Mortgage modification questions/National programs

[meanwhile]

Has anyone had experience with a mortgage modification for a small homestead? Or Farm? We have a small place. 20 Acres and the house and barn. My husband is not well and just had to retire and close up his business. My income is not enough to cover all the bills (I had lost my job but we were able to shuffle some things so I am getting a pay check now).

A family friend works for a Homeownership Resource Center, they help with mortgage modifications and also with a government program to help reduce mortgages and help people stay in their homes. There is another program with NC called a "hardest hit" area program.

Has anyone tried these programs? Good? Bad experience? Things to be careful about? The person we talked with made it sound like a very good program - almost too good to be true. They said we can get the mortgage reduced, a lower interest rate and keep the low rate for five years.

Any tips? Suggestions? Warnings?

Thank you very much.

[jlrbhjmnc]

So sorry to hear of your trouble .

Dave Ramsey has repeatedly reported that 97 or 98 percent of the attempts to do one of these modifications fails. If it sounds too good to be true then it is too good to be true.

If I found myself in a position where I could not maintain the payment, I would sell - keep your fate in your own hands.

Could you sell some of the acreage and keep the house and barn? Or do you need to downsize? (Not looking for answers from you, just trying to offer some thoughts to stimulate your thinking about your options.)

[meanwhile]

We want to be able to keep the whole place intact. For us, it would make no sense to stay if we give up part of the land. I will go take a look at the Dave Ramsey site and read there. Thank you for the tip.

[Shadow]

It sounds too good to be true is the tip off. They will lower your interest rate for five years cut your payment for five years add years to the morgage and then after five years the interest rate skyrockets to God knows what. I'm sorry for your problems but most likely your best bet is sell and downsize. You just no longer can afford the life style, that is the problem most people would have if their job or life changed, they would have to down size finances and life. The programs are a joke. IF THEY ASK FOR MONEY UP FRONT RUN, RUN FAST, RUN FAR.

[Ifistav]

I would talk to the bank directly. I have heard of loan modifications, but I've never had to do that, but I heard that you can go to the bank and discuss it with them.

I think with the new "twist" package that the Fed announced yesterday, you should be able to get something done.

Best of luck.

Ifi

[Sawmill Jim]

Originally Posted by Ifistav

I would talk to the bank directly. I have heard of loan modifications, but I've never had to do that, but I heard that you can go to the bank and discuss it with them.

I think with the new "twist" package that the Fed announced yesterday, you should be able to get something done.

Best of luck.

Ifi

Yea they will twist your arm off and beat you over the head with it
Read the small print twice .

[elkhound]

talk with bank...what are you paying in interest rate as on now? you can do what is called a rate modification.when you do this you dont have to have a lawyer,inspections etc like if you refinace and pay closeing costs.all you pay if they reduce interest is somethign like doing "points" when you take out a loan.they usually will ask you if you want to change amount in payments monthly or keep same and take the amount off the length of it.

a rate modification should only take about an hour to do in the bank.hope this helps.

[oregon woodsmok]

Call your bank and ask about a refinance. Interest rates are really low and if you can get a lower interest rate, it will lower your payments. Chase, where I have my mortgage, will refinance one of their existing loans and not do an appraisal or re-qualify you as long as your credit is good.

I don't know if any other bank will do that. It's worth asking them.

I've heard some real horror stories about the loan modification program. I'd be afraid to try it.

I'm going to second the opinion that if you can't afford to stay in your place, it is time to sell. Save your good credit rating and then as soon as things get better, you can be qualified to buy again.

[oz in SC V2.0]

We didn't have a very good experience with trying to modify our loan,of course this was back a couple of years.

Went round and around,all the while they told us to keep paying,keep current on our payments...then told us because we weren't behind they couldn't help...okay...new program was coming along they told us,THAT would help us out.

Kept paying(anyone getting the picture here??),they finally sent out a package,no reduction in interest,no change in length of loan(this was actually the problem we had,being the self sacrificing types,we took on a short term loan(5 years) in order to pay down what we owed quickly and get out of debt.),what they did was drop the payment less than $100/month.

Hopefully your situation will be better.

[meanwhile]

Thank you everyone - it is not sounding good. Anyone else? Anyone have good experience with them?

