Blown Mortgage - Latest Comments in Loan Modifications on Your Own

Re: Loan Modifications on Your Own

cliffcapdevielle — Wed, 26 Aug 2009 20:00:10 -0000

I am an attorney in California helping consumers with Bankruptcy and Loan Modification issues. I want to get the word out about some problems I am seeing with the loan modification applications.

Contrary to the recent news, banks are offering loan modifications. However many of the applications are not accepted for these reasons:
1. The application is incomplete. In contrast to the past, banks require perfect documentation. For example, if a person is self employed they will be required to provide a current year to date P&L. Bank statements and Payroll records must be current(past 60 days). Oftentimes the banks won’t review a file without current information even though they are only reviewing the file 90 days after it is submitted. Customers should continue to submit bank and payroll records to the bank until the application process is complete. The banks will not remind clients or call them to let them know their applications are incomplete or their information is outdated.
2. Parts of the file is lost by the bank or servicer. Banks and servicers are receiving thousands of applications per day(most by fax). When submitting an application to the bank, homeowners should write the loan number on each and every documents, so that the banks can put the documents in the correct file. Servicers have available to attorneys methods of submitting applications through web portals. These are not currently available to homeowners.
3. Homeowners are not using the banks forms. Most banks now have websites with preprinted forms to use for the application. If homeowners use other forms for hardship letters or financial statements, the reviewer may not recognize it as such, and deny the application without review.
4. Homeowners are trying to make themselves look as impoverished as possible to qualify. The goal of a homeowner should be to explain to the bank why they can not make the current payment. If the homeowner exaggerates expenses or underreports income, he or she may make themselves ineligible for a modification, when they might otherwise be eligible.
5. Homeowners are giving up. The banks are expanding their programs weekly. Even if a home owner was denied an application last year or even last month, they may be eligible for a program now. It doesn’t hurt to resubmit an application with updated information.
Please call or email me with any questions.

Re: Loan Modifications on Your Own

mybizna — Mon, 27 Jul 2009 04:08:22 -0000

There are really some good Loan Modification companies out there who will do all of this work for you. I mean cmon, the average homeowner like me in dire straits is not thinking about doing all of these things nor do they have the time to sit down and tackle this only to make the mistakes and fail;but would rather someone who is an expert take care of it. Let's be honest, it's in no way an easy process for me and I consider myself to be pretty intelligent. The company I'm working with charges a fee($2095 or $1795 if just behind but not in foreclosure) with a 100% guarantee in writing covering 47 states and they're getting me caught up(5 months behind and in foreclosure), stopping the threat of foreclosure, reducing my rate by 4.75%, saving over $400 each month, and reducing my loan balance. This is a no brainer and I was also referred to them by my neighbor who already went thru the process successfully saving her home and over $7000 per year on her home loan...I was referred to and currently working with a real nice intelligent guy @ a mortgage company...John Williams, 1-866-846-3355ext.109...see what he can do for you I am telling you he is 1 of the guys who is making the difference for us homeowners right now.

Re: Loan Modifications on Your Own

morganb — Sat, 21 Feb 2009 19:04:56 -0000

Notice to all commenters: if you're commenting and pimping the loan modification company you work for or your own personal services your link will be removed as spam. if you feel your comment was removed in error please email me and i'll reconsider.

Re: Loan Modifications on Your Own

Loan Modification Advice — Thu, 19 Feb 2009 21:35:40 -0000

Some good information here. DIY Loan Mods are pretty risky if you don't know what you are doing as sometimes approaching the lender can lead the consumer to be immediately pushed into foreclosure because the lender of the mortgage servicer gets worried about being paid.

A great service that shows homeowners whether or not they are likely to qualify for Loan Modification is called Loan Amnesty

Re: Loan Modifications on Your Own

doc — Tue, 17 Feb 2009 17:14:18 -0000

you r wrong, someones house deserves professional attention (provided its legit) if you go in armed with only a limited knowledge of the process you wont recieve the biggest reduction and best outcome. i can tell you what the lender will reduce your payments to because of the previous experience, knowing lender oblogations, laws, etc. lenders are hoping homeowners don't use professionals. dah

Re: Loan Modifications on Your Own

KurtEse — Sun, 15 Feb 2009 22:03:06 -0000

That was the case in the past, since the Mortgage Debt Relief Act went into effect in 2007, lenders are NOT issuing 1099s for forgiven debt. More can be read at http://www.irs.gov/individuals/article/0,,id=17...

