BofA seems to be turning on the 2mp machine.

[davephx]

BofA seems to be turning on the 2mp machine.

As a few others posted on another thread some of us got BofA 2MP papers this week.

Seems are all following 2MP. No paperwork needed to qualify just send in a Dodd-Frank Law certification that you haven't been convicted of mortgage fraud in the past 10 years.. with Fed Ex envelope to return.

3 Month trial as 2MP requires at 1%/40 years for first 5 years following the HAMP step up afterwards. All correct per 2MP requirements.

2nd went from $540 at 9.1% to about $183 for first 5 years. It does not show the past roll up amount from about 2 years of not paying but should be about about $12,000 and the payment seems about right on about $70,000 (was 60K). The rollup should be only interest not the full payment and no late payments.

Letter says will compute exact amount after trial. My 1st was Citi which was HAMPed then sold to the IBM company.

This is both good and bad news. It is nice to have it settled but the home which I love and hope to never leave is way underwater just on the 1st (Phoenix) so I doubt if they would foreclose on the 2nd even if didn't agree to terms of 2MP. It will take probably longer than my lifetime to have equity but I don't care since again I love it and only care about the payments have to make. The 1% on 2nd and 2% on first for 5 years offsets the under water equity so paying a market rate on far lower equivalent mortgage.

The problem will be in 5-10 years the step rate increases to about 5%, but both will be less than pre modified payments at highest eventual amount.

The last thing I am concerned about is "dead equity" in a home I hope to never leave or sell.

It is a Frank Lloyd Wright like design with a beautiful view of No Phoenix and mountains. Have million+ homes nearby (and across street) but mine is smaller and original cost in peak of market in 2007 of $410k and I had to go above the list price of $395k in a bidding war for it. About 2200 sq feet perfect for single old me and ideal office in home set up, 0.25 acre lot. Zillow value down to about $275k A few years ago lots across the street that are less easy to built because of slope and smaller were on market for $200k because of sweeping views. Two are still not sold and one a builder built a $1m+ home on he lives in across the street from me.

Area not good for pets - a coyote killed the prior owners dog and I hear them whaling at night but so nice and quit otherwise.

[lisascakes]

We have BoA for both first & second - we start our HAMP trial payments 2/1 & just received the financial packet for the second, getting ready to Fed Ex back this morning. Greg from the oop told me that getting a second modified with BoA is almost impossible.

Nice to know he lied to me!!! Congrats on your trial payments!

[lisasxr]

Thanks Dave!!! I really am dreading taking on the 2nd (as we already received a notification that it was ineligible and after the 1st was made permanent we are in a good place). HOWEVER, I may as well stay "in the modification mode" as opposed to trying for it later!

Guess I'll be re-educating myself on what 2MP is all about so I can properly tackle this project. Do I recall correctly that if the 2nd is current I don't have to worry about a trial period?

[lindaneedsalifebutIamold]

Was your 1st with BofA too?

[lisasxr]

My first is serviced by BAC as well as my 2nd. I won't give them any credit to figure it out for themselves that I auto qualify for 2MP!!

[lindaneedsalifebutIamold]

We have BoA for both first & second - we start our HAMP trial payments 2/1 & just received the financial packet for the second, getting ready to Fed Ex back this morning. Greg from the oop told me that getting a second modified with BoA is almost impossible.

Nice to know he lied to me!!! Congrats on your trial payments!

So you got your 2MP as your TP is starting? Wow! I talked to BofA today and the guy told me that the paperwork comes from a 3rd party that the 1st (in my case, WF) would report the HAMP to cross reference for a 2MP. He said that sometimes the people get their paperwork even before BofA is notified. I wonder if that is true if both loans are with BofA?

Sounds like they're finally getting systematic with the 2MP. Thank goodness!

[lindaneedsalifebutIamold]

Thanks Dave!!! I really am dreading taking on the 2nd (as we already received a notification that it was ineligible and after the 1st was made permanent we are in a good place). HOWEVER, I may as well stay "in the modification mode" as opposed to trying for it later!

Guess I'll be re-educating myself on what 2MP is all about so I can properly tackle this project. Do I recall correctly that if the 2nd is current I don't have to worry about a trial period?

