Has anyone received a PERMANENT modification following the 3 month trial? Options

[cb2cb]

I just spoke to Wells Fargo, they say that the 3 month trial period delinquencies will stay on your credit as any other late debt, 7yrs to erase.

If you enter the trial modification period while current, they should report you "current but on a modified payment". If they do report you late and subsequently you are approved for permanent modification, you can dispute the late reporting and have it corrected.

If you are not approved after the trial period, then your lates will probably remain, but you can still dispute them and see what happens.

Another thing they said is that the interest rate they offer is different on every file, not everyone gets that 5yrs fixed then rate hike.

All HAM modifications get the 5 year fixed rate, which then increases by 1% a year until it reaches the "life-time cap rate" that will remain fixed for the remainder of the mortgage term.
But yes, most people get different rates for the first 5 years, it all depends on their gross income and mortgage principal amount.
Also, the life-time cap rate will only be set at the time the permanent modification is approved. So depending what that rate is at the time, it may be lower or higher than 6%. If the cap rate is higher than your current rate, they may cap it at your current rate but I'm not sure about that

Also, that once the trial period is over they evaluate your file to see if you qualify, I know many of you know this but that really stinks because why go thru the trial period cause even if you pay on time you might not be qualified.

Yes, this part really stinks because there is no way of knowing if you will qualify at the end of the trial period or not. That is why it is very important to give accurate financial information (especially income, savings, investments and rentals) from the beginning of the process.

Your other option may be MHA refinance as long as you're current on your mortgage payments. Unlike regular refinance, you won't be disqualified due to low income or assets.
Check this link to see if you qualify for a refinance: http://www.makinghomeaffordable.gov/refina...ligibility.html


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This post has been edited by cb2cb: Aug 13 2009, 06:38 PM

[Googie]

[tanschwan]

there are a lot of companies out there that do these modifications and know how to fight for you. Sure, there are some grimmy companies out there trying to take advantage of people's hardships and most of them are the ones that caused these problems in the first place!

There are also a lot of great companies out there that are very experienced with doing modifications at a reasonable price (not the $7000 that a lot are asking). Make sure you find a company that will pre-qualify you before asking for any money.

Since the OP is asking about the Making Home Affordable Loan Modification program, if ANYONE asks for ANY money they'd be in violation of the law.

The FTC, Dept. of Tres, State Govt's, etc. have been actively prosecuting companies that are doing this. http://www.makinghomeaffordable.com/pr_040609.html

My advice, hire an attorney experienced in real estate law/loss mitigation/loan modifications. Attorneys can ask for the fee upfront...it's called a retainer fee. Just make sure they are licensed in your state, there is an application process, and some of them will even offer a money back guarantee in writing. The Better Business Bureau is worthless in this industry IMHO. As for doing business with attorneys, they are held accountable by their state's and American Bar Associations. Hiring a competent, experienced, and ethical (do your research, get referral) attorney to negotiate a modification on your behalf will make you a priority with your lender. Trying to work it out with your lender on your own (because it's free) will likely lead you to foreclosure and sheriff's sale. Not in every case, but in too many cases because the lenders/banks/servicers are not staffed to handle the millions of requests they are receiving for modifications. It is also likely that a good attorney will negotiate better terms for you than what the lender would willingly give you directly. Remember, lenders are going by a percentage of your income and not taking into consideration the big picture such as your monthly expenses combined, home value, etc. Lender are extending terms which means they are increasing your principle balance. A lot of distressed homeowners maybe don't care, because they are looking at "today" and as long as they are saving a lousy couple hundred dollars, they are okay with it for the moment. Working out a modification with the lender is free? I think not. Not in the long run.

[NAN101]

Was denied by SPS today - now they say I make too much, even though the entire agreement made it sound like it was approved... 3 month trial my ass.... this was a "get the gov't off our backs then we'll deny you payment plan"

Which is what happened....

A new update that just came out - denial codes. It's supposed to be "up and running" by Oct 3rd. If you're denied, a denial code must be put in and provided to you and Fannie Mae. Then the "2nd look" process kicks in.

