Bank of America Loan Modification 101 - Loan Modification Forum

oc949 · 07-28-2009, 09:34 PM

The purpose of this post is to distill the hard-earned experience that I have gained over the last 18 months dealing with Countrywide, now Bank of America in the area of loan modification.

If you are just starting a loan modification effort, I hope that this post helps you understand the road ahead. If you are in the middle of one then I hope this post may address some of the frustrations that you are having. I have written my post in an easy to digest Q&A format.

Good luck to everyone.

Q. What is a Loan Modification?

When the lender agrees to change the terms on your existing loan to make the monthly payments more affordable for you. The change in terms may include any of: interest rate reduction, principal forgiveness, or the forbearance of missed payments and late fees (which are added back into the loan principal).

Q. I am unemployed. Do I qualify for loan modification?

Currently no. Lenders have formulas that are supposed to reset your mortgage payments to around one third of your monthly income. But if you have no monthly income then the lender is not interested in working with you.

Q. I am collecting unemployment insurance. Does this count as monthly income?

Currently no. The lender requires that you have wage income from a salaried or hourly job. There are rumors that this may change in the future.

Q. My home is underwater. Will I still qualify for a loan modification?

Yes, you can still qualify for a loan modification. The lender’s calculations are based on your ability to continue paying a mortgage rather than the value of your home. It does not matter to them if your home is underwater if you are still willing and able to pay an adjusted mortgage amount that will allow you to wait out the drop in home value and eventually pay back the entire mortgage amount.

Q. Will Obama’s plan help me?

The Obama Administration’s Making Home Affordable (MHA) initiative is designed to help homeowners who are no more than 5% underwater and who hold mortgages that are backed by Fannie Mae or Freddie Mac. Look up your loan at Making Home Affordable - Look Up Your Loan. The initiative incents lenders to complete loan modifications by paying them around $1,800 for every successful loan modification. To date the initiative has been a relative failure since it has only resulted in 200,000 loan modification offers, in comparison with millions of foreclosures, short sales and deed-in-lieus of foreclosure, not to mention people who just give up and walk away from their homes. Obama summoned a selected group of lenders to a meeting at the end of July to urge faster action and a revised goal of 500,000 completed loan modifications by November. But your loan still needs to meet the basic qualifications.

Q. What outcome can I expect from the Loan Modification process?

The lender will typically lower your interest rate for a short period of time, around 5 months, and then gradually raise it in stages until it is close to your original interest rate. You can expect your missed payments and late fees to be added to the loan principal. The primary advantage of loan modification is that it can convert your variable mortgage into a fixed mortgage with predictable payments for the remainder of the term. Some homeowners report that the lender lowers their interest rates to a much lower amount and fixed for the life of the loan, particularly loans that were modified in the period from April to June 2009. It is possible that this represents a new trend but for now this type of modification is the exception, not the rule. Typically the lender tests you out for the first 5 months to ensure you can handle adjusted payments. Two thirds of loan modifications end up delinquent again. Lenders know this and so they are very selective with whom they grant modifications too. Many people report that loan modification packages barely put a dent in your existing payments.

Q. Lenders prefer Loan Modification over Foreclosure, right?

Wrong. It is a myth that lenders want to avoid foreclosure. The foreclosure process only gets expensive for them if it drags out, or if they wait so long that the home value continues to drop. Obviously a lender would prefer that you stay in your home and continue to make payments. But they are concerned about the numbers, not about your personal well being. If you are too much of a hardship case, and they see no indication that you will ever become a stable paying customer again then they will not hesitate to foreclose on you. Lenders set the qualification bar very high. This, combined with their disorganization makes it very difficult to get a loan modification. This may change in the future but for now be aware that there are few guarantees in the loan modification and even more risks.

Q. Should I pay a loan modification company or consultant up front to handle my modification?

No! Not unless you have a direct referral from a trusted friend or family member and you know that the company is reputable and won’t just collect your fees in exchange for nothing. Many private loan modification companies collect your fees and then fail to do any work on your behalf. This has been well documented recently in a string of recent articles in the New York Times and other leading newspapers, as well as a slew of lawsuits against these loan modification companies.

