesn’t want to play ball with us.
At any rate, I contacted Countrywide asking what options might be available to us because moving will be extremely difficult with my injury. It took a lot of phone calls over a series of several weeks but I finally did get some information out of them. The loan agent I spoke claimed he had just gotten out of their HASP meeting and had information so that he could begin qualifying us for a streamlined refinance.
The only problem with this is that I told him the reason for my call was that we are struggling to make ends meet and that the payment is too high. Even when we refinance to a 30 year fixed at 5.375% (currently at 6.375%) our payments actually went up slightly; doesn’t help us because we are having trouble paying the mortgage month to month. Not to mention the fact that there would be nearly 9k added to our 154k loan just to refinance (mind you many fees were waived because of the refinance being steamlined, but 9k?). It just doesn’t seem to make much sense in our situation.
I had to talk to someone in another department about loan modification who was extremely rude. She took my particulars (income, expenses, savings, etc.) and after about 20 minutes said we can’t help you. We have no options for you at this time. But before I could even respond she wanted to know when I would be making the next month’s payment.
Then I decided something didn’t seem right, what about Obama’s plan? Every time I mention the “Making Home Affordable Plan” I pretty much didn’t get a response, other than that doesn’t really apply here. I guess maybe since I don’t have an ARM things aren’t applicable to me?
So I contacted the HOPE Department and was able to speak to a counselor about our situation. I explained to him the only option that was given to me from Countrywide that seemed like a straight refinance but should have not have probably been offered due to the amount of debt we have in relation to our income. He mentioned our low income should have disqualified us from the refinance. Anyhow he took our information and was going to forward the information to Countrywide asking for them a loan modification under the “Making Home Affordable Plan”. He said it would take upwards of 3-4 weeks. I have since received an outline of the notes he took during our conversation so I’m assuming Countrywide has since received them also.
Maybe in a couple more weeks I’ll know if they are willing to work with someone on a loan modification that doesn’t have an ARM loan.
What is the definition of a hardship under the loan modification guidelines? Does a cutback in overtime hours and the fact that I now have two children 3yrs and 16mos. and making ends meet is very difficult. It really is difficult living paycheck to paycheck. I also have yet to file a tax return for ’08 sent in extension but I’m working on that now and prop. tax second installment is late and should be paid in approx 1-2 mos. Are these items critical before starting the loan modification precess or do I have to get them squared off first? Any help is greatly appreciated. thanks
Kimberly Denise Beverly says
I would like to see if you can help me with my home
Do you have a question that we can try to answer?
Ainsley Nobara says
My husband and I are looking to do a loan modification for our mortgage although our mortgage is $70 under 31% of our pretax gross income. Do you think our servicer will “let it slide”? We have a new baby and I am a new stay-at-home parent (so we are depending on just my husband’s income now). We are struggling to pay the termite renewal, baby diapers, food, etc. We are not behind on our mortgage payments, but we are stretched so tight and our house is worth 50k less than what we bought it for in 2005. Please offer some insight! Thank you!
Im working with a counselor at ACORN to discuss a modification. My current loan is at 37% of my gross income. THe 1st time the girl ran my numbers she left out my condo association dues and told me I was at 30 % I checked her work after we got off the phone I discovered the error and that I was at 37%. I discussed it with her and she said I was still not eligible because I had $375 GROSS money left over in my budget and they want my payment to be at least 38% of my income before they’ll look at my loan. WHat gives? DO they want me to pay 31% or less towards my loan or be paying 38% or more before they’ll help?? Am I to understand Im not allowed to have any money left over to save in my monthly budget?
Krystle – The trick to qualifying for a Making Home Affordable Loan Modification is to have a current “front-end” DTI of over 38%, and a proposed front-end DTI of 31%. In plain English, this simply means that if you divide your current housing expense by your gross income, it must be above 38% (currently). To calculate what your new mortgage payment will be, simply work backwards: Multiply your gross monthly income by 31%, subtract monthly taxes and insurance; this leaves you with your “affordable” monthly payment. Your lender will help you achieve this monthly payment by modifying your loan to a 30 year term or 40 year term, at the appropriate interest rate. Additionally, make sure that your bottom line net income expenses (including all bills and household expenses) are currently negative, and that after your proposed savings on the modification, your bottom line net income will be positive.
