Joining the "You do not Qualify" club. Questions. - Loan Modification Forum

priv8pilot · 08-12-2009, 08:42 PM

After reading here for a couple of months I thought it might be time to jump in and tell you my story. It looks like this is going to take a long time. I am sure I will have many questions along the way so I thought I would join my new family of people going through the same things with this MHA program. Things at work have gotten bad with layoffs and general slowdowns. After looking at Chase’s website (You all know the one. The site that says they would LOVE to help us out) I called Chase and informed them of my concerns and was told that due to my changing income and the type of loan I have I qualify for the MHA plan. I was told to go to there web site, down load all the papers, fill them out and fax them in. I did all that, called to confirm they were received and was told all is good, call back in 2 weeks. I called back and then was told call back in 7-8 weeks. Well that 8 weeks is next week. But….. 4 days ago I received a letter from Chase stating the following:

‘After researching your account, we have determined that you do not qualify for a modification under the MHA program at this time for the following reasons.

Your property equity exceeds our program guidelines
Your application has been denied by the investor’

First reason is equity? I owe $400,000 Zillow says my house is worth 330,000 and the only thing selling is repos in the 250,000 range. So what does Your property equity exceeds our program guidelines actually mean?

Second is my loan is through Fannie Mae and from what I gather they ARE working on loan mods.

If I am wrong please steer me in the correct position. I am so upset as many here are. I have put on my gear and am ready for battle I just need some advise and direction. Thanks all,
Steve

MAXIE19 · 08-12-2009, 09:00 PM

What are the specifics and terms of your loan?
What is your hardship situation?
What does "changing income" mean.
Have you tried NACA and Chase's Executive Team?
Have you researched your home value on other websites other than Zillow? Try Chase, Cyberhomes.
Where do these websites place your home value?
Have you tried running the NPV test on your home?
Additional details may be helpful in analyzing your situation.

priv8pilot · 08-12-2009, 10:00 PM

Maxie19. Thanks for the quick reply.

Terms of loan 6% fixed 30 year Fannie mae

Hardship is loss of income due to work slowdown. Commission only and has been dropping to almost half of what I was making 2 years ago.

NACA? don't know what that is but will research it. I Just got the decline letter 4 days ago and have not contacted Chase yet. I was hoping to get some ideas here as to how to approach this decline letter.

Just went to Cyberhomes. Value there is 252,000 (now I am really depressed) How do I check it with chase?

And last but not least what is the the NPV test?
Steve

SillyWorld · 08-12-2009, 11:29 PM

go to www.naca.com and click on save my home and become a member it is FREE

briknope · 08-13-2009, 03:13 AM

one more question, how late are you on your payments?

priv8pilot · 08-13-2009, 06:29 AM

I am not late on any payments. But the savings is now all but gone.
I checked chase and the value at there site is 330,000 also
Steve

MAXIE19 · 08-13-2009, 06:44 AM

What is your monthly mortgage payment?
Are you escrowed? If so, how much is your monthly taxes and insurance?
You will need these numbers to check to see whether you pass the NPV test and whether the bank considers a modification beneficial. Of course, we do not know the variables that the bank uses, however, it is a starting point.

Run your numbers through the NPV test and see what it gives you.

FDIC: FDIC Loan Modification Program Guide – "Mod in a Box"

briknope · 08-13-2009, 09:20 AM

I'm trying to find an example of where a mod was offered or completed where the homeowner was current on mortgage. I tried and tried before I went late. When I did in fact become in default by 60 days then they talked to me.

shuladore · 08-13-2009, 11:10 AM

Hi MAXIE19 :

I have some questions about using the link to the NPV test you added (thanks by the way this looks very useful)! I wonder how much of it I need to change for instance do I only change the gray sections? any other info you could provide would much appreciatated

dnathan · 08-13-2009, 12:50 PM

Hi Priv8Pilot,

We just got the same letter with the same verbage about equity. Since Chase offers no accessible "Guidelines", it's something they made up to shovel our requests off their desk.

How much have you paid in equity?

We bought our home for $440 with two loans and paid one off. The remaining loan is $305K interest only. We're upside down with our home worth $265. If they have to sell our home at $250, say, they will walk away with $385K in value -- a gift from me.

A guy who works at Chase says they don't look at current home value when considering equity, just what you've paid on the loan. Their primary consideration is how they will come out when we foreclose.

If you stopped paying, you would proverbially put the gun to their head, and they would decide who had the bigger gun. IMO, your equity is the deciding factor.