Q. Great, sign me up for a Loan Modification. Where can I start?

You may deal with the lender directly, but for most people this path is an exercise in frustration. You rarely speak with the same person twice and it is common for your paperwork to be lost. Many homeowners report waiting months for the process to complete, only to be informed that they have to start over. The preferred routes are to go with a non-profit homeowner advocacy organization, or to work with a reputable attorney. Keep in mind that attorneys often want to pursue irregularities in loan paperwork and then sue or settle with the lender. But in this regard they often have limited ability to help you. There is a statute of limitations of 3 years on loans, so irregularities in loan paperwork are hard to chase down. Unless you have an especially exotic option mortgage, the best that an attorney can typically do for you is to stall foreclosure and give you more months of mortgage and rent free time. (Please note that I am not connected with any organization or law firm, this is my unbiased opinion).

Q. OK, so is a Loan Modification worth it?

Only you can answer that question, it is a very personal choice. But here are some things to keep in mind: do you want to keep the home? If you are far underwater then it may take years for your home to recover its value? Are you better off just short selling it? Walking away and foreclosure should be considered options of last resort, only after you have exhausted other options. Deed-in-lieu of foreclosures sound good on paper but are not popular with lenders. Also, if you have multiple mortgages then a short sale may not be an option for you. In this case, loan modification (with both lenders) may be a better choice for reducing your monthly mortgage burden. Ultimately you need to decide whether it is worth the fight to keep your home. For most homeowners it is, but just be prepared for a long haul and above all, don’t take anything personally. You are a pawn in a global financial system that cares little about your personal well being and everything about your ability to make good on your loan obligations. Pick your course of action, and stick to it, but don’t be afraid to make course corrections or even, at the very end of your long journey, decide that it’s time to walk away.

Good luck to you, I wish you well.

Moe Bedard · 07-29-2009, 08:45 AM

Awesome post and thanks for paying it forward to the community!

ped444 · 07-29-2009, 10:01 AM

is it best to hand write your hardship letter or type it

AzGryffindor · 07-29-2009, 10:02 AM

Moe: A great portion of the post you have made a sticky is incorrect and does not reflect recent changes and the implementation of the HAMP program.

For example:

Quote:

Q. What is a Loan Modification?

When the lender agrees to change the terms on your existing loan to make the monthly payments more affordable for you. The change in terms may include any of: interest rate reduction, principal forgiveness, or the forbearance of missed payments and late fees (which are added back into the loan principal).

Wrong.

Under HAMP the standard waterfall process is as follows:
1. Reduce the interest rate to as low as 2%.
2. Increase the term of the note up to as much as 40 years.
3. Principal FOREBEARANCE (not forgiveness).

Quote:

Q. Will Obama’s plan help me?

The Obama Administration’s Making Home Affordable (MHA) initiative is designed to help homeowners who are no more than 5% underwater and who hold mortgages that are backed by Fannie Mae or Freddie Mac. Look up your loan at Making Home Affordable - Look Up Your Loan. The initiative incents lenders to complete loan modifications by paying them around $1,800 for every successful loan modification. To date the initiative has been a relative failure since it has only resulted in 200,000 loan modification offers, in comparison with millions of foreclosures, short sales and deed-in-lieus of foreclosure, not to mention people who just give up and walk away from their homes. Obama summoned a selected group of lenders to a meeting at the end of July to urge faster action and a revised goal of 500,000 completed loan modifications by November. But your loan still needs to meet the basic qualifications.

The refinance portion was recently revamped to allow borrowers to refinance properties to up to 125% of their value.

He's also lumped modifications into the refinance portion of the HAMP. They are two separate programs.

Quote:

Q. What outcome can I expect from the Loan Modification process?

The lender will typically lower your interest rate for a short period of time, around 5 months, and then gradually raise it in stages until it is close to your original interest rate. You can expect your missed payments and late fees to be added to the loan principal. The primary advantage of loan modification is that it can convert your variable mortgage into a fixed mortgage with predictable payments for the remainder of the term. Some homeowners report that the lender lowers their interest rates to a much lower amount and fixed for the life of the loan, particularly loans that were modified in the period from April to June 2009. It is possible that this represents a new trend but for now this type of modification is the exception, not the rule. Typically the lender tests you out for the first 5 months to ensure you can handle adjusted payments. Two thirds of loan modifications end up delinquent again. Lenders know this and so they are very selective with whom they grant modifications too. Many people report that loan modification packages barely put a dent in your existing payments.