Was this a HAMP? I don't think making too much can be a factor unless your payment was already at 31%, or you didn't have an accepted hardship?

It's really sad that 8 months after the program was announced and touted as the relief homeowners needed, the lenders are still yanking everyone's chain.

[tanschwan]

Was denied by SPS today - now they say I make too much, even though the entire agreement made it sound like it was approved... 3 month trial my ass.... this was a "get the gov't off our backs then we'll deny you payment plan"

Which is what happened....

A new update that just came out - denial codes. It's supposed to be "up and running" by Oct 3rd. If you're denied, a denial code must be put in and provided to you and Fannie Mae. Then the "2nd look" process kicks in.

Was this a HAMP? I don't think making too much can be a factor unless your payment was already at 31%, or you didn't have an accepted hardship?

It's really sad that 8 months after the program was announced and touted as the relief homeowners needed, the lenders are still yanking everyone's chain.

Unfortunately working with the lender (w/out legal representation on your side) just continues to give them the upper hand. If the lender feels that you make enough money to cover your mortgage and other monthly expenses, they will deny you w/out further investigation. Keep in mind, these banks have millions of modification requests coming in. Customer service/satisfaction is not at the top of their priority list regardless of what they want you to think. The denial codes system IMO is just more bureaucratic red tape. I know of a lady that tried to modify through her lender and they denied her because after looking through her bank statements, determined that she was spending too much on groceries and if she cut back on the food, she could pay her mortgage. This lady has 6 kids to feed, but of course this is of no concern to her lender. I've said it before and I'll say it again; hire a reputable, knowledgeable, and experienced attorney in the loan modification/loss mitigation field to negotiate a modification on your behalf. Two things to pre-qualify: hardship (reason for falling behind on payments) and that you are employed or have a consistent income such as SSI, disability benefits, pension, etc. (unemployment doesn't count)

[MrNeef]

What if someone did a loan mod with the lender BEFORE the Obama plan and is current on it? My fiance is only current because I come up with the difference and help pay. But her income is $2300 a month GROSS and our home payment is $1800+$140 for association.

So she is at 85% of her GROSS INCOME.

We tried calling BoA and asking for a copy of our loan mod docs and everyone there tells us they do not have them anymore which is BS!

I am about to pay this fee to have a forensic loan audit. I was informed that pretty much any sub prime loan written in the past 5 years will have some sort of violation and that should give me leverage against the lender.

Thoughts?

[Gryffindor]

What if someone did a loan mod with the lender BEFORE the Obama plan and is current on it? My fiance is only current because I come up with the difference and help pay. But her income is $2300 a month GROSS and our home payment is $1800+$140 for association.

So she is at 85% of her GROSS INCOME.

We tried calling BoA and asking for a copy of our loan mod docs and everyone there tells us they do not have them anymore which is BS!

I am about to pay this fee to have a forensic loan audit. I was informed that pretty much any sub prime loan written in the past 5 years will have some sort of violation and that should give me leverage against the lender.

Thoughts?

There is nothing barring your fiance from trying to obtain a HAMP loan modification.

The first step would be to find out who your lender is (who owns the note & is usually different from your servicer [the entity you send your monthly payments to]).
If your lender is Fannie Mae or Freddie Mac your lender/servicer is required to participate in the HAMP program. If the loan is FHA, the government recently added what is called a FHA-HAMP program.

You can go to http://www.makinghomeaffordable.gov to check if your fiance's lender is participating in the program.

The next step would be to contact the Servicer (the entity you send the monthly payments to) and ask to enroll in the HAMP program. They should provide you with a fax number in which to send your financial information. They will also take preliminary financial information over the phone. OR, you can contact the Homeowners Hope Hotline at (888) 995-HOPE. This will connect you directly with a HUD counselor who can also help to get the ball rolling.

From there you should wait a couple of days and then call the Servicer back to see if they have received the information you faxed or that your HUD counselor submitted. Once they confirm they've received the documents it becomes a waiting game - usually 45-60 days from the time they receive your documentation to the time (if they decide you qualify) you receive your Fed Ex package containing your HAMP Trial Loan Modification documents.