So this plan wants people to pay 31% of their income towards housing but all those people who are paying more than 31% but fall within 32%-37% are up you know what creek without a shovel? This sucks.
Thomas Mason says
We tried to get the 1st at 8.5 % fixed modified by US Bank and it was denied. We asked to reconsider and they have been doing so but it has now been three months. We were told this week that it could be 6-8 more weeks. HFC has our second at 10.5 % and they denied it. We asked why and were told they could not tell us. So much for help
rose wood says
Hi, i havea tax lien on my property from 2004 FROM THE IRS THAT I DID’NT REALIZE. I HAVE A WELLS FARGO MORTGAGE. I AM TRYING TO GET A LOAN MODIFICATION LOAN BUT THEY WILL NOT CONSIDER A LOAN AS LONG AS THERE IS A TAX LIEN ON THE PROPERTY. CAN YOU TELL HOW I CAN GET A LOAN MODIFCATION WHILE I WORK ON REMOVING THE LIEN? THANKS.
Lisa Richardson says
Did you ever get your loan modified? i have a client with a tax lien that cant refi were you able to get it done?
I was told that my net expenses should be positive by a couple hundred dollars. Is that not accurate? Right now my figures show -$300 per month with my old mortgage rate. Any help would be appreciated. I am submitting our hardship package tomorrow.
Am eligible for HAMP due to job loss and am current in mortgage payments, Have a few months savings. Can I put my house up for sale and still qualify? If so, should I list it now or after modification?
I submitted paperwork to Bank of America for the Making Homes Affordable Program under the Obama Administration in October 2009 for a modification. However, Bank of America has not contacted me to complete the processing of my application. Instead, they called me about a refinancing option that I did not apply for. When I asked Bank of America about my modiciation application, they said it had expired. I was very upset about this and called them again. When I called them again on November 13, 2009, they took my new financial information (bills that I currently pay and my income) and said it would take two weeks to process. Monday, November 23rd, 2009 will be two weeks. If I do not hear from them by November 23rd, 2009, what would you suggest I do? I have never been late or missed a payment since I have had a mortgage. However, December 2009’s payment is going to be difficult to make, so I need to settle this before December 15, 2009.
You replied to Krystle 9/1/09. It sounded like you are pretty familiar with how this loan modification process works. Can you please answer my question regarding whether or not I should be making my monthly mortgage payments. While I’m in the process of the Making Home Affordable Loan Modification. I’m already one month behind and will have to go out on a limb, borrow, to come up with this months mortgage. But I’m afraid of getting to far behind. I also heard if I become three months delinquent I may not qualify per the rules. Please respond and clarify Thank-You .
If anyone else can help by answering my questions it would be greatly appreciated.
Linda Stillman says
I am in the middle of a loan mod. through Wachovia [a previous World ‘Pick A Pay loan’]. Just waiting for an offer in the mail and calling them every week.
My question is:: Will my HOA dues be included in my new monthly payment?? I have researched this loan mod. program HAMP and I’ve seen on several sites that it WILL include the HOA dues. Please find this out for me, as Wachovia tells me that it is NOT true.