Wrong, Wrong, Wrong!!!!!

1. Under HAMP your interest rate gets lowered for 5 YEARS, not months. At the end of the 5 years, your interest rate will increase by one percentage point until it reaches whatever the Freddie Mac Index was on the date the formal modification was entered into. This could be higher but most likely lower than what most people are currently paying.

2. Missed payments will be added into the loan principal but late payments are absolutely forbidden to be added or charged to the consumer in any form.

3. "particularly loans that were modified in the period from April to June 2009. It is possible that this represents a new trend but for now this type of modification is the exception, not the rule."

Ugh. This is HAMP going into effect. It's not a new trend. It's a new government program. It is NOT the exception but is now the rule.

4. "Typically the lender tests you out for the first 5 months to ensure you can handle adjusted payments." Wrong again. The trial period is 3 months.

5. "Two thirds of loan modifications end up delinquent again. Lenders know this and so they are very selective with whom they grant modifications too." The HAMP program hasn't even been available long enough to gather data. The failed loan modifications were modifications that the banks drew up which only benefited the banks and not the consumer.

6. "Many people report that loan modification packages barely put a dent in your existing payments." I would suggest the OP take a good look around these forums to see just how much many of us are saving through either HAMP or NACA programs. I'm personally saving over $400/month under HAMP.

minknmelissa · 07-29-2009, 10:41 AM

You can get a loan modification through making home affordable program if you are not a fannie or freddie you just can't refi

oc949 · 07-29-2009, 10:43 AM

AzGryffindor, thank you for your post. You provided valuable information on the Home Afforable Modification Program (HAMP) which falls under MHA.

However, my post was not focused on HAMP, it was focused on loan modifications that borrowers pursue outside of MHA, HAMP or any program that is tied to loans that are backed by Fannie and Freddie. I had one bullet on MHA, and that was it. Many people do not have a mortgage backed by Fannie and Freddie and so are left to pursue loan modification on their own, without a federal mandate in place that perhaps will improve their chances of responsiveness from the lender and a successful outcome.

As you well know, information changes quickly, so please continue to provide updates as you get them.

jakelabry · 07-29-2009, 10:45 AM

AzGryffindor - I'm confused about this statement:

"2. Missed payments will be added into the loan principal but late payments are absolutely forbidden to be added or charged to the consumer in any form."

What is the difference between the two? Is a missed payment not also a late payment? When does a late payment officially become a missed payment?

Perhaps you meant late charges?

AzGryffindor · 07-29-2009, 10:51 AM

Quote:

Originally Posted by jakelabry

AzGryffindor - I'm confused about this statement:

"2. Missed payments will be added into the loan principal but late payments are absolutely forbidden to be added or charged to the consumer in any form."

What is the difference between the two? Is a missed payment not also a late payment? When does a late payment officially become a missed payment?

Perhaps you meant late charges?

Yes, late fees.

oc949 · 07-29-2009, 11:04 AM

And just to be clear, under MHA the current guidelines are: you can refinance your home with government backing guarantees and an incentive payment to the lender as long as your home is no more than 125% underwater. This number is expanded from the previous number of 105%.

Refinances are an alternate form of loan modification, but for clarity it is probably better to use the term refinance for situations where your interest rate payments are being changed.

But note that Timothy Geithner's letter to lenders in advance of yesterday's meeting refers to "loan modification":

HAMP « South Florida Law Blog

MHA requires a 3 month trial period to ensure that the borrower can keep up with adjusted payments. From scanning the forums here I do not see that a lot of people are getting these trial periods. Perhaps more people are, but they aren't posting about it.

Finally, under the stated guidelines on the MHA website you cannot be late on payments in order to qualify. The government is having to rethink this requirement since people who have run out of time waiting are now increasingly being forced to miss payments.

AzGryffindor · 07-29-2009, 11:58 AM

For better clarity since both programs involve changing your interest rate you might want to use the following:
HARP = Refinance
HAMP = Modification

Also, you do have to be current and have a loan backed by either Fannie Mae or Freddie Mac to qualify for the HARP.