Lisa,

Was your 1st modification a HAMP? If so, you should be eligible for 2MP.

[lisascakes]

Linda,

The trial payments on the first are with HAMP. I thought I read that if the first is a HAMP mod that the second was eligible with no problems or more financials. Just to stay on the good side of my OOP neg I sent in the papers for the second. If I have to fight the second after first is complete I will, don't think I can fight both of them at the same time.

[troubleinriverside]

Why on earth would you modify an underwater 2nd ?? wouldent settleing to release the lein be a better strategy ??

[davephx]

I wonder if those of us that got the recent flood of 2MP's are all Countrywide originally (I was) or is it broad-based.

If they are asking for financials it is not for 2MP which is automatic with no paperwork required. Yes even if current I believe you have to do the 3 trials with 2MP. BofA would rather do a less desirable inhouse instead of 2MP. They had tried for over a year to get me to apply for inhouse but have just ignored there calls now for about another year.

Why modify vs settle. That is easy BofA is not doing many good settlements and even at 20% I do not have funds to settle. Usually they want to settle at 50% but don't recall what others have gotten but as I recall not very good - not like 10%.

The bigger question is if so far underwater to do the 2MP or not. But I got the NOD and acceleration notice like 2 years ago and if nasty even if makes no sense have the risk of foreclosure if don't do 2MP or in a few years if equity ever recovers. I am sure if want to refi would never get a better deal that it is under 2MP.

Remember most Banks own their own 2nds not like 1sts. Doing 2MP is by far a less hit to profit that taking settling. So it makes no sense for them to settle vs 2MP. If the 1st in not HAMPed so there is no 2MP available and way underwater than they may be better off doing a settlement.

[troubleinriverside]

got it. sounds like the banks are moving to generate some funds from non performing assets, dead 2nds, and preying on peoples fear of a future foreclosure. I'm going to sit tight, and wait for a settlement offer some day. there are a couple homes for sale like mine down the street, for more than I owe on my 1st. if they sold at that price, my 2nd could possibly use them as comps. One of the for sales was a prior foreclosure, guys been in it about a year. i think Both are unrealistcly priced by $100K or so, but I think some people get desperate to get out and have unrealistic expectations. my zip code has one of the highest foreclosure rates in California

[lindaneedsalifebutIamold]

Linda,

The trial payments on the first are with HAMP. I thought I read that if the first is a HAMP mod that the second was eligible with no problems or more financials. Just to stay on the good side of my OOP neg I sent in the papers for the second. If I have to fight the second after first is complete I will, don't think I can fight both of them at the same time.

Yes, if you get modified under HAMP, then you info is sent to an entity called Lender Processing Services or LPS that cross references your loan looking for a 2nd and then they mirror the 1st and modify under 2MP. That's why I asked if yours was HAMP.

What's amazing about your getting the paperwork for the 2MP is that you still are in a trial period. Moving very fast!

[ginnywilcox]

I am doing the same thing troubleinriverside is. BTW my 1st was HAMP with PNC and I originally had a 2nd with PNC that was bought out by countrywide years ago (and we know the bofa/Countrywide story), so I am wondering if davphx was on to something there...

Anyway, I got the 2MP offer letter a week ago. We finally decided not to pay them in November. So there is a trail payment plan only if you are late, if you are not, it is automatic. I told them to bascially...kiss my bu*** that I am so far underwater the trail mod at 2% interest only for 5 years is nothing. I copied the 2MP extinguishment option and highly recommended they take that offer from the 2MP program because otherwise I will either walk away (strategic default) or wait and settle with collections for 5 to 10%. I have years...probably 8-10 years before our house would have enough equity on the first for the whole foreclosure on the 2nd could even happen.

I also gave them a copy of my current county tax assessment which shows our house is 200K (and falling) underwater...thier loan is 100K. I wonder what is going to happen....not sure why they wouldn't take the 2MP extinguishment option other than "not wanting to negotiate with terrorist" i.e. me refusing to pay another penny to them...BTW the 2MP extinguishment offer goes down in money if they wait longer than 6 months of being late...so they only have a couple of months to make the decision to take the money (either .10 or .15 cents on the dollar....we are on the cusp of 140% underwater so depends on how they calculate our house value) otherwise they only get .6 on the dollar for loans that are 6 months late regardless of the % underwater.

