Notice of Default, Foreclosures, and Loan Mod Progress.

I always read on a daily basis about Loan Modifications, Short Sales, Foreclosures, and the like. I read alot of information and from what I am seeing, as general consensus, Lenders have been helping alot of people with whatever mortgage relief that is deemed necessary by the lender. According to what http://www.dsnews.com says, in the month of May, there were 63,000 permanent solutions for homeowners in default. Of that 63,000, there were 17,590 of those homeowners that were made complete by President Obama's HAMP program. By all means, these numbers are great. When Wells Fargo accounts for 11,000 of those modifications  alone, it seems to be looking up for the homeowner. My problem with this is that I speak to alot of people throughout the day,  and I am wondering why the majority of these people have not been helped. see the majority of my clients, or potential clients have been trying to get loan modifications, even for the trial period for 7-12 months. Those that are longer than that have flat out been denied and the lender is speaking of private investors not willing to budge. In some cases this may be true, but I will bet my last dollar that 90% of those cases are not. See the problem is very simple. People need help. Homeowners are defaulting on loans that they couldn't afford in the first place and they become complacent once they hit a certain time frame that they have defaulted and the bank as not acted. There is approximately 2.53 million homeowners in default currently and that has been close to the same number  since 2009. So while the lenders are supposedly "helping", there are just as many people that are looking for answers at the same time.  Foreclosures are still up. According to HOPE NOW, there was a rise in forecloses from the month of April (60,000) to May (65,000). what this tells me, is that lenders are willing to put more people on the street than they are looking to help. I say this ignorant to the individual situations, however I speak with or meet hundreds of people a day that are in dire straits and need help so I think that I can speak for the majority of folks when I say that it isn't enough.

Bi- Partisan settlement that has come into play leaves the Big 5 having to give out 125 Billion in relief in a matter of 3 years. This is a large amount of relief. My issue with this is that the big 5 are going to hold out as long as they can to offer this assistance and the foreclosure rate is going to continue to go up unless the state officials do what California did and make it a law that lenders may not foreclose while in some sort of relief program. This is a great law for those that will be approved for the relief program, but what about the ones that are "not qualified", I see these lenders denying any relief after going through the motions, and escalating foreclosure. Believe you me, these machines are debt collectors and I think we homeowners are thinking incorrectly if we think that they are out for our best interest. they may offer some form of relief to some of us in this 3 years, but it is going to be on their terms, which can increase your payments, balloon the payments for any relief that they are putting on paper and still put you in a bind, and ultimately line their pockets with money of the struggling. Look at it this way, marketwatch.com expresses that 56% of people that get their loan modified permanently, a going back into default in an 8 month time period.

I know that this is a personal rant of mine and i apologize if you feel it too "opinionated". However I am writing on behalf of the clients that I deal with on a daily basis and offering this opinion based on what I have to do to keep people in their homes on terms that are beneficial to them and not the lender.

Please comment or email me if you have questions, or concerns.

HAMP Program: Let me get this straight...

I have noticed here lately that when I am speaking to potential clients for loan modifications, that they have been having difficulties with their eligibility for the HAMP Program. In these particular situations, I don’t know if the client is misunderstanding or in their lender is just being facetious. They are being told that do not qualify to receive a mortgage rate reduction because they are paying more than 31% of their monthly income towards their mortgage. Or that they don't qualify because they are behind If your lender is telling you this, you need to straighten them out.

 According to http://www.makinghomeaffordable.gov/programs/lower-payments/Pages/hamp.aspx, you are eligible for the HAMP Program if you are paying more that 31%. This being from the actual site, I tend to believe that a little more than someone representing the lender that just happened to get a job in customer service.

There are several different facets that Making Homes Affordable has in place. There is not only the reduced interest, but there is Principal Reduction Alternative.