However, for HAMP, you do not have to be current nor does your loan have to be backed by Fannie or Freddie. Your lender (not necessarily your servicer), must be participating in the program. Chances are if they received TARP funds that they are.

There's more than a few of us currently in the Trial Period of HAMP. There's also many more that are in a Trial Period through NACA.

e56046 · 07-30-2009, 04:31 PM

AZG:
Your handle of the current HARP & HAMP specifics are spot on!!! I understand that the Federal process for the HARP states that a borrower can use any Servicer, are you aware of any firms currently willing to utilize it? In addition, I believe that I read that the Government changed the rules pertaining to liquidity in a personal 401K program meaning that before “changes” the funds in a 401K were exempt from being considered as assets. Also, it is my understanding that a borrower may choose to voluntarily provide (or not) all members of the household incomes for the process of HAMP or HARP program. In contrast, while it is my understanding that all persons listed on the note must provide the required financial information to participate. What if the note simply states “Joe Shmoe a married man” is the spouse, who is unnamed considered “on the note?” therefore their income is required? Thanks for all of your posts.

miked2023 · 08-01-2009, 09:55 AM

I'm 60 days late and am ready to go to CW/BofA and propose a loan mod. My question is, where do I start? Loss mitigation? Call them up? I've got my hardship and financials all together so I guess I'm not sure what the first, best step is.

I'm going to propose a settlement on the 2nd and a 30 or 40 year fixed on the first. Also, I would like the first to be a step ladder so I can do some much needed work on the house with the extra money. Should I mention this as the reason why or just propose it straight out? What do people start at with step ladders? 2/3/4.5 ? Something like that? Thanks.

wattsm · 08-04-2009, 12:13 PM

I would add to this that anyone looking to deal with BofA should email Barbara Desoer (President of Home Loans) to get the ball rolling. They probably won't respond via email, but you'll get a call within a day or two, and they'll have a written record of your hardship which I feel is important for them to take you seriously. You can contact certain agents directly, and I know quite a few people here have recommended certain people, but I think that just sending the email to Barbara and letting them assign someone to you is the way to go-- you'll probably get someone who actually has the time to deal with your situation.

barbara.j.desoer@bankofamerica.com

There don't seem to be any Indian agents working out of the presidents office, and they all seem to be top notch people, unlike many of the people working at the official hardship assistance number. The funny thing is, the presidents office doesn't seem to be bothered by people contacting them directly. It's almost as if they have it set up so that people who make the extra effort to do some research and contact them directly are rewarded with competent agents, as opposed to the many people who will just call the number given on the BofA website.

One final suggestion-- if dealing with NACA, use their website to make phone appointments in advance. It takes several phone sessions to get your file completed, and you'll end up repeating the same information over and over again. This could take weeks, especially if you're dealing with inexperienced NACA counselors. Make appointments for several consecutive days, even two appointments a day. This will save A LOT of time. One day, I was just finishing up a phone appointment and my cell phone started ringing with my next appointment so I was able to pick right up with the next person. I had NACA call for pre-scheduled appointments after my file was complete, and I just used the appointments to confirm that everything was finished and my file was submitted.

bhuggs · 08-14-2009, 06:43 PM

Is anyone familiar with receiving a phone call for CW/BOA and being told that verbally that they have been approved for a loan modification thru HAMP and was given the trial three months payment and then the payments for the next five years? I have yet to receive any written confirmation but I have been called constantly for the last three months about making a payment but not that payment that was told to me.

Should I make the payment?

Thank you for the helpful information.

phoenix1979 · 09-04-2009, 02:04 PM

Hi,

I beleive you are going through the same thing as I am. Please read my thread: While in Trial Payment I was Declined for BofA

Thanks,

Pho

snapple candy · 11-11-2009, 12:10 PM

I am trying to help a client with former Countrywide now B of A HAMP trial mod. I have determined it is not Fannie Mae and still waiting to see if Freddie Mac. I am still trying to determine who actually is the owner of this CW loan. They definately dont qualify for HARP.

minknmelissa posted:

"You can get a loan modification through making home affordable program if you are not a fannie or freddie you just can't refi"

