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Earendil

Derogatory remarks after loan modification

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Hello all,

 

We started a loan modification in late 2017 because I lost my job after Hurricane Irma.  For some reason, the process took nearly 9 months until we got to the trial payment period.  We made all our trial payments on time as required and signed all the paperwork in October.  Two months ago, our credit scores dropped roughly 100 points each.  According to Equifax and TransUnion, the payments during the trial period were marked at 120 days late.  I sent a letter of dispute to our mortgage company and they responded that everything was in order.  When I initially talked to them on the phone, no one could explain to me why this happened and they told me I needed to send this letter to have it investigated.  I'm not really sure what to do at this point and don't want to wait seven years for it to fall off our reports.

 

So, on a scale of 1 to 10, how screwed am I in regards to getting this fixed?

 

Thanks

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In those nine months, were all payments made on time and in the full amount due? 

 

A quick online search suggests that the Fed has put out guidance that reflects some modifications could negatively impact scoring.  It appears that much depends on whether the contractual agreements between the parties actually called it a modification pursuant to HAMP or whether it is some other manner of notations related to partial payments. 

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HAMP stopped a few years ago. But if you weren’t paying your full normal payment you were late. Your loan terms didn’t change until the mod was complete and signed.

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The thing is, they wouldn't accept any payments while we were in the trial period.  I wanted to pay them, in fact I called a couple of times to try to make the payment. But they wouldn't accept it.

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On 3/9/2019 at 7:44 AM, Earendil said:

The thing is, they wouldn't accept any payments while we were in the trial period.  I wanted to pay them, in fact I called a couple of times to try to make the payment. But they wouldn't accept it.

That would tend to suggest that the reporting IS correct.  It certainly sucks that they would not accept the payments, but the reality is that payments were NOT being made in a manner consistent with the mortgage terms. 

 

Hopefully you have something in writing that demonstrates you were attempting to make payments and that they put in writing that they would not accept payments.  The phone is NOT your friend on matters of this nature, precisely because there is no record. 

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I've read more than once where people have stated that a servicer wouldn't entertain a modification as long as the payments were current.  Not sure if this is true in OP's case, or if it was, if OP was even told this explicitly.  

 

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