[Linda J]

We tried to get a loan modification with our bank since December, because of a change in my husband's pay. First we were denied, made too much money. Ha! We reapplied, the bank kept losing paperwork, or saying just need one more thing. Then we fell behind on our payments, almost went into foreclosure, cashed in some of the 401k to pay the reinstatement fees. Our payments jumped $800.00 per month more for a year to pay the remaining fees.

We contacted HopeNow, a nonprofit. The person we spoke to evaluated our situation, and tried to call the bank loss mitigation dept while we were on the phone with her. Of course, they didn't answer. She mailed the bank our information, told them that since the loan was a government loan, if we didn't qualify for the Making Home Affordable program we would qualify for something. This was 2 weeks ago. THEN, Tuesday we got a call from the bank saying that they approved our loan modification. I didn't believe them, but they are mailing the paperwork.

Deal with the bank directly. Don't pay anyone to do this for you. Don't stop making your house payments, foreclosures move quickly and the bank will have one department foreclosing and the other is working on the modification. Make copies of everything they ask you to send to them. Be ready to fax what they need right away. Contact them every 10 days to see how it's going. Contact HopeNow to be advocates for you. HopeNow tells you right up front if you qualify. Don't let the bank steal your house. Fix it up, and be ready to sell if you have to. The loan modification process makes you old, and keeps a person up at night. It took us almost 9 months.

[ChristieAcres]

I know of a few people who got modifications dropping their payments in HALF. However, they did those mods directly with their mtg companies, not with other companies charging fees to intercede/negotiate on their behalf. Yes, it takes patience and you need to document absolutely everything, make copies, keep receipts when you fax or send via certified mail anything. Yes, ditto on constant contact!

[oz in SC V2.0]

I don't know about banks moving quickly on foreclosures..we still hadn't received a notification from the bank that they were planning to move forward,and we had been there over two years since the BK....

But I do agree that one department will have no earthly idea what another department is doing,or even know what is going on within their own department.

One thing is this,it can't HURT to try and getting a modification.

[TNHermit]

I'm in the final staes of a three year war which involved a mod. Paid on it for 7 months after they told me it would be good in 3-4 good faith pmts. i finally quit.

I do know on occasion that people have got them. Nothing wrong with trying. Like Loris said I would do NO verbal communication. I have a file over two inches thick right now.

You can check over at Loansafe.org for some info. It may be better if you don't have a BIG bank.

[Linda J]

Oz, I think it depends on the bank and location as far as speediness of foreclosures. We were told by the bank's attorney our house was being sold the following month. It seems like down in Austin, things move pretty quickly. Property is still selling, not like hot cakes, but still selling. There's a bunch of Chinese snapping up properties that are at auction. We are on the top of a hill with a great view, in a house on 8 acres. Not a big house, just a small 3 bedroom. There's rumors that there's a golf course going in behind us.

Your bank may have just walked away from the house.

[sammyd]

I lost my job 18 months ago. Luckily I have been able to keep up with the payments.
But since I have, the bank laughs at me when I try to talk with them about some help.
I would rather have had my savings last longer with a better rate on the mortgage but they would rather that I run out of money and be late on my payments before they do anything.
I have heard of some other programs out there but I have found no real life programs that can help.

[meanwhile]

Thank you everyone -

We are not behind yet but I anticipate problems since our income is slashed. The group that has offered to help does not take a fee but there is some talk of "after five hours" of work, maybe there is a fee? I am checking on that now.

I have not contacted the Bank directly yet since some people have said it will be faster with a group handling it. Apparently the Banks are being told they have to try and resolves mortgage problems and according to the woman I spoke with, they are approving 80+ % of the requests now? I hope that is true.

Thank you so much for the information and tips.

[TNHermit]

Originally Posted by meanwhile

Thank you everyone -

We are not behind yet but I anticipate problems since our income is slashed. The group that has offered to help does not take a fee but there is some talk of "after five hours" of work, maybe there is a fee? I am checking on that now.

I have not contacted the Bank directly yet since some people have said it will be faster with a group handling it. Apparently the Banks are being told they have to try and resolves mortgage problems and according to the woman I spoke with, they are approving 80+ % of the requests now? I hope that is true.

Thank you so much for the information and tips.