Just want to be make sure Can you get the HAMP program without it being a Fannie or Freddie loan with B of A/CW loan? Anything else I need to know before I proceed?

klauss54 · 11-19-2009, 03:38 PM

i finally got my fed ex this afternoon have to sign notary and money order for 0.00 must be mailed by 11-25 this is the end of this 16 month journey 2 percent fixed life of loan if it wasnt for this forum and naca i would have lost my house dont give up keep fighting and you will suceed good luck to all of you

breauxjsph · 11-19-2009, 05:23 PM

I need help with my financials. loan was through countrywide now I'm dealing with bank of america, my problem is that before I do the loan modification I'm short $230 per month. customer service keeps telling me that I need to have a surplus of $200 before I get the loan mod.
can any give me some advise.

ama125 · 11-19-2009, 06:54 PM

Quote:

Originally Posted by breauxjsph

I need help with my financials. loan was through countrywide now I'm dealing with bank of america, my problem is that before I do the loan modification I'm short $230 per month. customer service keeps telling me that I need to have a surplus of $200 before I get the loan mod.
can any give me some advise.

Sounds to me like they are reviewing you for an in-house mod. If you are eligible for it, I would insist they review you for HAMP as there is no surplus mandate to get qualified.

HereinDE · 11-19-2009, 07:22 PM

That's true. For HAMP, there is no surplus mandate, BUT the problem is that Bank of America doesn't want to give you HAMP modification. I got denied HAMP (2% 5 year interest) recently without any explanation.