[MrNeef]

What if someone did a loan mod with the lender BEFORE the Obama plan and is current on it? My fiance is only current because I come up with the difference and help pay. But her income is $2300 a month GROSS and our home payment is $1800+$140 for association.

So she is at 85% of her GROSS INCOME.

We tried calling BoA and asking for a copy of our loan mod docs and everyone there tells us they do not have them anymore which is BS!

I am about to pay this fee to have a forensic loan audit. I was informed that pretty much any sub prime loan written in the past 5 years will have some sort of violation and that should give me leverage against the lender.

Thoughts?

There is nothing barring your fiance from trying to obtain a HAMP loan modification.

The first step would be to find out who your lender is (who owns the note & is usually different from your servicer [the entity you send your monthly payments to]).
If your lender is Fannie Mae or Freddie Mac your lender/servicer is required to participate in the HAMP program. If the loan is FHA, the government recently added what is called a FHA-HAMP program.

You can go to http://www.makinghomeaffordable.gov to check if your fiance's lender is participating in the program.

The next step would be to contact the Servicer (the entity you send the monthly payments to) and ask to enroll in the HAMP program. They should provide you with a fax number in which to send your financial information. They will also take preliminary financial information over the phone. OR, you can contact the Homeowners Hope Hotline at (888) 995-HOPE. This will connect you directly with a HUD counselor who can also help to get the ball rolling.

From there you should wait a couple of days and then call the Servicer back to see if they have received the information you faxed or that your HUD counselor submitted. Once they confirm they've received the documents it becomes a waiting game - usually 45-60 days from the time they receive your documentation to the time (if they decide you qualify) you receive your Fed Ex package containing your HAMP Trial Loan Modification documents.

Thanks..sorry OP for the intrusion.

Tried calling BoA again today, who also services it, and they still claim they cannot "print" a copy of the loan mod we did in March of 2009 because it doesn't allow them.

According to the MHAP, her payment should be close to $700/mo, which would GREATLY help

[tanschwan]

What if someone did a loan mod with the lender BEFORE the Obama plan and is current on it? My fiance is only current because I come up with the difference and help pay. But her income is $2300 a month GROSS and our home payment is $1800+$140 for association.

So she is at 85% of her GROSS INCOME.

We tried calling BoA and asking for a copy of our loan mod docs and everyone there tells us they do not have them anymore which is BS!

I am about to pay this fee to have a forensic loan audit. I was informed that pretty much any sub prime loan written in the past 5 years will have some sort of violation and that should give me leverage against the lender.

Thoughts?

As long as you've been current since the last modification, you can do another mod if you qualify.

I think a forensic audit of your closing docs is a great idea, especially if your loan was done within the last 7 years. The chances are good that they will find violations or discrepancies that prove predatory lending or fraud took place. Attorneys will use this as leverage in negotiations if necessary. Just make sure that whoever you hire to do a forensic audit has a good record and will provide you with a copy of the audit. Banks don't want to open themselves up to lawsuits or if word gets out, class action lawsuits so they would rather settle peacefully. Good luck!

[cb2cb]

Thanks..sorry OP for the intrusion.

Tried calling BoA again today, who also services it, and they still claim they cannot "print" a copy of the loan mod we did in March of 2009 because it doesn't allow them.

According to the MHAP, her payment should be close to $700/mo, which would GREATLY help

No problem.

Did BoA actually modify her payments back in March and was she paying a reduced amount?

What was this reduced amount? What were her original mortgage payments, including taxes, insurance and HOA fees?
What is the amount of the first mortgage (is there a second)? Is the 1st mortgage Fannie Mae owned? When was the house purchased and for how much? What do you estimate the house to be worth today?

The HAMP loan modification is not as simple as just taking 31% of gross income. There is more to consider.
If you want to give some details on the above questions, I will run the numbers to have a better idea if she would qualify for a HAMP mod.

As far as a forensic audit, that's a long shot and can get pretty expensive.

[sirrowan]

Who actually successfully receives these Mod's and stays out of foreclosure? Seriously. They just seem like a lien/Note perfecting scheme to me.....................