I ploy the banks may try to suck you into is that they can't do a modification unless your two months behind. So people don't pay for two months and then it screws up the whole loan. and the banks then say GEE were sorry but you don't qualify. but you can pay theses fees for not paying the last two months.

If they are not and old time local unaffiliated bank. Then they are crooked, Count on it

[Energy Rebel]

Originally Posted by jlrbhjmnc

Dave Ramsey has repeatedly reported that 97 or 98 percent of the attempts to do one of these modifications fails.

I knew the percentage of people doing this had to be low, but it's scary to think it's that low.
Fortunately, I've always been a "1 percenter".
Frankly, most people don't have the patience or guts to get this done.
Not a criticism, just a warning as to how hard this actually is to do.

Originally Posted by Linda J

We tried to get a loan modification with our bank since December, because of a change in my husband's pay. First we were denied, made too much money. Ha! We reapplied, the bank kept losing paperwork, or saying just need one more thing. Then we fell behind on our payments, almost went into foreclosure, cashed in some of the 401k to pay the reinstatement fees. Our payments jumped $800.00 per month more for a year to pay the remaining fees.

We contacted HopeNow, a nonprofit. The person we spoke to evaluated our situation, and tried to call the bank loss mitigation dept while we were on the phone with her. Of course, they didn't answer. She mailed the bank our information, told them that since the loan was a government loan, if we didn't qualify for the Making Home Affordable program we would qualify for something. This was 2 weeks ago. THEN, Tuesday we got a call from the bank saying that they approved our loan modification. I didn't believe them, but they are mailing the paperwork.

Deal with the bank directly. Don't pay anyone to do this for you. Don't stop making your house payments, foreclosures move quickly and the bank will have one department foreclosing and the other is working on the modification. Make copies of everything they ask you to send to them. Be ready to fax what they need right away. Contact them every 10 days to see how it's going. Contact HopeNow to be advocates for you. HopeNow tells you right up front if you qualify. Don't let the bank steal your house. Fix it up, and be ready to sell if you have to. The loan modification process makes you old, and keeps a person up at night. It took us almost 9 months.

This is typical.
Follow the advice in bold.

And this advice as well.
vvvvvvvvvvvvvvvvvvvv

Originally Posted by lorichristie

I know of a few people who got modifications dropping their payments in HALF. However, they did those mods directly with their mtg companies, not with other companies charging fees to intercede/negotiate on their behalf. Yes, it takes patience and you need to document absolutely everything, make copies, keep receipts when you fax or send via certified mail anything. Yes, ditto on constant contact!

This was my situation.
At the point I ran out of 401K and savings, I ran out of patience as well.
vvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvv

Originally Posted by sammyd

I lost my job 18 months ago. Luckily I have been able to keep up with the payments.
But since I have, the bank laughs at me when I try to talk with them about some help.
I would rather have had my savings last longer with a better rate on the mortgage but they would rather that I run out of money and be late on my payments before they do anything.
I have heard of some other programs out there but I have found no real life programs that can help.

Here is what I did.
Remember the percentage at the top of post.


Vikram Pandit is the CEO of the entire Citibank conglomerate.
Citigruop. Citifinance, Citimrtgage, Citibank.

Find the name and hopefully address of your bank's CEO.
I narrowed down Pandit's to a few ciy blocks in NYC and had the name of a restaurant he was seen in ordering a $400 glass of wine.

I wrote a letter which my wife was afraid to type up and send. She thought I would get a visit from law enforcement instead.
I said do it anyway.
The gist of the letter, sent by certified mail, was that I knew where he lived, knew the location of the next shareholders meeting (NYC) and would be willing to buy one share of stock and show up in person.
I was not going to play the game set up by the gov't and banks, because if you follow the rules, you lose.
Refinance me or else, that's the only deal on the table.

Within 6 weeks the deal was signed, sealed and delivered.
Lower interest resulting in a 1/3 reduction in monthly payment, same 30 year term as before.

The CEO's office even called to ask what was taking me so long to get the paperwork back to them, LOL.

Now, most would not have the stomach for this and my sanity was questioned more than once from everyone I know.
But the results were undeniable.

Bottom line - deal directly with the highest authority you can find in your financial institution, and no one else.
If you play by their rules - you lose.

[Sawmill Jim]

Energy Rebel
Yep i agree had the same thing happen with an insurance adjuster once
He saw things my way too