Re: Loan Modifications on Your Own

KurtEse — Sun, 15 Feb 2009 21:57:43 -0000

This was the case in the past. Now, since the Mortgage Debt Relief Act of 2007 was this is not the case. More can be read at http://www.irs.gov/individuals/article/0,,id=17...

Re: Loan Modifications on Your Own

morganb — Sat, 14 Feb 2009 19:48:13 -0000

I think "may" is the operative word here. Many banks are not filing these
1099s. I would also anticipate that there will be some tax law changes with
any mortgage bailout that would relieve this burden. Not that you should
do anything based on what may happen but it is a consideration. Also, you
should always consult a tax professional (lawyer, accountant, etc.) for any
implications on your taxes.

Re: Loan Modifications on Your Own

Avramski — Sat, 14 Feb 2009 19:45:56 -0000

I would add that if the bank does not come after you for the deficiency, it may send you IRS form 1099 for the amount. This means that the IRS will treat the forgiven deficiency as self employed income to you and you will have to pay taxes on it.

Re: Loan Modifications on Your Own

Teri — Sat, 14 Feb 2009 13:50:24 -0000

Arthur, an attorney based loan modification company can collect fees even when the borrower has received notice of default.. sorry for your friend tho'

Re: Loan Modifications on Your Own

Arthur — Thu, 12 Feb 2009 12:01:58 -0000

Never use a loan modification company. They do something you can do yourself veronica which is send information to the bank, cross their fingers and hope for the best. Don't give Phil your information.

Re: Loan Modifications on Your Own

Arthur — Thu, 12 Feb 2009 12:00:59 -0000

You guys don't have a money back guarantee

Re: Loan Modifications on Your Own

Arthur — Thu, 12 Feb 2009 12:00:02 -0000

Don't email this person. My friend went through this company and they lost their home. Their fees are high and they accept money if you are in default which is illegal.

Re: Loan Modifications on Your Own

Gilbert — Thu, 12 Feb 2009 11:54:26 -0000

We should also ask if the company works with the Hope Now Government programs. Those should be the first option for everybody. The program are very generous and are the only way that many people have to save their homes. The hope for homeowners gives a new loan based on the "current" value of the house... In HopeNowMortgages.com said that the government expect to help 400,000 homeowners and they are just starting...

Re: Loan Modifications on Your Own

morganb — Tue, 10 Feb 2009 19:58:26 -0000

I didn't recommend that you contact a loan modification company. I
recommended that you get the info you need to do it yourself. I think that
the company recommended has good information. That's all.

Re: Loan Modifications on Your Own

Bobby — Tue, 10 Feb 2009 19:54:37 -0000

Okay so you explain how to do a modification by yourself. Then you tell everyone to contact a modification company? Don't you think this is a little contradictory?

Re: Loan Modifications on Your Own

morganb — Tue, 03 Feb 2009 18:12:39 -0000

Hi Carelia,

You might want to fill out the form at the bottom of this post (above the comments) and someone from the Mortgage Modification Legal Network will contact you directly about your options. There's no obligation and they'll tell you whether they can help you or not on the first call. (Disclosure: If you work with them I will make a commission as I'm an affiliate.)

Good luck!

Re: Loan Modifications on Your Own

Carelia castro — Tue, 03 Feb 2009 17:00:47 -0000

I would love to do my loan modification on my own, but banks are not interested in helping individuals. I tried getting help from my previous bank and after many phone calls and a lot of paper work, I got no results. I ended up refinancing with another bank just to cash out in order to pay the mortgage and get a fix interest rate. Now we are struggling to make the new payment and our savings are gone. I have good credit, have always paid on time and still I can't seem to get help. I called my new mortgage company for help and their advice was to keep the little money I had left in the bank and not pay the mortgage payment. And that someone would call me within 30 days. Can someone give me some advice.

