Attempting a Loan Modification? Get Ready For A Lot Of Frustration

© Reidos – Fotolia.com

You are not alone if you’re frustrated in doing a loan modification. Thousands who want to stay in their home are hoping a loan modification will help. The Federal Housing Finance Agency says that as of November 30, 2009, a total of  405,700 trial and permanent modifications had been accomplished using the government’s Home Affordable Modification Program called HAMP. The largest part of that number are actually trials and not permanent modifications. Attempting a loan modification is like running a marathon without a map of the race course, the largest hurdle being the incompetency of the lenders, with some banks much worse than others, but ALL needing some improvement.

The mounds of paperwork the homeowner needs to submit to their lender is the same as what they would have to submit for a short sale.  On a short sale, however, the homeowner has the aid of a Realtor, an attorney, or a loss mitigation company working for them by gathering the required papers, organizing the application, and submitting it for them.   On the loan modification, they’re on their own unless they want to pay a fee for an attorney or loan modification company to do it for them.   Then they have to beware of companies who seem reputable and claim to want to help, but  give poor service and very little results for the money they require upfront. Some of these companies actually take the money and do nothing, preying on the fear of the scared homeowner.

We’ve talked to many homeowners who have submitted their lender’s required documentation, then received a call from their lender saying they are in default because they have not received anything from the homeowner.  Many times the homeowner receives an identical loan modification package requesting the same information they just sent their lender.  When they call their lender, they’re shifted from one person to another, none of which know their keyboard from a coaster.  One lender said, “The reason the information is not in our database, is that it was entered into Vault A.”  When asked what Vault A was, the processor had no answer to that.

Another homeowner, after making 6 required trial payments on time, received a daily call Christmas week including Saturday and the week thereafter, to tell her that her file was complete and perfect.  Each call was from a person whose dialect was difficult to understand , and when the homeowner asked the purpose of the call, she was told that the computer picked out homeowners at random and her name came up.  Calling every day for two weeks with the exception of Christmas and New Year’s Day didn’t seem like random calls.   The caller could not answer questions about the loan modification, as it was not in their computer for them to view and none of the callers had any idea of when, or if the loan modification was with a negotiator or person in a decision-making capacity. What was the purpose of all these calls? None of them accomplished anything and left the homeowner more confused than she already had been

Most homeowners attempting a loan modification feel as if they are in limbo, or some sort of bureaucratic purgatory.  To add insult to injury, their trial payments go into a special account and they are reported to the credit agencies as being late.  Very few of the people I have talked to were ever told  their credit was being damaged by the process.  Some homeowners have even reported that their lender failed to pay the homeowners insurance with the monies in already in escrow accounts, because the insurance renewal came up during the trial period.

There are some satisfied homeowners who have been successful in obtaining a loan modification but, in general, the system is broke. The government has been focused on health care (we won’t go there), and although we don’t want over-regulation of the lenders, there needs to be a better way.  There are some smart minds out there, but who’s out there to listen and put those solutions into place for the homeowner in danger of being pushed into a short sale, or if that should fail, a foreclosure, deed in lieu, or even a bankruptcy?

Similar Info:

1. Obtaining a CDPE Designation – Certified Distressed Property Expert Having successfully done short sales for...
2. Do You Have A Bank of America Mortgage On Your Port St. Lucie, Jensen Beach, or Stuart Home? If you bought a home in...
3. Some Banks Reaching Out To Home Owners in Port St. Lucie There are a couple of banks...
4. HAMP Modifications And Unforeseen Complications – HAMP Is Not Working I wrote a post a while...
5. A Short Sale Thank You One of the great things about...

« Where Is My First Time Homebuyer $8,000 Tax Credit? | Home | First Time & Existing Home Buyer Tax Credit Ending Soon »

• Quick MLS Search

  Max Price:

  Min Price:

  Min SQFT:

  Min Rooms:

  Min Baths:

  Choose a City

  Port Saint Lucie Hobe Sound Hutchinson Island Indiantown Jensen Beach Juno Beach Jupiter Jupiter Inlet Colony Lakewood Park Lighthouse Point Loxahatchee Melbourne North Palm Beach Other Palm Beach Palm Beach Gardens Palm Beach Shores Palm City Fort Pierce Port Salerno Royal Palm Beach Saint Lucie West Sewalls Point Stuart Tequesta West Palm Beach

• Testimonials

  Dear Marlene,
  Dear Dale and Brad

  When I traveled to Florida in September 2009, I knew that I wanted to buy a house. How such a buy takes place in the U.S., I could only guess at the basis of reports on the Internet.