MAXIE19 · 08-13-2009, 02:39 PM

You are right Shuladore. Since we do not know the variables that the bank is using, I only changed the gray areas. But the test does you give you a somewhat realistic picture of how much income you need to show to get a 2, 3, or 4% interest offer. Not everyone will qualify for the 2% rate, so it it best to work your numbers to achieve a pass using at least the 3% rate. The rep I spoke to said they are not offering anyone the 2% rate. Not true because I have read some success stories who were offered 2% rates by Chase. Could be because I have a super jumber loan. Anyway, I prepared two proposals using the 3% and 3.25% rates and I am waiting to hear back from them.

MAXIE19 · 08-13-2009, 02:41 PM

Briknope:

I believe ARDZSMITH recently received a 2% offer from Chase while staying current. You can read up on her thread.

AACPA · 08-13-2009, 06:52 PM

Quote:

I'm trying to find an example of where a mod was offered or completed where the homeowner was current on mortgage. I tried and tried before I went late. When I did in fact become in default by 60 days then they talked to me.

Chase wouldn't talk to me until I became 60 days late and then they denied me due to "value of home exceeds equity guidelines" and "income insufficient for credit requested". Both bogus reasons in my opinion.

MAXIE19 · 08-13-2009, 07:51 PM

AACPA:

I thought you stated earlier that the denial letter was based on the equity guidelines, did they include insufficient income in the denial letter as well?

AACPA · 08-13-2009, 08:57 PM

Quote:

AACPA:

I thought you stated earlier that the denial letter was based on the equity guidelines, did they include insufficient income in the denial letter as well?

Yes, the letter included both reasons and I copied them word for word

priv8pilot · 08-13-2009, 09:01 PM

Quote:

Originally Posted by MAXIE19

What is your monthly mortgage payment?
Are you escrowed? If so, how much is your monthly taxes and insurance?
You will need these numbers to check to see whether you pass the NPV test and whether the bank considers a modification beneficial. Of course, we do not know the variables that the bank uses, however, it is a starting point.

Run your numbers through the NPV test and see what it gives you.

FDIC: FDIC Loan Modification Program Guide – "Mod in a Box"

Monthly Mortgage payment is 2785.00 includes tax and insurance. I entered the numbers I have on the NPV test and it says I pass. Not sure what that is telling me. Late day at work and just getting into these responses. Will research some more.
Steve

priv8pilot · 08-13-2009, 09:11 PM

Quote:

Originally Posted by dnathan

Hi Priv8Pilot,

We just got the same letter with the same verbage about equity. Since Chase offers no accessible "Guidelines", it's something they made up to shovel our requests off their desk.

How much have you paid in equity?

We bought our home for $440 with two loans and paid one off. The remaining loan is $305K interest only. We're upside down with our home worth $265. If they have to sell our home at $250, say, they will walk away with $385K in value -- a gift from me.

A guy who works at Chase says they don't look at current home value when considering equity, just what you've paid on the loan. Their primary consideration is how they will come out when we foreclose.

If you stopped paying, you would proverbially put the gun to their head, and they would decide who had the bigger gun. IMO, your equity is the deciding factor.

Not sure what you mean by equity. I bought for $400,000 and put 40,000 down, I owe aprox 350,000.

Looking at your numbers: You owe $305K Sell for $250K isn't that a loss to the bank of $55K. Am I reading this wrong? Or missing something. I am not a loan expert and do not play one on TV!

Steve

priv8pilot · 08-13-2009, 09:17 PM

Does anyone have an idea why my loan would be denied by the investor’?The loan is through Fannie Mae. I thought they were part of the MHA plan, Or an I missing something?

priv8pilot · 08-13-2009, 09:26 PM

And how do I go about fighting this? Does this become a letter writing campaign? Or is this all done on the phone. I need some ideas on how to approach this and see if I can get it reopened. What have others done when they received a denial letter?
Thanks!
Steve

MAXIE19 · 08-13-2009, 09:45 PM

Priv8Pilot:

Mine never got to the investor.....so can't help you on that.....however, I have been denied twice by Chase and I am on my third submission through the Executive Resolution Office. I did start that process by sending an email to the CEO of Chase, Mr. Jamie Dimon. The good thing about the Executive team is they try different ways to make it work for you and can also escalate your file. Adjudicating my resubmissions have taken about a week, as compared to going back in line for another 3-4 months. Also, try NACA. Several people on the forum have gotten help there after being denied by the lender.

azdmsmith · 08-13-2009, 10:25 PM

I don't have paperwork yet but am supposedly starting a trial period with 2% interest as that is what it took to get my payment to 31% of my gross income (include taxes, ins, and HOA dues). My payments were current. As of a November '08 appraisal I had $100K in equity, according to Zillow and Cyberhomes I am now underwater about 10-60K. Chase did a BPO including pictures of the interior of my home, but I was never told what number they came up with for the BPO or NPV test. My investor is FannieMae and Chase must therefore follow FannieMae Servicing Guidelines 09-07R (on FannieMae web page). Dont fall for the "those are simply guidelines" story.