07-28-2009, 09:34 PM	#1 (permalink)
oc949 Member Join Date: Feb 2009 Posts: 22 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Bank of America Loan Modification 101 The purpose of this post is to distill the hard-earned experience that I have gained over the last 18 months dealing with Countrywide, now Bank of America in the area of loan modification. If you are just starting a loan modification effort, I hope that this post helps you understand the road ahead. If you are in the middle of one then I hope this post may address some of the frustrations that you are having. I have written my post in an easy to digest Q&A format. Good luck to everyone. Q. What is a Loan Modification? When the lender agrees to change the terms on your existing loan to make the monthly payments more affordable for you. The change in terms may include any of: interest rate reduction, principal forgiveness, or the forbearance of missed payments and late fees (which are added back into the loan principal). Q. I am unemployed. Do I qualify for loan modification? Currently no. Lenders have formulas that are supposed to reset your mortgage payments to around one third of your monthly income. But if you have no monthly income then the lender is not interested in working with you. Q. I am collecting unemployment insurance. Does this count as monthly income? Currently no. The lender requires that you have wage income from a salaried or hourly job. There are rumors that this may change in the future. Q. My home is underwater. Will I still qualify for a loan modification? Yes, you can still qualify for a loan modification. The lender’s calculations are based on your ability to continue paying a mortgage rather than the value of your home. It does not matter to them if your home is underwater if you are still willing and able to pay an adjusted mortgage amount that will allow you to wait out the drop in home value and eventually pay back the entire mortgage amount. Q. Will Obama’s plan help me? The Obama Administration’s Making Home Affordable (MHA) initiative is designed to help homeowners who are no more than 5% underwater and who hold mortgages that are backed by Fannie Mae or Freddie Mac. Look up your loan at Making Home Affordable - Look Up Your Loan. The initiative incents lenders to complete loan modifications by paying them around $1,800 for every successful loan modification. To date the initiative has been a relative failure since it has only resulted in 200,000 loan modification offers, in comparison with millions of foreclosures, short sales and deed-in-lieus of foreclosure, not to mention people who just give up and walk away from their homes. Obama summoned a selected group of lenders to a meeting at the end of July to urge faster action and a revised goal of 500,000 completed loan modifications by November. But your loan still needs to meet the basic qualifications. Q. What outcome can I expect from the Loan Modification process? The lender will typically lower your interest rate for a short period of time, around 5 months, and then gradually raise it in stages until it is close to your original interest rate. You can expect your missed payments and late fees to be added to the loan principal. The primary advantage of loan modification is that it can convert your variable mortgage into a fixed mortgage with predictable payments for the remainder of the term. Some homeowners report that the lender lowers their interest rates to a much lower amount and fixed for the life of the loan, particularly loans that were modified in the period from April to June 2009. It is possible that this represents a new trend but for now this type of modification is the exception, not the rule. Typically the lender tests you out for the first 5 months to ensure you can handle adjusted payments. Two thirds of loan modifications end up delinquent again. Lenders know this and so they are very selective with whom they grant modifications too. Many people report that loan modification packages barely put a dent in your existing payments. Q. Lenders prefer Loan Modification over Foreclosure, right? Wrong. It is a myth that lenders want to avoid foreclosure. The foreclosure process only gets expensive for them if it drags out, or if they wait so long that the home value continues to drop. Obviously a lender would prefer that you stay in your home and continue to make payments. But they are concerned about the numbers, not about your personal well being. If you are too much of a hardship case, and they see no indication that you will ever become a stable paying customer again then they will not hesitate to foreclose on you. Lenders set the qualification bar very high. This, combined with their disorganization makes it very difficult to get a loan modification. This may change in the future but for now be aware that there are few guarantees in the loan modification and even more risks. Q. Should I pay a loan modification company or consultant up front to handle my modification? No! Not unless you have a direct referral from a trusted friend or family member and you know that the company is reputable and won’t just collect your fees in exchange for nothing. Many private loan modification companies collect your fees and then fail to do any work on your behalf. This has been well documented recently in a string of recent articles in the New York Times and other leading newspapers, as well as a slew of lawsuits against these loan modification companies. Q. Great, sign me up for a Loan Modification. Where can I start? You may deal with the lender directly, but for most people this path is an exercise in frustration. You rarely speak with the same person twice and it is common for your paperwork to be lost. Many homeowners report waiting months for the process to complete, only to be informed that they have to start over. The preferred routes are to go with a non-profit homeowner advocacy organization, or to work with a reputable attorney. Keep in mind that attorneys often want to pursue irregularities in loan paperwork and then sue or settle with the lender. But in this regard they often have limited ability to help you. There is a statute of limitations of 3 years on loans, so irregularities in loan paperwork are hard to chase down. Unless you have an especially exotic option mortgage, the best that an attorney can typically do for you is to stall foreclosure and give you more months of mortgage and rent free time. (Please note that I am not connected with any organization or law firm, this is my unbiased opinion). Q. OK, so is a Loan Modification worth it? Only you can answer that question, it is a very personal choice. But here are some things to keep in mind: do you want to keep the home? If you are far underwater then it may take years for your home to recover its value? Are you better off just short selling it? Walking away and foreclosure should be considered options of last resort, only after you have exhausted other options. Deed-in-lieu of foreclosures sound good on paper but are not popular with lenders. Also, if you have multiple mortgages then a short sale may not be an option for you. In this case, loan modification (with both lenders) may be a better choice for reducing your monthly mortgage burden. Ultimately you need to decide whether it is worth the fight to keep your home. For most homeowners it is, but just be prepared for a long haul and above all, don’t take anything personally. You are a pawn in a global financial system that cares little about your personal well being and everything about your ability to make good on your loan obligations. Pick your course of action, and stick to it, but don’t be afraid to make course corrections or even, at the very end of your long journey, decide that it’s time to walk away. Good luck to you, I wish you well.

07-29-2009, 08:45 AM	#2 (permalink)
Moe Bedard Founder Join Date: Aug 2007 Location: Southern California Posts: 16,887 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 Awesome post and thanks for paying it forward to the community! __________________ Moe Bedard Founder LoanSafe.org "America's #1 Home Loan Forum" LoanWorkout.org "America's # Loan Modification Blog" Get My FREE Loan Modification E-Book \| Please donate to LoanSafe.org \| Loan Modification Training For Attorneys \| Rate Your Mortgage Servicer The comments by me and the materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. Most of the information you find here is easily available on the internet. You should contact your attorney to obtain advice with respect to any particular issue or problem. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney. Please Read our Privacy Policy and Legal Disclaimer Here.