Lauren Baker says
I applied for modification in 9/08 originally.. in December they approved it I believe through the Hart program (I has stopped making my payments because i was struggling) and they sent me the paperwork but I never received because UPS couldn’t not deliver because en route they ran into a flood somewhere..I was not informed but in keeping in close contact..a month later they told me it was restarted again because I did not get the papers in on time (go figure)..now they told me I should know in another 2 months which brought me to March 2009..(still not able to make my payments now 6 months behind)and they told me that I did not send in the further income papers they needed..I was never informed by writing or by phone they needed something..anyway I was furious again..and it was restarted again..meanwhile in March I was placed on a medical leave and could no longer work because I needed a hip replacement so I was going to be out of work for a while..at this point I was still eligible for MHA because of the small amount of child support I receive ($4400/year)..it is now January 2010..I have had my hip replacement finally in August and I am ready to get a job and get back to work as a nurse (I am a single parent with a 6 year old) and after several calls to Countrywide(now Bank of America) through these months with not one manager, service person giving me the same answer twice.. they are still unable to tell me whether I am even eligible for MHA. I have been told it is still with the negotiator (and they have changed a few times in this time)..my whole life is on hold waiting to see what they are going to do with my loan/house..originally I owed 300,000.00 interest only, 1500.00 quarterly for taxes due to a septic lein/loan from the town and 57000.00 at prime for my home equity loan..now I am 28000.00 in arrears on my first mortgage and my home equity loan is up to date. The taxes and home insurance were taken over by Bank of America and escrowed..So anyway that is my sad story…still waiting…any insight or suggestions other than “start packing” would be appreciated!..Thanks, Lauren
UPDATE: Hi R..thanks for getting back..sounds familiar..believe it or not I finally got mine done by playing their game..I was and still am out of work..in January 2010 I did get to speak to my negotiator..at that time he told me get a job..you need an increase in income either by a job or a roommate..which both were nowhere to be found..I thought I would have a job by May I told him and I was to call back then..and he would modify my loan..In March..BAC..cancelled my modification..called negotiator to remind him of what he said and basically he doesn’t communicate to them so my application closed and BAC called and told me my modification did not go through and that I am responsible for the balance..meanwhile I had met someone we just hit it off and he basically moved in at the end of April..I had a bright idea in June..the negotiator told me I needed more income..well I called the negotiator (not customer service because they no nothing) and he said he wasn’t sure if having my roommate’s income of 900.00 would work but he would find out..he also told me if he was going to modify my loan he would have to try and reopen my original application..and he had to do in the next 2 weeks because he was leaving..the thought of starting this whole process over with a closed modification app..I thought I was gonna throw up..he checked with his administrator and as long as I could show a deposit of 900.00 going into my acct..every month x2 months..he could do it..I the required paperwork that he needed..bank statement..homestead act..etc..and voila..modification managed to get done the last day he was leaving..not the greatest of terms..owe now 346000. was 300000…will pay 1000. x2 years..then 1200..x 3 years..then in 5 years it will be conventional..2700.00/mo for 20 years..help!!! so I guess I will worry about it in 5 years..forget that I have a second mortgage with another lender ..and my house is probably only worth 270000..at this moment..but I got it done!!!Good luck and thanks for the well wishes on my new hip..still don’t have a job it is now Sept.2010..hopefully soon..Lauren
Yours is similar to our experience with the lovely and talented Ms. BofA. Them not delivering docs to you because of some extenuating circumstance (flood/weather?), canceling or declining your/their loan mod review and then *blaming it on you* are CLASSIC tactics of the lovely and talented Ms. BofA. They tell you one thing on a call with one rep then another rep tells you something slightly (or even entirely) different that same day or a few days/weeks later.
We haven’t been able to make a payment in 13 months but have been in the loan mod review process 4 or 5 different times during that time frame. I think we were never actually OUT of the process; they just decline us and immediately re-submit our account to be reviewed for “another” program. If I remember right they were reviewing our account for loan-mod programs specific to *conventional* loans for the first 6 to 7 months before they realized we had a govt-backed loan!?!?! They kept saying we didn’t qualify for those programs!?!?! To quote a man who I believe could give BHO a run for his life in 2012 – “Doh!!!” (thanks, Homer) So much mis-communication on their part.
Many times I have been told I *can*, *should* or *must* do a particular thing (e.g. FAX my financial document package into them ASAP) only to call back and have another rep tell me “you CAN’T do that” (e.g. you CAN’T FAX your package in, we can’t accept FAXed copies!?!?! Learned on a subsequent it was a gov’t regulation on our type of loan!?!?!) Many conversations have consisted of spending the first 10 to 15 minutes helping yet-another-rep-who-knows-nothing-about-our-mortgage-account get up to speed on where we are at in the process.
While we are grateful to still be in our house and grateful the lovely and talented Ms. BofA is still wanting to figure out a way to help us keep our house, the process has been excruciating to say the least. I would never knowingly, willingly do business with the lovely and talented Ms. BofA ever again for any reason whatsoever. There are too many good local credit unions out there who are offering mortgages now.
