Bank of America/CountryWide employees have stated that
MOST if not ALL '
AG mods'
are canceled after the
NOTARIZED FINAL
mod contract package has been returned in compliance with the instructions.
BEWARE:
You will NOT be told of the 'cancellation' until it suits CW/BofA. So far, as much as a 7 month delay from the date the contract was to take effect until the borrower was 'told' has been reported, meaning that 6 months of payments were 'accepted' per that 'agreement'. Some of the 'March batch' are just coming to light NOW! You will have NO feadback from them, nor any request from them to explain any discrepancies THEY may claim. A further frustrating fact: THEY WILL HAVE DINGED YOUR CREDIT, either reporting that payments were not made or that they are partial payments.
To recognise whether YOU have an 'AG mod', ONE aspect identifies it:
A STREAMLINED application taken ONLY by PHONE to be followed by the borrower faxing them only a hardship letter. NOTHING MORE. NO FINANCIALS. The very next contact from
CW is by phone and indicates that you are getting a modification package.
Other criteria is that your loan was issued from Jan 2003 to Dec 2007 and was 1) an ARM, 2) a Pay Option ARM or 3) a subprime first mortgage.
CountryWide NEVER provides a copy of the verbally-provided application information for you to verify THEIR entries of YOUR information.
The LETTER accompanying the modification contract has a FOOTNOTE that states "Your eligibility is based upon information you provided to us and may be subject to validation." On the third page of the 'letter' in the 'IMPORTANT TERMS' is listed the following:
"Please note that this offer is contingent upon verification of your income. Even if you sign and return the loan modification documents;
this modificaiton will not take effect if we are not able to verify your income."
Verification of income normally PRESUMES an HONEST ATTEMPT to verify the income, not the CW-deny-em-automatically-cause-we-didn't-even-try-routine.
Given that CW was DENYING the contracts AFTER they had been notarized by the borrower, COUNTRYWIDE/BofA should be required to make EVERY EFFORT to ACCOMODATE the Borrower in determining the income, not the practice in evidence of their overhelming attempt to disqualify ALL CW CA AG mod contracts.
The letter instructed you to return either paystubs and 3 months of bank statements OR, if self-employed, just 3 months of bank statements.
Then you enter into the
CW/BofA game of 'what reason do we use to deny this AG mod'. It is also a game of "How long do we take the smaller payments and mess up the credit reports before we send the letter demanding the 'unpaid balance' that has now been increased by the false modification contract"?
They will intentionally put borrowers off for as many as 6 months of the 'false' payments, even with the borrower repeatedly requesting a
CW-signed copy of the contract. Prior to making your first modified payment, you are given multiple verbal assurances that the 'mod' is approved. You may even be told a date that they completed 'Verification' of the package contents as I was.
If you DO become aware of some problem, very frequently you are told they will 'escalate' your mod. Well sources inside say that even when it is escalated to 'managment', that these will remain cancelled because those 'AG mods can be denied after they are approved and most are' or that they were 'contingent' modification contracts.
Reasons I have heard for the contract to not be honored or implemented (and most borrowers hear more than one of these 'reasons'):
1) The income did not match (even for employees who had NO change of ANY type)
2) It didn't get linked with the government funds we were using
3) The investor funds never came thru
4) We made a math error
5) It got here to late (supervisor's SUGGESTED that answer without looking at the particular caller's info on the screen when the call center personnel could not determine what excuse to give)
6) No reason
7) Those AG mods were conditional contracts (The only condition was in the letter, not the contract.)
They are now claiming that most of the cancellations are due to 'income verification'. It is very interesting that this was claimed even on an application where NO changes of income occured AT ALL. That was a case of an employee. The case for self-employed borrowers is far worse. IF you are going to try matching reported income for self-employed people to a bank statement rather than a profit and loss statement, you will ALWAYS have a way to say the 'income' differs.
The verbal application should then have been transcribed into a final application that the borrower could update or correct and then sign and included in the final package, as is done for an original mortgage application.
The only FAIR way to be verifying income for anyone self-employed would be to ask for a profit and loss statement or a copy of any contracts that provide monthly income or any other form of receipts the business has that show income.
Comparison of BANK STATEMENTS covering months you were TOLD not to make the scheduled mortgage payments to the contents THEY transcribed from your phone interview/application is a process that is RIPE for EXPLOITATION as is evidenced by the overwhelming number of these mods that are being denied after the fact.
What of ANY attempt to contact the borrower? They obviously wanted to just deny the mods, not allow any FAIR AND REASONABLE contact with the borrower to request any explanation. This is NOT standard business practice. I suspect there is even at least one standard for lending that was not adhered to with this practice. Where is a good attorney?
BofA/
CW should have been REQUIRED to give each borrower an opportunity to either explain what BofA/
CW viewed as either a difference from the application OR provide additional documentation. NO SUCH effort was made.
If BofA/
CW could not verifiy income thru the bank statements or believed a difference to exist between the application and what they extracted from the bank statements, they should have been REQURED to give the borrower an OPPORTUNITY to provide additional documentation or an explanation. AGAIN NO SUCH EFFORT WAS MADE TO THOUSANDS OF BORROWERS WHO
CW ENCOURAGED TO APPLY FOR THIS MODIFICATION CONTRACT.
A practice of never contacting the borrower for an explanation of the difference or an opportunity to provide additional proof of income provides
CW/BofA with a loop-hole worse that any I've encountered when applying for a $500-limit CREDIT CARD.
With
CW controlling the application AND able to modify same without the knowledge of the borrower, AND the borrower NEVER contacted to resolve any discrepancy of verbally reported income versus the income
CW 'determines' per the bank statements, AND
CW concealing their supposed 'finding' for MONTHS in many cases, is it hard to see that
CW is INTENTIONALLY both DENYING EVERY AG MOD AND INTENTIONALLY DELAYING telling the borrower? It appears the delay goes on until the 'difference' is at least $10K that they suddenly demanding payment for in 'arrearages'.
IF you are really unlucky with their game, your note is one they choose to transfer one month AFTER your contract was to take effect. This is the very day your first modified payment is due. Only the new servicer will refuse to accept the modified payment and will be 'in on the game', demanding the total unpaid payments (oh yeah, that minimum of 2 months that they told you not to pay during the supposed implementation of the mod contract plus the time you had to be in arrears to trigger the AG settlement mod).
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Countrywide California Attorney General Settlement - BEWARE of CW Cancelling Loan Modifications WITHOUT Notice 
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