Re: Loan Modifications on Your Own

tmcfarlin — Fri, 30 Jan 2009 10:13:01 -0000

The idea of a DIY loan modification sounds good in theory, but the reality is most borrowers simply are not able to make the time commitment to the process to get the best result. A loan modification requires a substantial time commitment to be able to wait on hold for hours at a time, and be available to take a lenders call anytime during the day. A borrower should also try and understand the whole process before they start including lender guidelines, programs their particular lender has available, and documents required by the lender. It's not that a borrower can't do it themselves, it just takes an enormous time and resource commitment to do it right.
As far as loan modification companies that offer a "guarantee," the problem with that is they just won't be around when it's time to give the money back...a guarantee is only as good as the company that issued it. Most of these outfits don't last long. In the spirit of full disclosure, I am a real estate attorney and manage www.mcfarlinlaw.com.

Re: Loan Modifications on Your Own

Brian — Sat, 24 Jan 2009 08:18:59 -0000

You will have to be the one who makes the decision to walk away, and that is an option worth considering. Depending on what state you live in and the local economy, the housing values could take YEARS to rebound and return back to a level where you are no longer underwater.

I would be considering these factors:
-your new monthly payment vs. cost of renting
-how long is the foreclosure process in your state (in Michigan there is a 6 month redemption period, so the entire process can take almost a year to get you out of the house if you stop making payments) This allows you to save money while living in the home making no payments
-how long will it take you to rebuild your credit
-the bank may still come after you for the deficiency, because you signed a note when you bought the house which does not go away unless you declare bankruptcy (many times banks will not bother chasing you down for the deficiency because they know you can declare bankruptcy)
-it might be worth it writing them a letter stating that you are not interested in the loan mod unless the balance is reduced to market level (and you would not want to be making payments to them during this time, as they won't take you seriously if the money is still coming in)

Good luck....

Re: Loan Modifications on Your Own

Greg — Fri, 23 Jan 2009 17:06:44 -0000

my loan co. offered a loan mod of 6.5 fixed for 30yrs. but will not reduce princ. to current value..underwater 50,000 ..deal or no deal? will it ever come back you think? 50,000..thanks ...also a balloon payment is in there that can't be modified..maybe I should walk away?

Re: Loan Modifications on Your Own

Brian — Mon, 19 Jan 2009 16:53:16 -0000

I just received information from a law firm that represents Loan Modification and I was blown away by their initiation costs. What should a reasonable fee be to start the process? Then it also states should any additional cost arise they would inform me before agreeing to these fees. However without any idea of what additional cost could be I am afraid that I could have to back out of the agreement with the lawyer because I couldn't afford these additional fees. Can anyone give me an idea of the total cost to do a loan modification through a lawyer cost?

Re: Loan Modifications on Your Own

Bond — Fri, 16 Jan 2009 15:09:59 -0000

As a former Mortgage Brokerage Owner, I decided to work for a Law Firm that is reputable and has been doing Loan Mods long before it became popular.
Fact: The Loss Mit Dept inside Lenders & Servicers say that if a H/O chooses to "Do it themselves" they will get a 100 - 200 dollar break, if they go through an attorney the H/O has more leverage and usually gets what they need, so there you have it right out of the horses mouth. Having the right legal representation so that a H/O can maximize their chances of correcting their current scenario and send them off on a more stable path is our goal and we are accomplishing that 1000's of times over at this firm. I know that there are a large number of scammers out there but a H/O dealing with their own Mortgage Company is like sending a lamb to slaughter..........Bond

Re: Loan Modifications on Your Own

Veronica — Tue, 13 Jan 2009 23:11:13 -0000

Hi Phil, I've tried to send you an e-mail, but I keep geting that the e-mail address is incorect or can't be found.
Thank you

Re: Loan Modifications on Your Own

Loan_Modification — Sat, 10 Jan 2009 16:29:21 -0000

Indeed a valuable information on the subject but can you think of someone handling all legal aspects of the loan modification process ?