[davephx]

It will be interesting if they will take the 5-15% but I bet not nor extinguishment but hope I am wrong.

The longer they can delay even if your not paying the longer they can wait to take the loss and since they are public that is very important. The accounting rules are somewhat an issue however as I understand it as long as there is a lien they don't have to reduce Tier 1 Capital (or equity) which is the important part of bank capital.

[selphie]

Dave, I don't want to take this off topic, but you mentioned some people have gotten offers to settle their mortgage with BOA? I'm actually looking for more information on this. What department do you contact to make a settlement offer on the principal mortgage (I'm in a 80/20 split between two servicers.) I actually posted this as a topic in the Short-Sale forum Is this possible? Purchase home myself?

I do not want to spend the next 20 years in this loan. I'd be willing to settle as high as 35%.

[davephx]

Over the last few years I recall some settlments but rare. Usually folks offer something and BofA refuses.

Not to be confused with posts about BofA CREDIT CARDS which have settled 20-30% payments but that is far different since they have to take the loss at 180 days unlike a mortgage where they are worse off if settle vs just holding it.

[troubleinriverside]

Over the last few years I recall some settlments but rare. Usually folks offer something and BofA refuses.

Not to be confused with posts about BofA CREDIT CARDS which have settled 20-30% payments but that is far different since they have to take the loss at 180 days unlike a mortgage where they are worse off if settle vs just holding it.

Makes you wonder what their waiting for when they could at at least salvage something by accepting an offer.

[davephx]

If they just let it be deliquent they don't have to write it off. If they take a 10% settlement they have to take a hit against profits of 90% of it. So delay any action as long as possible.

[troubleinriverside]

If they just let it be deliquent they don't have to write it off. If they take a 10% settlement they have to take a hit against profits of 90% of it. So delay any action as long as possible.

Then they are getting away with some crafty accounting methods. In my business, we are required to move a loss over to the "Risks" column as soon as we suspect it/ or after 6 months (I know this from sitting in weekly meetings). Particularly since SarBaines-Oxly, there is no messing around with the books

[ginnywilcox]

They will have to wait an awful long time to try to collect anything on my house. Over 200K under water....2nd loan (with BofA) is 100K...house values keep droping here. Non-recouse loan and state...I would say a good 10 years before I break even with the first...depending how much further house prices drop....longer still if they want to get any money..... They will then still have to convince the 1st (which is HAMP and I am current and happpy with at PNC) to do a foreclosure.....I can wait a long time too....Will be very interesting....

[thelastgoal]

I am doing the same thing troubleinriverside is. BTW my 1st was HAMP with PNC and I originally had a 2nd with PNC that was bought out by countrywide years ago (and we know the bofa/Countrywide story), so I am wondering if davphx was on to something there...

Anyway, I got the 2MP offer letter a week ago. We finally decided not to pay them in November. So there is a trail payment plan only if you are late, if you are not, it is automatic. I told them to bascially...kiss my bu*** that I am so far underwater the trail mod at 2% interest only for 5 years is nothing. I copied the 2MP extinguishment option and highly recommended they take that offer from the 2MP program because otherwise I will either walk away (strategic default) or wait and settle with collections for 5 to 10%. I have years...probably 8-10 years before our house would have enough equity on the first for the whole foreclosure on the 2nd could even happen.

I also gave them a copy of my current county tax assessment which shows our house is 200K (and falling) underwater...thier loan is 100K. I wonder what is going to happen....not sure why they wouldn't take the 2MP extinguishment option other than "not wanting to negotiate with terrorist" i.e. me refusing to pay another penny to them...BTW the 2MP extinguishment offer goes down in money if they wait longer than 6 months of being late...so they only have a couple of months to make the decision to take the money (either .10 or .15 cents on the dollar....we are on the cusp of 140% underwater so depends on how they calculate our house value) otherwise they only get .6 on the dollar for loans that are 6 months late regardless of the % underwater.

I am in the similar situation. My 1st is HAMPed (investor BofNY) last year. I started 2MP trial payments (investor BofA) last month. Both loans are serviced by BofA. My house is underwater $200K. 2nd loan is $135K. They are offering 1 percent for five years, and then mirror the 1st for the rest.