The collections department continue to call many times each month to ask if/when I can make a payment. I have learned I need to answer EACH time they call or CALL THEM at least 2x per week. Their communication leaves much to be desired; their automated dialing system routinely calls me and hangs up on me BEFORE I even can get to talk to a human. I have also had many times when I called them (back) and their automated phone answering system has hung up on me!! After multiple requests to speak with a supervisor, etc. I found out they are still working out the bugs of the new computerized phone/dialing system.
Some things that may help your situation –
1. I have called them enough times to know that if I talk to someone and something does not sound right I either hang up and *immediately* call them back to get another customer service rep OR I immediately, politely yet FIRMLY ask to speak to the supervisor, manager or division vice president currently on duty. Threatening to start calling Executive Vice Presidents at all hours of the night has also magically produced employees who provide accurate, consistent and helpful answers to my questions.
2. if you haven’t done the following already, start NOW!
A. Create a folder of ANY and ALL of the paperwork related to your loan mod and keep it somewhere safe. This is a dot-your-I’s & cross-your-T’s process.
B. Start documenting ALL correspondence with them – create your own Call Log in Excel, or whatever works for you and take copious notes in it DURING and RIGHT AFTER each conversation, or record EVERY conversation you have with anyone employed by them (BTW, I LOVE how they say “this call may be recorded for quality assurance” each time I call them!!! I have come back with “yes, this call may also be recorded to MONITOR BofA’s “quality assurance”)
PS: Be diligent and persistent with them!!! One of the lovely and talented Ms. BofA’s reps told us recently they are working hard to help us keep our house.
PPS:Great to hear of your new hip; God Bless you in your nursing career!
After 1 year 3 months I received a Final Loan Mod. with Chase. Keep calling emailing. It was very long stressful sleepless nights. I just got the fed ex package Friday. They gave me a 3.99% for 5 years. But, by the time they added up there fees and whatever they could dream up it added another 30,000 to my loan. But the payments are reasonable and I’ll probaby be dead before it is paid off anyway. But keep calling email keep names and send in doc they will say they never received them it is a stall tatic but do it anyway and make sure your docs are complete. Our mod was MHA. Iknow what all of you are going thru I can actually sleep all night now and wake up with a good attitude. good luck
We were given a loan modification back in July/08, that included taxes and insurance. The basic terms was for us to make the 3-trial payments and afterwards they would continue the monthly payments for 30 years. The new monthly payments was great! However, after making payments for two of the three months they never made the payments to the insurance company or to the county.
Also my payments were interrupted after my insurance company previously had our permission to deduct our monthly insurance payments and they continued to do so, causing our mortgage payments to bounce and we were accessed fees. Now after contacting Litton Loan and my insurance agent neither one had a record of an escrowed account ever being established. Yet we’ve been receiving monthly invoices that clearly indicated the separation of the monthly payment and escrowed payments. So they’re now trying to foreclose on our property on 2/26. We sent them all the info necessary for a MHAP back in Dec. and they refused to respond back to me. So I am now trying to get them to once again consider another loan remodification after ceasing payments back in Nov., but, this time under the MHAP. So I’ve contacted a community action agency in my area and after (1) conference phone call… they’re working on another loan modification. Make sure they are following through with your agreement!!!!!
Also understand that filing Bankruptcy Chapter 13, will/can save your home and give you time to catch up “IF You Have Income,” or you can file Chapter 7 and tell them to keep the house, take your funds and start over new and give yourself a new direction and outlook on life, don’t look back. remember the house is in foreclosure not you… tough times requires tough measures… we are all tough we’re dealing with the bankers who we bailed out… let them have it back if you can’t afford it, let them eat the lost. better them than us.
My situation, divorced single mom, income 1800.00 per month. Expenses 908 mortgage, 112.00 property tax, insurance 60. ,all per month. cc payment 300.00, 75.00 student loan, utilities /living expenses 680.00- total expenses per month 2135.00 leaves me about 335.00 short per month. Also owe back taxes on the home about $4500.00. I offered to pay 2000.00 to help pay off late fees, taxes, charges. My loan balance is 130,000, my home value is about 78,000. I was offered a 3 mo trial @ 520.00 per month. What are the chances that Select Portfolio Svs. will permenantly remodify my loan? What else can I do?