Definitely a letter writing campaign. Jamie Dimon, Better Business Bureau, FannieMae, OCC, and Chase exec resolutions in writing and online. Refer to the FannieMae guidelines by page number and tell them where/how the guidelines have been misapplied.

Garry · 08-14-2009, 02:20 AM

Quote:

Originally Posted by priv8pilot

After reading here for a couple of months I thought it might be time to jump in and tell you my story. It looks like this is going to take a long time. I am sure I will have many questions along the way so I thought I would join my new family of people going through the same things with this MHA program. Things at work have gotten bad with layoffs and general slowdowns. After looking at Chase’s website (You all know the one. The site that says they would LOVE to help us out) I called Chase and informed them of my concerns and was told that due to my changing income and the type of loan I have I qualify for the MHA plan. I was told to go to there web site, down load all the papers, fill them out and fax them in. I did all that, called to confirm they were received and was told all is good, call back in 2 weeks. I called back and then was told call back in 7-8 weeks. Well that 8 weeks is next week. But….. 4 days ago I received a letter from Chase stating the following:

‘After researching your account, we have determined that you do not qualify for a modification under the MHA program at this time for the following reasons.

Your property equity exceeds our program guidelines
Your application has been denied by the investor’

First reason is equity? I owe $400,000 Zillow says my house is worth 330,000 and the only thing selling is repos in the 250,000 range.

I think your mis-understanding something, you can be to upside down on your first mortgage to qualify, and I think that's what is going on here. You have to much negative equity, there is a limit.

Garry · 08-14-2009, 02:43 AM

Quote:

Originally Posted by Garry

I think your mis-understanding something, you can be to upside down on your first mortgage to qualify, and I think that's what is going on here. You have to much negative equity, there is a limit.

Your trying to prove the current market value of your house is worth less than what they are saying, when you should be trying to prove it's worth more. If you owe 400k on your house and they say it's only worth 250k, I think your way over the 125% limit to qualify. If you had two mortgages they would only use the balance on the first to qualify you and it wouldn't matter how much you owed on the second as long as the first was within the 125%. It might be time to start looking for other avenues, if that 400k is all on the first, I think your in way to deep.

MAXIE19 · 08-14-2009, 05:02 AM

Someone correct me if I am wrong, however I was under the impression that the 125% limit applies to refinancing under the Obama plan and not to modifications. There is no such limit as to how underwater you can be for a modification.

For purposes of modification, the more negative your equity, the better, as it shows that it is more in the bank's interest to modify than to foreclose as they stand to lose so much on their investment if they were to foreclose. To illustrate this point, plug in your numbers in the NPV model/test and you will see that the figures for the benefits from modification increases the more underwater you are. On the contrary, the more equity you have, the benefits from modification reduces substantially.

My previous Chase rep also confirmed this point when she told me that my value coming in at over 100K less than my unpaid principal balance tells them that my options to refinance or sell have been foreclosed or substantially reduced.

So yes, the more underwater you are, the better for purposes of a modification.

dnathan · 08-14-2009, 10:18 AM

Thank you Maxie. We paid $2700 in December and were denied last week. I think we're going to get back on the horse and try it through CET &/or NACA.

08-12-2009, 08:42 PM	#1 (permalink)
priv8pilot Member Join Date: Aug 2009 Posts: 16 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Joining the "You do not Qualify" club. Questions. After reading here for a couple of months I thought it might be time to jump in and tell you my story. It looks like this is going to take a long time. I am sure I will have many questions along the way so I thought I would join my new family of people going through the same things with this MHA program. Things at work have gotten bad with layoffs and general slowdowns. After looking at Chase’s website (You all know the one. The site that says they would LOVE to help us out) I called Chase and informed them of my concerns and was told that due to my changing income and the type of loan I have I qualify for the MHA plan. I was told to go to there web site, down load all the papers, fill them out and fax them in. I did all that, called to confirm they were received and was told all is good, call back in 2 weeks. I called back and then was told call back in 7-8 weeks. Well that 8 weeks is next week. But….. 4 days ago I received a letter from Chase stating the following: ‘After researching your account, we have determined that you do not qualify for a modification under the MHA program at this time for the following reasons. Your property equity exceeds our program guidelines Your application has been denied by the investor’ First reason is equity? I owe $400,000 Zillow says my house is worth 330,000 and the only thing selling is repos in the 250,000 range. So what does Your property equity exceeds our program guidelines actually mean? Second is my loan is through Fannie Mae and from what I gather they ARE working on loan mods. If I am wrong please steer me in the correct position. I am so upset as many here are. I have put on my gear and am ready for battle I just need some advise and direction. Thanks all, Steve