 

 Your mortgage cannot  be owned or guaranteed by Fannie Mae or Freddie Mac.You must owe more than your home is worth.You  have to occupy the house as your primary residence. If you obtained your mortgage on or before January 1, 2009, and your mortgage payment is more than 31 % of your gross monthly income. You must owe up to $729,750 on your 1st mortgage, and have a financial hardship that has lead you to be either delinquent or in danger of falling behind.You have to have sufficient, documented income to support the modified payment, you must not have been convicted within the last 10 years of felony larceny, theft, fraud or forgery, money laundering or tax evasion, in connection with a mortgage or real estate transaction.--- http://www.makinghomeaffordable.gov/programs/lower-payments/Pages/pra.aspx



There is also Home Affordable Unemployment Program. You may be eligible if:

You are unemployed and eligible for unemployment benefits.You have to occupy the house as your primary residence.You have not previously received a HAMP  modification, and you obtained your mortgage on or before January 1, 2009.You have to owe up to $729,750 on your home.-- http://www.makinghomeaffordable.gov/programs/unemployed-

Keep in mind however that you may be required to make a partial payment not exceeding 31%.  I don’t know if those partial payments will actually be going to the mortgage or not, you may want to check your statements to see if it reflects that. Find out if it is going into an escrow account; just make sure that you know where your money is going. This program is NOT available if your mortgage is held by Fannie Mae or Freddie Mac, so if yours Is, you will need to contact them about the forbearance programs they have available.

Furthermore, if you are behind, that means that you have hit a hardship and were unable or are unable to afford your payments. That is the reason why you need a modification. No need to go too deep on that one. You should just talk to them like they are idiots if they tell you that you don't qualify because you are behind.

At the end of the day you just have to know what and who you are dealing with. You CAN do this by yourself but your lender may be telling you that it is unable to be done. If you are having problems, you may need to get in contact with someone that has the know how to deal with the lender. If you fall under these criteria listed above, you shouldn’t have a problem obtain a HAMP modification. Remember, modifications are about numbers and ratios. If you can prove hardship you are eligible.

Let me know if you have any questions or concerns or if you just want to talk about it. 

Mortgage Reduction: Real or Fake?

 When I am speaking to potential clients, one of the biggest questions that I get is “how do I know that you aren’t just a scam artist?”  As a person that genuinely likes to help people I feel the need to separate myself from the “law groups” or the “specialists”. Forgive me if I am adding a personal tone to this post, as this is my business, therefore my lively hood, I take this personally.

Signs of a Loan Modification Scam:

1.       Guarantees- No one can guarantee anything. It does not matter what the situation holds, your lender can do whatever they want. Many of these companies call you to sell you a dream. Don’t deal with these kinds of companies.
2.  Upfront Fees-No company is allowed to charge an fee up front for a loan modification. Period. The Federal Trade Commission http://www.ftc.gov/opa/2010/11/mortgage.shtm posts that it has been cracking down on these guys for years. Charging an upfront fee to modify your loan is illegal. They charge outrageous prices from $1500 - $3000 and even break them down to monthly payments. When you see prices like this RUN! Lawyers are calling these retainer fees, but at the end of the day, you still wait an average of 6-8 months and the bank can still deny you. Then what do you do? You have just lost a significant amount of money and the lawyer is going to suggest bankruptcy in which they will receive another payment from you. Even wen companies charge you after the work is done, you can expect words like percentage, which is probably going to wind up being more money  than what you are prepared to pay. 
   *note* if you are purchasing an actual product that you can use, it is legal, and the company  must give you term of an agreement and have you sign off that you know that you are purchasing a product and not a service.
3. Trade Secrets- there are no trade secrets. If a sales person tells you that they are not allowed to give out the trade secrets, hang up, or walk out. Mortgage modifications deal with Debt to Income ratios and you must fall under qualifying guidelines. If they can’t express how they can help you or how their product can help you, they are probably not going to help you.

I personally believe that transparency is the key to any business relationship. If you are speaking with a company, group, or person about helping you with your mortgage crisis, they need to be a wealth of info. If they are unable to answer any questions or they give you a one off answer and get back to what they want to talk about (90% of the time it’s about your payment), you probably need not do business with them.

Trust and comfort are the key words in this kind of relationship. Should you speak with one of these kind of companies and you feel that you need someone to help, make damn sure that they are willing to bend over backwards to not only earn your trust but your money as well. If you ask for an email and they say that they don’t or won’t do that, they don’t want to earn your trust or money. Also ask them how you are protected if they are a scam. A scam artist won’t tell you how to put them in jail.

I know that this is a personal rant, but I deal with this question all of the time so I find it necessary to address the question publically. Let me know what you think.