  When I arrived in your office in Port St. Lucie, everything was already prepared well. You have created a selection of houses, which corresponded to my criteria regarding size, location, condition and price.

  During the visits of the various houses, Brad gave always important additional information for example about the neighborhood, the builder and the quality of the construction. The fact that your company has built houses for many years, was there a big advantage.

  I have finally found my dream home at a truly affordable price. The purchase and closing itself was, thanks to your personal network your have built up within the past 37 years in business, very smooth and easy.

  After the buy, you have advised and actively supported me in the selection of the home owner insurance and many other details, such as signing up for electricity, water and sewer etc.

  In retrospect, I can say that the purchase of my vacation home in Florida could be handled much easier than I had imagined. The purchase of a property in Europe is so much more complicated than it is possible in Florida.

  I am very happy with my house in Florida and your team has made a significant contribution on that, for which I again thank you very much! It was the right choice to work with Century21 Colean Realty Inc. .

  Kind regards

  Marco Sturm
  Switzerland

  Geschätzte Marlene,
  Geschätzter Dale und Brad

  Als ich im September 2009 nach Florida gereist bin, wusste ich, dass ich ein Ferienhaus kaufen will. Wie ein solcher Kauf in den USA abläuft, konnte ich anhand Berichten im Internet nur erahnen.

  Als ich in eurem Office in Port St. Lucie eingetroffen bin, war alles bereits vorbereitet. Ihr habt eine Selektion von Häusern erstellt, welche meinen Kriterien bezüglich Grösse, Lage, Zustand und Preis entsprachen.

  Während der Besichtigung der verschiedenen Häuser hat mir Brad immer wichtige Zusätzliche Informationen, wie zum Beispiel zur Nachbarschaft, dem Erbauer sowie zur Qualität der Bausubstanz gegeben. Die Tatsache, dass Euer Unternehmen lange selbst Häuser gebaut hat, war dabei ein grosser Vorteil.

  Schliesslich habe ich mein Traumhaus zu einem wirklich günstigen Preis gefunden. Der Kauf selbst konnte dank euren sehr guten Kontakten einfach, rasch und problemlos abgewickelt werden.

  Ihr habt mich auch nach dem Verkauf bei der Auswahl der Versicherung und vielen weiteren Details wie der Anmeldung für Strom, Wasser und Abwasser etc. beraten und tatkräftig unterstützt.

  Rückblickend kann ich sagen, dass der Kauf meines Ferienhauses in Florida viel einfacher abgewickelt werden konnte, als ich mir das vorgestellt habe. Der Kauf einer Immobilie in Europa ist so viel komplizierter, als dies in Florida möglich ist.

  Ich bin mit meinem Haus in Florida sehr glücklich. Dazu hat Euer Team einen entscheidenden Beitrag geleistet, wofür ich mich nochmals ganz herzlich bedanke! Mit Century21 Colean Realty Inc. habe ich die richtige Wahl getroffen.

  Herzliche Grüsse

  Marco Sturm
  Schweiz

  
  — Marco Sturm, Switzerland

• Affordability Calculator

  Monthly Gross Income	$
  Monthly Debt Expenses [?] Monthly Debt and Obligations Should Include: Monthly Credit Card Payments Monthly Auto Payments Monthly Child Support Monthly Association Fees Other Monthly Obligations, but NOT utility bills.	$
  Down Payment:	$
  Interest Rate:	%

• Translate this blog into……

  Albanian Arabic Bulgarian Catalan Chinese Simplified Chinese Traditional Croatian Czech Danish Dutch Estonian Filipino Finnish French Galician German Greek Hebrew Hindi Hungarian Indonesian Italian Japanese Korean Lativian Lithuanian Maltese Norwegian Polish Portuguese Romanian Russian Serbian Slovak Slovenian Spanish Swedish Thai Turkish Ukrainian Vietnamese

• Calendar

  August 2010

  M	T	W	T	F	S	S
  « Jul
  						1
  2	3	4	5	6	7	8
  9	10	11	12	13	14	15
  16	17	18	19	20	21	22
  23	24	25	26	27	28	29
  30	31