08-12-2009, 09:00 PM	#2 (permalink)
MAXIE19 Senior Member Join Date: May 2009 Posts: 265 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. What are the specifics and terms of your loan? What is your hardship situation? What does "changing income" mean. Have you tried NACA and Chase's Executive Team? Have you researched your home value on other websites other than Zillow? Try Chase, Cyberhomes. Where do these websites place your home value? Have you tried running the NPV test on your home? Additional details may be helpful in analyzing your situation.

08-12-2009, 10:00 PM	#3 (permalink)
priv8pilot Member Join Date: Aug 2009 Posts: 16 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. Maxie19. Thanks for the quick reply. Terms of loan 6% fixed 30 year Fannie mae Hardship is loss of income due to work slowdown. Commission only and has been dropping to almost half of what I was making 2 years ago. NACA? don't know what that is but will research it. I Just got the decline letter 4 days ago and have not contacted Chase yet. I was hoping to get some ideas here as to how to approach this decline letter. Just went to Cyberhomes. Value there is 252,000 (now I am really depressed) How do I check it with chase? And last but not least what is the the NPV test? Steve

08-12-2009, 11:29 PM	#4 (permalink)
SillyWorld Senior Member Join Date: Apr 2009 Location: Central Pennsylvania Posts: 1,139 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. go to www.naca.com and click on save my home and become a member it is FREE __________________ Central PA, USA Waiting NACA Approval With Citi ON FHA MORTGAGE 05/18/2009 Ginnie Mae investor Is NACA Becomming a SCAM..?

08-13-2009, 03:13 AM	#5 (permalink)
briknope Senior Member Join Date: Jan 2009 Posts: 170 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. one more question, how late are you on your payments?

08-13-2009, 06:29 AM	#6 (permalink)
priv8pilot Member Join Date: Aug 2009 Posts: 16 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. I am not late on any payments. But the savings is now all but gone. I checked chase and the value at there site is 330,000 also Steve

08-13-2009, 06:44 AM	#7 (permalink)
MAXIE19 Senior Member Join Date: May 2009 Posts: 265 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. What is your monthly mortgage payment? Are you escrowed? If so, how much is your monthly taxes and insurance? You will need these numbers to check to see whether you pass the NPV test and whether the bank considers a modification beneficial. Of course, we do not know the variables that the bank uses, however, it is a starting point. Run your numbers through the NPV test and see what it gives you. FDIC: FDIC Loan Modification Program Guide – "Mod in a Box"

08-13-2009, 09:20 AM	#8 (permalink)
briknope Senior Member Join Date: Jan 2009 Posts: 170 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. I'm trying to find an example of where a mod was offered or completed where the homeowner was current on mortgage. I tried and tried before I went late. When I did in fact become in default by 60 days then they talked to me.

08-13-2009, 11:10 AM	#9 (permalink)
shuladore Senior Member Join Date: Aug 2009 Posts: 78 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. Hi MAXIE19 : I have some questions about using the link to the NPV test you added (thanks by the way this looks very useful)! I wonder how much of it I need to change for instance do I only change the gray sections? any other info you could provide would much appreciatated

08-13-2009, 12:50 PM	#10 (permalink)
dnathan Member Join Date: Apr 2009 Posts: 17 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. Hi Priv8Pilot, We just got the same letter with the same verbage about equity. Since Chase offers no accessible "Guidelines", it's something they made up to shovel our requests off their desk. How much have you paid in equity? We bought our home for $440 with two loans and paid one off. The remaining loan is $305K interest only. We're upside down with our home worth $265. If they have to sell our home at $250, say, they will walk away with $385K in value -- a gift from me. A guy who works at Chase says they don't look at current home value when considering equity, just what you've paid on the loan. Their primary consideration is how they will come out when we foreclose. If you stopped paying, you would proverbially put the gun to their head, and they would decide who had the bigger gun. IMO, your equity is the deciding factor.