I have been trying to get a loan modification done since last April. My husband lost his job Nov 2008 and then we had our 2nd child a few days later. So were were both out of work for some time. My husband has to stay home with our son due to the cost of childcare. Then my son has some medical issues, and I had some also. Our families have helped us as much as they could, but no longer can. Then on top of all this (we were behind in our taxes but was working on it) the mortgage company when and paid 2008 and 2009 taxes raising our payment (with out taxes $1606) to almost $4000 a month starting this month. Now when I call and ask about the loan modification they say value of the house is not passing. Nobody can tell me what that means, but only that they have to do an appraisal. The person I talked to today said that means it could be coming in too high or too low, so it might not qualify for the loan modification. So we have to wait for an appraiser to come (which he also said that they will not be coming inside and we will not know what it was appraised at because they are paying for this to be done.) So I am not sure what is going on, what does this mean? Can someone please help me?!
We heard about the Home Afforable Modification Program and called for info. They said they would send paperwork in forty days. When we found out it would negatively affect our credit score, we threw out the paperwork, and decided to try to refinance instead. We have wonderful credit, and never expected a problem. We had our appointment this morning, and 2 of the 3 major credit report companies are saying that we are currently enrolled in the hamp program! WE NEVER SIGNED ANYTHING. We have been paying the normal mortgage payment each month, nothing has changed. What do we do now?!
Grace Muqaddim says
I applied for a Loan Modifications December 2009. My trail period was Jan-Mar 2010. I was suppose to get a FedEx package to complete but it didn’t arrive until April. By that time my trail period was over but was told to continue to send in the particle payment. By May I begin getting calls from a debt collector and was told this was routine, to continue to send in my particle payment, my loan was still being reviewed. I have since received a certified letter saying if I do not send in $5,000 by July 9 they (the lender) plan to foreclose on my home. They sent me a second FedEx package to complete and return by the 10th of July. The last conversation I had with Making Home Affordable, I was told the individual who instructed me to send in a particle payment, had no authority to do so, that I should not have sent in a particle payment without getting something in writing, did I call the HUD Agency, maybe they could help me, . . . and on and on. I’ve since contacted HUD to get a counselor because I want to stay in my home of 13 years. I recently retired and can’t afford all my monthly expenses. I’m hoping this will all work out and soon.
About 25+ years ago we were paying on an FHA loan. We were given really low rates, but learned if we did stay with that FHA loan for the 30 years, we would, after it was paid off, have to continue to pay the government (FHA) payments that would allow them to recover losses due to the low rate they had given us 30 years earlier. That was 25+ years ago and through FHA, but I think that’s how our loan had been set up. We did not stay with FHA and got out from under them after a few years. (we let them have the house back is what actually happened… Long story)
So with all that said:
Is the current Obama plan different?
I recently retired after 30 years with the State of Ohio. My income went from about $80,000.00 a year to $36,000.00 a year. I retired partly due to having the time in (I’m 51 years old) and partly because of my wifes health.
We are currently with Bank of America (BOA) and about 5 years into a 30 year mortgage. We started with Countrywide, but they were taken over by BOA a few years ago. We actually have what were told is a good loan with them. 30 year fixed at 6.875% and BOA pays the PMI. Our payments, including taxes and insurance are $1,235.00 monthly. The original mortgage was $161,000.00 (the out of town appraiser said our home was worth $174,000.00 5 years ago) Two years later our house is only worth $143,000.00. (that’s BOA’s figuring anyway)
I’m tempted and hopeful to consider the Obama “keep my home” plan, but my wife gets sick to her stomach when considering it because of the government involvement. Need we be concerned?
If we would get a loan modification through Obama and BOA? Would our mortgage debt be paid in full after the close of the new 25 or 30 year agreement / adjustment?
I think my credit record is very good right now. Will it be affected by applying for, being approved or going through with the Obama plan with BOA?
By the time our mortgage and other bills are now paid we have about $450.00 left each month for groceries, fuel, etc. It goes quicker than one would think.
I’ve said a lot (here today) and have tried to research this program the same. BOA seems very willing to start the process for me, but my wifes gut feeling (or intuition) causes great apprehension.