07-29-2009, 10:01 AM	#3 (permalink)
ped444 Junior Member Join Date: Jul 2009 Posts: 1 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 is it best to hand write your hardship letter or type it

07-29-2009, 10:41 AM	#5 (permalink)
minknmelissa Senior Member Join Date: Jul 2009 Posts: 277 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 You can get a loan modification through making home affordable program if you are not a fannie or freddie you just can't refi

07-29-2009, 10:43 AM	#6 (permalink)
oc949 Member Join Date: Feb 2009 Posts: 22 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 AzGryffindor, thank you for your post. You provided valuable information on the Home Afforable Modification Program (HAMP) which falls under MHA. However, my post was not focused on HAMP, it was focused on loan modifications that borrowers pursue outside of MHA, HAMP or any program that is tied to loans that are backed by Fannie and Freddie. I had one bullet on MHA, and that was it. Many people do not have a mortgage backed by Fannie and Freddie and so are left to pursue loan modification on their own, without a federal mandate in place that perhaps will improve their chances of responsiveness from the lender and a successful outcome. As you well know, information changes quickly, so please continue to provide updates as you get them.

07-29-2009, 10:45 AM	#7 (permalink)
jakelabry Senior Member Join Date: Jun 2009 Posts: 200 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 AzGryffindor - I'm confused about this statement: "2. Missed payments will be added into the loan principal but late payments are absolutely forbidden to be added or charged to the consumer in any form." What is the difference between the two? Is a missed payment not also a late payment? When does a late payment officially become a missed payment? Perhaps you meant late charges?

07-29-2009, 11:04 AM	#9 (permalink)
oc949 Member Join Date: Feb 2009 Posts: 22 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 And just to be clear, under MHA the current guidelines are: you can refinance your home with government backing guarantees and an incentive payment to the lender as long as your home is no more than 125% underwater. This number is expanded from the previous number of 105%. Refinances are an alternate form of loan modification, but for clarity it is probably better to use the term refinance for situations where your interest rate payments are being changed. But note that Timothy Geithner's letter to lenders in advance of yesterday's meeting refers to "loan modification": HAMP « South Florida Law Blog MHA requires a 3 month trial period to ensure that the borrower can keep up with adjusted payments. From scanning the forums here I do not see that a lot of people are getting these trial periods. Perhaps more people are, but they aren't posting about it. Finally, under the stated guidelines on the MHA website you cannot be late on payments in order to qualify. The government is having to rethink this requirement since people who have run out of time waiting are now increasingly being forced to miss payments.

07-29-2009, 11:58 AM	#10 (permalink)
AzGryffindor Senior Member Join Date: Jun 2009 Posts: 231 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 For better clarity since both programs involve changing your interest rate you might want to use the following: HARP = Refinance HAMP = Modification Also, you do have to be current and have a loan backed by either Fannie Mae or Freddie Mac to qualify for the HARP. However, for HAMP, you do not have to be current nor does your loan have to be backed by Fannie or Freddie. Your lender (not necessarily your servicer), must be participating in the program. Chances are if they received TARP funds that they are. There's more than a few of us currently in the Trial Period of HAMP. There's also many more that are in a Trial Period through NACA.

07-30-2009, 04:31 PM	#11 (permalink)
e56046 Member Join Date: Apr 2009 Posts: 9 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 AZG: Your handle of the current HARP & HAMP specifics are spot on!!! I understand that the Federal process for the HARP states that a borrower can use any Servicer, are you aware of any firms currently willing to utilize it? In addition, I believe that I read that the Government changed the rules pertaining to liquidity in a personal 401K program meaning that before “changes” the funds in a 401K were exempt from being considered as assets. Also, it is my understanding that a borrower may choose to voluntarily provide (or not) all members of the household incomes for the process of HAMP or HARP program. In contrast, while it is my understanding that all persons listed on the note must provide the required financial information to participate. What if the note simply states “Joe Shmoe a married man” is the spouse, who is unnamed considered “on the note?” therefore their income is required? Thanks for all of your posts.

08-01-2009, 09:55 AM	#12 (permalink)
miked2023 Senior Member Join Date: Mar 2009 Posts: 48 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 I'm 60 days late and am ready to go to CW/BofA and propose a loan mod. My question is, where do I start? Loss mitigation? Call them up? I've got my hardship and financials all together so I guess I'm not sure what the first, best step is. I'm going to propose a settlement on the 2nd and a 30 or 40 year fixed on the first. Also, I would like the first to be a step ladder so I can do some much needed work on the house with the extra money. Should I mention this as the reason why or just propose it straight out? What do people start at with step ladders? 2/3/4.5 ? Something like that? Thanks.