I would like them to extinguish it. Were you able to get anywhere with your extinguishment offer to BofA?

[ginnywilcox]

I am in the similar situation. My 1st is HAMPed (investor BofNY) last year. I started 2MP trial payments (investor BofA) last month. Both loans are serviced by BofA. My house is underwater $200K. 2nd loan is $135K. They are offering 1 percent for five years, and then mirror the 1st for the rest.

I would like them to extinguish it. Were you able to get anywhere with your extinguishment offer to BofA?

No, they offered the same thing you received. I told them that wasn't acceptable. After about 8 months they finally replied to my letter stating they are withdrawing the 2MP offer because I violated it and didn't pay the trial payment. I really don't believe they are offering to extinguish anything.....since I am about 300K underwater including their 2nd and I am happy with my first (crazy to pay on a first loan that is 200K underwater I know but I really love our home). I have since decided to use the "strategy for settleing the second" posting and just ignore the whole thing. I am probably not ever going to sell my home and in California we have a no-recourse for purchase only loans (that is what mine is). They also can only legally collect a loan up to 4 years from when the loan is late. My house will still be way underwater....so they can still kiss my you know what

I deleted the loan off of my quicken financial program so I am slowly forgetting I owe them anything. My credit was hit about 100 points (I was high...now probably normal) or so but I just bought a new car using my lovely credit union and had absolutely no problem getting a very low interest rate(3.24&#37.

Best of luck! I hope they realize what they are doing. In 2009 I was willing to pay them some money (I was still current but needing assistance), now I could care less.

[John12333]

[QUOTE=ginnywilcox;390199]... They also can only legally collect a loan up to 4 years from when the loan is late. My house will still be way underwater....so they can still kiss my you know what


Hi Ginny,

What do you mean when you said that they can legally collect a loan up to 4 years in CA?

If you don't pay your 2nd for the next 20 years, and they still decide not to settle, will all the late fee and interest continues to add on the 2nd and now they can forclose since the first is no longer underwater?

[ginnywilcox]

Hi John1233,

California has a statue of limitation for collecting debt which is 4 years. Keep in mind I am talking about a on non-recourse loan. Note there will still be a lien on the house though...that will never go away until I settle with who ever has the lien (20 or 30 years later..but it is not tied to the dollar amount anymore)...or strip it in bankruptcy. For me, and the foreseeable future, my husband and I are going to stay here through retirement....so I could care less about the lien. I hope that makes sense. You can Google statue of limitations for California debt collections that should help you....again I think it has to be non-recourse (purchase only or some second loans state it is non-recourse).

[HeavySigh]

Hi John1233,

California has a statue of limitation for collecting debt which is 4 years. Keep in mind I am talking about a on non-recourse loan. Note there will still be a lien on the house though...that will never go away until I settle with who ever has the lien (20 or 30 years later..but it is not tied to the dollar amount anymore)...or strip it in bankruptcy. For me, and the foreseeable future, my husband and I are going to stay here through retirement....so I could care less about the lien. I hope that makes sense. You can Google statue of limitations for California debt collections that should help you....again I think it has to be non-recourse (purchase only or some second loans state it is non-recourse).

This offers an interesting possibility: BK7 now and lose the mortgage debt without any payments, and then BK13 in 5 years (and strip the lien).

[davephx]

Then they are getting away with some crafty accounting methods. In my business, we are required to move a loss over to the "Risks" column as soon as we suspect it/ or after 6 months (I know this from sitting in weekly meetings). Particularly since SarBaines-Oxly, there is no messing around with the books

Yes, Sarbanes-Oxley is mostly good overall since officers etc are personally liable for inforation that inflates profits/stock values if a public company. BofA has to set up a loss reserve but on overall portfolio of mortgages and can use historical loss ratios etc.

But if they don't take losses they can probably get away with out "real world" write downs to today's real values etc.

2nds are very different from most 1sts of course since 2nds are for the most part owned by the original bank lender (or in BofA's case Countrywide that it bought). Banks lose money (take write down against profits which hurts their stock) on 2nds but make money by foreclosing on most 1sts where they are only serviceres and make huge profits as such by foreclosing.