Can someone at this website or someone reading this please reply to our concerns? Thank you Bible Money Matters for this site and information.
Can you qualify for a loan modification or refi after sucessfully filing Chapter 13 Bankruptcy? Even with the payment to the courts we are barely surviving. We live paycheck to paycheck and are one unexpected expense from losing everything we worked our entire lives for. I recently lost half my income due to a necessary job change which forced us to file bankruptcy in the first place. We are three years in on on a 10 year interest only at 6.5. We are under water when you add the first and second together. We are also current on our mortgage and have never been late. Is there any help for someone in our situation?
My husband and I started the process of the Making Home Affordable Plan (MHAP) back in October 2009; our first “Trial Payment” was due December 1, 2009. Our lender was Countrywide who is now BOA, what a nightmare! We are still making trial payments. I have notes of all the phone conversations and confirmation numbers for all the monthly payments we’ve made.
Since it has taken so long, our credit is so bad we probably couldn’t get a loan anywhere and we didn’t know this would be effecting our credit; nothing we can do now about it but that just puts the icing on the cake!
Today, 1/3/11, I called to make the payment and I asked if our status has changed. The guy looked and looked at all the notes and said it didn’t look that way but he could transfer me to the MHAP department/area. He gave me the number incase we were disconnected and I said not to transfer me, I used to talk to them and they told me I was denied MHAP and they couldn’t take my monthly trial payment amount so I had to talk to the “decline department” (that’s who I was talking to today). Here’s the real laugh….the decline department doesn’t show us being declined everything is still in review but we were denied once. I said I heard that before but we haven’t received ANYTHING from BOA. Only documents we received were in the beginning dated December 1, 2009.
So I’m not sure where to go from here. The guy today said to wait and continue the monthly trial payment which is great financially for us, it’s doable with only my husband’s income but our loan is also over $10,000 behind. Any suggestions? My family said I should contact the local news station but really, what good would that do?
Whatever information anyone has is greatly appreciated!
What if you closed 3-30-09? What help is out there for you?
mike davis says
Anyone thought an having audit performed on your loan just to maybe keepem honest an showem an example of the b.s paper work loan docs they barried us in at inseption of loan. Call AMT mortgage auditors. this was introduced to me after my app. for loan modification to fixed rate was denyed by hamp .due to my debt to ratio is too low . lol what does that havta do with requesting a fair resonable fixed rate. never behind always pay over & above payment option 2 principle & intrest . AMT ph.# 877 762 0725 good luck its a start for progress anyway !!!
Edie Hammond says
Yea we tried working with Citibank to get a modification to our 7% loan. We submitted our paperwork 5 or 6 times over a period of 7 mo. They advised us not to make our payments for 2 mo so it would look Like we were having a hardship. We nerve were able to talk to the same person and no one knew what was going on. Then after all that time they said they could not help us because they didn’t get our paperwork. They then turned us over to collections for the two payments that we had already caught up on. We tried to get them to have this taken off of our credit because our scores were now down because of this. Never happened. Went to a lawyer. He wrote them a letter informed them they needed to fix this because they had damaged our credit. They responded with an apology letter to us and that they had taken care of it. Well it is still on our credit.
This site should ALERT commenters that no one is available to address borrowers’ specific questions. There are countless borrowers here asking for answers. Why can’t the moderator just state that comments are encouraged but “we cannot promise to address or respond to individual concerns.” It’s just that simple.
I know lots of ppl who bought 3000 to over 4000 sq feet homes in NJ and other states…. Who went from a $5000 payment to a $1300 or $1500 a month payment who are living large because they knew how to work it!! Back in 2000 I had to sell my house because our business wasn’t doing well, I pay my income taxes… These ppl don’t not really, I don’t have a three thousand sq feet home … My home cost me $600,000 in NY…. I can’t wait for the banks to call in the note on their houses …
Deanna Wheeler says
I hope you can answer this. I was trying to get a loan modification. We owe 98,000. They want to charge me 98,000. Then 63,000 they 3% which will take it to 260,000. For 40 years. Can they do that. I am want behind because of health and bankruptcy. Can they do that.