08-04-2009, 12:13 PM	#13 (permalink)
wattsm Senior Member Join Date: Jul 2009 Posts: 78 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 I would add to this that anyone looking to deal with BofA should email Barbara Desoer (President of Home Loans) to get the ball rolling. They probably won't respond via email, but you'll get a call within a day or two, and they'll have a written record of your hardship which I feel is important for them to take you seriously. You can contact certain agents directly, and I know quite a few people here have recommended certain people, but I think that just sending the email to Barbara and letting them assign someone to you is the way to go-- you'll probably get someone who actually has the time to deal with your situation. barbara.j.desoer@bankofamerica.com There don't seem to be any Indian agents working out of the presidents office, and they all seem to be top notch people, unlike many of the people working at the official hardship assistance number. The funny thing is, the presidents office doesn't seem to be bothered by people contacting them directly. It's almost as if they have it set up so that people who make the extra effort to do some research and contact them directly are rewarded with competent agents, as opposed to the many people who will just call the number given on the BofA website. One final suggestion-- if dealing with NACA, use their website to make phone appointments in advance. It takes several phone sessions to get your file completed, and you'll end up repeating the same information over and over again. This could take weeks, especially if you're dealing with inexperienced NACA counselors. Make appointments for several consecutive days, even two appointments a day. This will save A LOT of time. One day, I was just finishing up a phone appointment and my cell phone started ringing with my next appointment so I was able to pick right up with the next person. I had NACA call for pre-scheduled appointments after my file was complete, and I just used the appointments to confirm that everything was finished and my file was submitted.

08-14-2009, 06:43 PM	#14 (permalink)
bhuggs Member Join Date: Dec 2008 Posts: 5 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 Is anyone familiar with receiving a phone call for CW/BOA and being told that verbally that they have been approved for a loan modification thru HAMP and was given the trial three months payment and then the payments for the next five years? I have yet to receive any written confirmation but I have been called constantly for the last three months about making a payment but not that payment that was told to me. Should I make the payment? Thank you for the helpful information.

09-04-2009, 02:04 PM	#15 (permalink)
phoenix1979 Member Join Date: Jul 2009 Posts: 14 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 Hi, I beleive you are going through the same thing as I am. Please read my thread: While in Trial Payment I was Declined for BofA Thanks, Pho

11-11-2009, 12:10 PM	#16 (permalink)
snapple candy Senior Member Join Date: Feb 2009 Posts: 1,307 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 I am trying to help a client with former Countrywide now B of A HAMP trial mod. I have determined it is not Fannie Mae and still waiting to see if Freddie Mac. I am still trying to determine who actually is the owner of this CW loan. They definately dont qualify for HARP. minknmelissa posted: "You can get a loan modification through making home affordable program if you are not a fannie or freddie you just can't refi" Just want to be make sure Can you get the HAMP program without it being a Fannie or Freddie loan with B of A/CW loan? Anything else I need to know before I proceed?

11-19-2009, 03:38 PM	#17 (permalink)
klauss54 Senior Member Join Date: Jan 2009 Posts: 75 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 i finally got my fed ex this afternoon have to sign notary and money order for 0.00 must be mailed by 11-25 this is the end of this 16 month journey 2 percent fixed life of loan if it wasnt for this forum and naca i would have lost my house dont give up keep fighting and you will suceed good luck to all of you

11-19-2009, 05:23 PM	#18 (permalink)
breauxjsph Junior Member Join Date: Jan 2009 Posts: 1 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 I need help with my financials. loan was through countrywide now I'm dealing with bank of america, my problem is that before I do the loan modification I'm short $230 per month. customer service keeps telling me that I need to have a surplus of $200 before I get the loan mod. can any give me some advise.

11-19-2009, 07:22 PM	#20 (permalink)
HereinDE Member Join Date: Aug 2009 Posts: 13 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Bank of America Loan Modification 101 That's true. For HAMP, there is no surplus mandate, BUT the problem is that Bank of America doesn't want to give you HAMP modification. I got denied HAMP (2% 5 year interest) recently without any explanation.

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