[cb2cb]

Ok, for those who were asking, you usually do get a substantial hit on your credit score of about 90 Fico points during your trial period.

This will happen 2 to 3 months into the trial period, when they report you being on reduced payments.

[Gryffindor]

I can't even get my servicer to report that I'm on a trial period mod. Instead they keep reporting me as late even though I've never been late on any of the trial mod payments. They also have not applied a dime of what I've paid in towards any of my payments (as they're supposed to under HAMP guidelines).

I'm a bit concerned at this point as my property taxes are due at the end of this month. They have more than enough money to make the payment IF they would simply apply my payments.

[toopooor]

Ok, for those who were asking, you usually do get a substantial hit on your credit score of about 90 Fico points during your trial period.

This will happen 2 to 3 months into the trial period, when they report you being on reduced payments.

Is this with lates reporting or just the TL marked as modified? Hubby is in the upper 700's, i'm in the low 700's and I'm worried lates will start the dominos falling - rate jacks and closures.

[cb2cb]

Ok, for those who were asking, you usually do get a substantial hit on your credit score of about 90 Fico points during your trial period.

This will happen 2 to 3 months into the trial period, when they report you being on reduced payments.

Is this with lates reporting or just the TL marked as modified? Hubby is in the upper 700's, i'm in the low 700's and I'm worried lates will start the dominos falling - rate jacks and closures.

The above decline in FICO does not include any lates.

Been current on everything, no lates, no other derogs on anything, secured or otherwise.

The account still shows as current and "pays as agreed" . So all it took to lose 87 FICO points was this:

Description: "FANNIE MAE account
Arrangements made with credit grantor to make partial payments"



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This post has been edited by cb2cb: Oct 22 2009, 01:01 AM

[cb2cb]

I can't even get my servicer to report that I'm on a trial period mod. Instead they keep reporting me as late even though I've never been late on any of the trial mod payments. They also have not applied a dime of what I've paid in towards any of my payments (as they're supposed to under HAMP guidelines).

I'm a bit concerned at this point as my property taxes are due at the end of this month. They have more than enough money to make the payment IF they would simply apply my payments.

Call again and ask to speek to a superviser.
Explain what's going on and ask if he/she can help you.
Ones the trial payments equal or exceed your regular payments (including escrow), they should apply them.
Also they should not be reporting you late, but on "reduced payment". This eventually should go away if you get the final mode.

[Gryffindor]

Call again and ask to speek to a superviser.
Explain what's going on and ask if he/she can help you.
Ones the trial payments equal or exceed your regular payments (including escrow), they should apply them.
Also they should not be reporting you late, but on "reduced payment". This eventually should go away if you get the final mode.

Last Monday when I checked online my workout status had changed to Approved! On Wed it changed to "No workout information found for this account". I called to check the status and our mod is currently with the underwriter. I'm guessing that the final mod documents are being drawn up as they had an expected completion date of 11/6.

I'm sure once the mod has been drawn up on their end that they'll apply the payments. They did pay my property taxes so I now have a negative escrow balance. That should at least raise a flag somewhere that there's money in suspense that can be used to remedy the deficit.

I'm not too terribly concerned about the incorrect credit reporting at this point. It's showing that I'm 4 months behind on all 3 CRA's, which is incorrect reporting. However, since I had defaulted on all of my credit cards I think this will help to keep the CA's at bay, at least for a little while.

I'll eventually work on getting it cleared up on my credit reports but for now the derog info is actually probably more beneficial.

[ladyran]

Gryffindor - read your mortgage note - they can not put funds in a suspense account - that can be a breach of contract. Funds MUST be applied as outlined in the mortgage note usually in section 2:

all payment accepted and applied by lender shall be applied in the following order of priority:

a. interest due

b. principal due

c. amounts due under section 3 which usually is escrow of funds

Any REMAINING amounts shall be applied first to late charges, second to any other amounts due and then finally to reduce the principal

There is nothing in mortgage notes that says they can keep your payment and put it in a suspense account - total BS!

Send them a letter demanding that they apply the payments as date received as outlined under the mortgage note. If they do not apply the payments as outlined you will have no way to determine what is correctly owed and therefor you can not possibly catch up your mortgage payments.