They have no incentive to take losses on 2nds or 2MP very low extingishments since hurts their loss reserve calculations. Unlike unsecired credit cards they do not have to write-off in 180 days. They do have to adjust loss reserves but can probably get away with less losses since do not have to take into consideration the value behind the mortgage lien. Only loss history as I understand it.

[fed up with BofA]

WOW! Seems like so many have received 2MP offers, but not me! I received HAMP in Feb11, denied 2MP for no reason, then a 2nd denial letter bc "didnt receive requested docs" which of course were never even requested. Was current on both 1st & 2nd, until OCT11- stopped paying on the 2nd. 6 months later received Notice of Intent to Foreclose! House is way underwater, live in CALI- non recourse state, advice?

[davephx]

BofA often screwed up. I also received letter in 2011 denied for 2MP since 1st they said wasn't hamped, but was in 2010.

They finally did 2MP correctly but the longer they screw up and delay the more money they make since they get the high interest as long as possible which is rolled up into the principal. Just part of the banks consumer fraud.

I had NOD in 2008 or 2009 on 2nd. As long as underwater not likely to foreclose assuming they own the 2nd as most banks do - the opposite of 1sts.

[fed up with BofA]

Thanks davephx,

I just looked up 2MP on BofA website. New qualification-must have past balance due of more than $5000, so that would explain it, they change the rules all the time. I am penalized for only being behind $2800, this gets me denied for a 2MP but triggers a Notice of Intent to forclose, how ridiculous is that!

[davephx]

Qualify if:

"you have a home equity account with an outstanding principal balance of at least $5,000 plus a home equity monthly payment amount of at least $100."

The entire 2nd has to be less than $5000 not just the amount behind in order not to qualify. Or payment less than $100.

[davephx]

And qualification is automatic for 2MP if 1st HAMPed. There is NO paperwork required. They try to get you into an inferior inhouse 2nd but hold out for 2MP and BofA is doing them eventually.

[fed up with BofA]

Thanks for clarifying-then I should definitely qualify... any advice on how I should proceed at this point? I appreciate your help.

[imsocalresident]

Hi Dave.
If I accept 2mp and pay regularly. And ask settlement ?
Does it make sense ?

BofA seems to be turning on the 2mp machine.

As a few others posted on another thread some of us got BofA 2MP papers this week.

Seems are all following 2MP. No paperwork needed to qualify just send in a Dodd-Frank Law certification that you haven't been convicted of mortgage fraud in the past 10 years.. with Fed Ex envelope to return.

3 Month trial as 2MP requires at 1%/40 years for first 5 years following the HAMP step up afterwards. All correct per 2MP requirements.

2nd went from $540 at 9.1% to about $183 for first 5 years. It does not show the past roll up amount from about 2 years of not paying but should be about about $12,000 and the payment seems about right on about $70,000 (was 60K). The rollup should be only interest not the full payment and no late payments.

Letter says will compute exact amount after trial. My 1st was Citi which was HAMPed then sold to the IBM company.

This is both good and bad news. It is nice to have it settled but the home which I love and hope to never leave is way underwater just on the 1st (Phoenix) so I doubt if they would foreclose on the 2nd even if didn't agree to terms of 2MP. It will take probably longer than my lifetime to have equity but I don't care since again I love it and only care about the payments have to make. The 1% on 2nd and 2% on first for 5 years offsets the under water equity so paying a market rate on far lower equivalent mortgage.

The problem will be in 5-10 years the step rate increases to about 5%, but both will be less than pre modified payments at highest eventual amount.

The last thing I am concerned about is "dead equity" in a home I hope to never leave or sell.

It is a Frank Lloyd Wright like design with a beautiful view of No Phoenix and mountains. Have million+ homes nearby (and across street) but mine is smaller and original cost in peak of market in 2007 of $410k and I had to go above the list price of $395k in a bidding war for it. About 2200 sq feet perfect for single old me and ideal office in home set up, 0.25 acre lot. Zillow value down to about $275k A few years ago lots across the street that are less easy to built because of slope and smaller were on market for $200k because of sweeping views. Two are still not sold and one a builder built a $1m+ home on he lives in across the street from me.

Area not good for pets - a coyote killed the prior owners dog and I hear them whaling at night but so nice and quit otherwise.