any NPV tests that did NOT fail?

[inthegarden]

I'm hearing a lot about NPV tests that fail. Are there cases when the bank actually allows one to pass?

Let's say a mortgage is $100K more than the fair market value. Is it more favorable to have less equity and a steady income?

I don't know how they predict the probability of foreclosure if the payment was affordable. Without fully understanding this NPV calculation, how can borrowers challenge the figures? It is a complicated calculation.

At first glance, I would think that I would qualify for HAMP, but then when it comes to NPV calculation, they seem to have enough leeway to make any NPV test fail.

[mum23kids]

There is an excel worksheet on the fdic website that is fairly simple and if your numbers are accurate it should give you a good idea if you will pass or not. I completed it with several different scenerios using high and lows for home value and income and I passed every time-I printed them out to send to my bank if thye find I "failed". I am not going odwn without a fight.

[davephx]

There are modifications getting done (Citi quite a few recently) so some are passing and they can't really manipulate that much only certain historic variables where large banks can use their actual default rates etc vs averages in the formula.

I was told long long ago, I passed. Now on 8th trial and 1 year battle.

[inthegarden]

Thank you for the link. This is good to have.