08-13-2009, 02:39 PM	#11 (permalink)
MAXIE19 Senior Member Join Date: May 2009 Posts: 265 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. You are right Shuladore. Since we do not know the variables that the bank is using, I only changed the gray areas. But the test does you give you a somewhat realistic picture of how much income you need to show to get a 2, 3, or 4% interest offer. Not everyone will qualify for the 2% rate, so it it best to work your numbers to achieve a pass using at least the 3% rate. The rep I spoke to said they are not offering anyone the 2% rate. Not true because I have read some success stories who were offered 2% rates by Chase. Could be because I have a super jumber loan. Anyway, I prepared two proposals using the 3% and 3.25% rates and I am waiting to hear back from them.

08-13-2009, 02:41 PM	#12 (permalink)
MAXIE19 Senior Member Join Date: May 2009 Posts: 265 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. Briknope: I believe ARDZSMITH recently received a 2% offer from Chase while staying current. You can read up on her thread.

08-13-2009, 07:51 PM	#14 (permalink)
MAXIE19 Senior Member Join Date: May 2009 Posts: 265 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. AACPA: I thought you stated earlier that the denial letter was based on the equity guidelines, did they include insufficient income in the denial letter as well?

08-13-2009, 09:17 PM	#18 (permalink)
priv8pilot Member Join Date: Aug 2009 Posts: 16 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. Does anyone have an idea why my loan would be denied by the investor’?The loan is through Fannie Mae. I thought they were part of the MHA plan, Or an I missing something?

08-13-2009, 09:26 PM	#19 (permalink)
priv8pilot Member Join Date: Aug 2009 Posts: 16 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. And how do I go about fighting this? Does this become a letter writing campaign? Or is this all done on the phone. I need some ideas on how to approach this and see if I can get it reopened. What have others done when they received a denial letter? Thanks! Steve

08-13-2009, 09:45 PM	#20 (permalink)
MAXIE19 Senior Member Join Date: May 2009 Posts: 265 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. Priv8Pilot: Mine never got to the investor.....so can't help you on that.....however, I have been denied twice by Chase and I am on my third submission through the Executive Resolution Office. I did start that process by sending an email to the CEO of Chase, Mr. Jamie Dimon. The good thing about the Executive team is they try different ways to make it work for you and can also escalate your file. Adjudicating my resubmissions have taken about a week, as compared to going back in line for another 3-4 months. Also, try NACA. Several people on the forum have gotten help there after being denied by the lender.

08-13-2009, 10:25 PM	#21 (permalink)
azdmsmith Senior Member Join Date: Mar 2009 Posts: 118 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. I don't have paperwork yet but am supposedly starting a trial period with 2% interest as that is what it took to get my payment to 31% of my gross income (include taxes, ins, and HOA dues). My payments were current. As of a November '08 appraisal I had $100K in equity, according to Zillow and Cyberhomes I am now underwater about 10-60K. Chase did a BPO including pictures of the interior of my home, but I was never told what number they came up with for the BPO or NPV test. My investor is FannieMae and Chase must therefore follow FannieMae Servicing Guidelines 09-07R (on FannieMae web page). Dont fall for the "those are simply guidelines" story. Definitely a letter writing campaign. Jamie Dimon, Better Business Bureau, FannieMae, OCC, and Chase exec resolutions in writing and online. Refer to the FannieMae guidelines by page number and tell them where/how the guidelines have been misapplied.

08-14-2009, 05:02 AM	#24 (permalink)
MAXIE19 Senior Member Join Date: May 2009 Posts: 265 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. Someone correct me if I am wrong, however I was under the impression that the 125% limit applies to refinancing under the Obama plan and not to modifications. There is no such limit as to how underwater you can be for a modification. For purposes of modification, the more negative your equity, the better, as it shows that it is more in the bank's interest to modify than to foreclose as they stand to lose so much on their investment if they were to foreclose. To illustrate this point, plug in your numbers in the NPV model/test and you will see that the figures for the benefits from modification increases the more underwater you are. On the contrary, the more equity you have, the benefits from modification reduces substantially. My previous Chase rep also confirmed this point when she told me that my value coming in at over 100K less than my unpaid principal balance tells them that my options to refinance or sell have been foreclosed or substantially reduced. So yes, the more underwater you are, the better for purposes of a modification.

08-14-2009, 10:18 AM	#25 (permalink)
dnathan Member Join Date: Apr 2009 Posts: 17 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Joining the "You do not Qualify" club. Questions. Thank you Maxie. We paid $2700 in December and were denied last week. I think we're going to get back on the horse and try it through CET &/or NACA.

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