Set your ground work and paper trail just in case things don't pan out like you hope they do.

[cb2cb]

Gryffindor,

Looks like you're close to the finish line.
If everything matches and nothing is missing, the underwriter will forward your file to the "closer" who will prepare and send your final mod docs.

When did you start this process and when did you receive your pre-approval docs? How many trial payments have you made?

Keep us informed of your final process.

Gryffindor - read your mortgage note - they can not put funds in a suspense account - that can be a breach of contract. Funds MUST be applied as outlined in the mortgage note usually in section 2:

all payment accepted and applied by lender shall be applied in the following order of priority:

a. interest due

b. principal due

c. amounts due under section 3 which usually is escrow of funds

Any REMAINING amounts shall be applied first to late charges, second to any other amounts due and then finally to reduce the principal

There is nothing in mortgage notes that says they can keep your payment and put it in a suspense account - total BS!

Send them a letter demanding that they apply the payments as date received as outlined under the mortgage note. If they do not apply the payments as outlined you will have no way to determine what is correctly owed and therefor you can not possibly catch up your mortgage payments.

Set your ground work and paper trail just in case things don't pan out like you hope they do.

ladyran,

Reread the bold type in your own post. You describe the application of funds if the payments are accepted and applied by the lender.

The servicer does not usually apply any payments which are less than the regular monthly payments due. Any such "short" payments are placed into "unapplied funds".
All trial payments received are placed into the unapplied funds. Once these funds equal or exceed the regular payment amount, then they’re applied as regular payments. Any leftovers remain in unapplied funds account.
In Gryffindor's case (and I'm sure in other people's cases as well) because the servicers are so backed up, the accumulated unapplied funds have not yet been credited as regular payments.
This will be corrected either before or after the permanent modification, when all the funds in the unapplied funds account will be applied to the outstanding balances and any remaining amount will be added to the back of the modified loan.
A phonecall to the servicer asking them to make sure the payments are reported and applied properly, usually corrects this.


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[ladyran]

cb2cb,

I understand your reasoning and know first hand the way they are doing things - however I respectfully disagree with their ability to do things this way. It is a breach of contract to apply payments in any manner other than set out in the note. IF they accept any funds then they must be applied per the note, not parked in an unapplied funds section not addressed in said mortgage note. The key here is "accepted and applied". The only way not to accept the funds is to return the funds.

[Gryffindor]

Gryffindor,

Looks like you're close to the finish line.
If everything matches and nothing is missing, the underwriter will forward your file to the "closer" who will prepare and send your final mod docs.

When did you start this process and when did you receive your pre-approval docs? How many trial payments have you made?

Keep us informed of your final process.

I started by calling BofA back in May. The same day after getting a lot of runaround with BofA I called the Homeowners Hope line listed on the top of the MHA webpage and spoke with a HUD counselor.

I received my Trial Mod docs 7/2.

I've made 4 trial payments so far.

[NAN101]

YES!! I received my final mod docs yesterday by UPS.

I made my 3rd trial payment Nov. 1st. Of course, this was the 3rd "official" trial payment. Prior to that I had apparently been making "practice" trial payments.

My final mod payment is actually $226 less than my trial payments.

HAMP modification -

Orig terms
$264,000 @7.75% ($2387/month PITI)

New terms
$259,600 ($1765.82/month PITI)
Years 1-5 @ 3.125%
Year 6 @ 4.125%
Then 5% remaining years for life of the loan

Aurora is my investor and servicer - non-GSE loan.

This, of course, was on my 1st mortgage. My 2nd mortgatge modification still sits in limbo/pending. I was told by underwriter in Sept that they were waiting to see what happened with the first.

Now that my nightmare on my 1st has come to an end, I need to gear up for the 2nd. It's been a LONG process and I never thought they'd come through, but they did.

[Gryffindor]

I'm still waiting on mine. I've now made 5 trial period payments to BofA.

I received a Fed Ex early this week which asked for documents they've had for over 2 months and how they were going to grant a one month extension. I called them immediately and had her check our file and she found what they said was missing.