Modification rejected so hired lawyer

[Schnelle]

I cannot be thankful enough to have found this forum. I will begin sharing the progress of my loan modification process in this thread.

I will begin by providing basic facts about my Countrywide mortgage:
Date loan acquired: August 2005
80-20 Interest Only Loan
1^st loan – 220,000 at 6% Fixed for 10 years
2^nd loan (HELOC) – 65,000 adjustable rate
Status: Current

Since our mortgage was acquired our net cash flow immediately fell to the negative; we clearly should have not been approved for a mortgage in the first place. I honestly stated our income on the application but the lender inflated our income to qualify us. We stayed current to date by slowly dipping into our HELOC and savings.

I first contacted CW regarding loan modification on April 2008 when my husband took a pay cut ($1,000 gross reduction on his monthly salary); the pay cut accelerated the depletion of our savings.

Result: Rejected due to overly negative net cash flow. I was advised to cut back on spending and find a second job.

On June 2008 my husband found a job that restored his original salary however with that income we still have a negative cash flow (-$300 a month); with our home equity available credit shut down and savings dried up we are out of resources to cover the difference. So for the second time I contacted CW on Dec 2008.

Result: Rejected due to being current and not flagged

A week ago my husband and I decided to hire a lawyer, thanks to this website we felt confident enough to use the services of Griswold & Agdeppa. So far I was pleased with their constant follow up. The mortgage investigator that helped me said that he feels confident that we will have a successful modification. Below is the proposed modification:

1) 1^st Loan - 4% fixed for 30 years
2^nd Loan – 5% fixed for 30 years

OR

2) 1^st Loan - 4% fixed for 5 years (Interest Only)
2^nd Loan – 5% fixed for 5 years (Interest Only)

Both will bring my net cash flow to a positive.


I was informed by the mortgage investigator that once the modification process begins, payments will be placed on hold; I would not have to make mortgage payments until the modification is complete. Can anyone confirm this?

I have submitted all the requested documents and all I could do now is wait and see.

[Schnelle]

Has anyone here had a successful loan modification with a 20-80 interest only mortgage while staying current?

I would appreciate any feedback!

[downandout]

Schnelle,
I have contacted them as well. I have not yet decided to hire them. I am checking other options. I am curious to see your results.

[Schnelle]

Downandout,

The investigator told me that the modification process could take between 30-60 days and in some cases up to 90 days.

I will keep you updated.

[JBURT]

WE HIRED THE FIRST ATTORNEY ADVERTISED ON LOAN SAFE SITE PAIVAS OFFICE BACK IN JUNE OF 08. AS OF DEC OF O8
OUR PROPOSAL HAD NOT BEEN SUBMITTED. MOST OF OUR
E-MAIL CORRESPONDANCE COME FROM LOAN SAFE STAFF
NOT FROM PAIVAS STAFF IM A LITTLE PUZZELED ABOUT THAT.

HOWEVER WE RECEIVED THE C.W. DEC PROGRAM NEW TERMS
BEFORE CHRISTMAS IT WAS A LOWER INTEREST RATE BUT
PUT ALL THE UNPAID INTEREST ON THE LOAN BALANCE
IT WOULD PUT US IN WORSE SHAPE 5 YEARS FROM NOW.

AS I UNDERSTAND OUR PACKAGE HAS BEEN SUBMITTED
TO C.W. BUT I WAS NEVER ADVISED TO WHAT THE PROPOSED
TERMS WERE BEING REQUESTED ON OUR BEHALF.

ACCORDING TO ATTORNEYS OFFICE AND LOAN REVIEW WE HAD LOTS OF LOAN VIOLATIONS I HOPE THEY CAN USE THE
VIOLATIONS TO GET REASONABLE TERMS. STILL WAITING

[Moe Bedard]

JBURT



Can you please take off the caps lock when posting.........
thank you

[gray517]

jburt
any type of modification that you get regardless of who or how you get it will tack on the past due interest to the loan balance, that is the only option with that. I have not seen any mods on any forums where lenders are reducing the balance or principal on any modifications.

[LHarveyMadman]

Schnelle, I saw your message directed to me in another thread, but I'm replying here since this thread "belongs" to you.

As you have gathered, I got a mod from B of A while current on my payments. I knew when I inquired about a mod, I would probably have trouble getting someone's attention because my situation clearly was not as dire as others.

In a nutshell, I explained my reasons for seeking a modification: to get our from under an ARM, start paying down principal (original loan was interest-only), unable to refinance due to lack of equity. I acknowledged that I wasn't in hardship now, but could be facing a problem in the future when my interest rate resets and I have to start making principal payments amortized over a shorter term. I made a concrete proposal for a modification, and demonstrated that I would be able to make the payments with these new terms.

In support of my request, I highlighted my creditworthiness (I have a FICO score that has been consistently in the high 700s to 800s range), indicating that I have a history of making good on my debts. I appealed to their fiscal sense, but noting the value of a fixed-rate loan on the secondary mortgage market (i.e. a new loan would be attractive to investors). I also told a little about my family and me, and tried to show that we are decent folk who deserve consideration. I know many people will say that these sort of personal stories don't matter, but I think they can't hurt. For the record, the analyst who called mentioned some of these details. So, I like to think that it made a difference.

So it is possible to get a modification without being late, but the situation has be right. I think the biggest hurdle you are facing is that you have a negative cash flow, and your lender probably has determined that even with a modification it would be difficult for you to afford the payments.

[Schnelle]

LHarveyMadman,

Thank you for your very informative and coherent feedback.

A modification of my loan to:
1^st loan: 4% for 30 years (principal and interest)
2^nd loan: 5% for 30 years (principal and interest)

will bring my net cash flow of 170 a month. I am very confident that with these terms, my husband and I will be able to maintain our payments. Our income is also expected to increase once I graduate this coming May.

My husband and I have maintained excellent credit rating currently above 760 all these years. It will be a shame to loose our good credit rating only because we could not refinance due to lack of equity in our home.

I will be revising my letter to Countrywide taking into account all your suggestions. Thank you so much for taking the time to respond.

[surfdoggy1234]

Do any of you know if CW will modifiy the interest rate on a $287k 2nd with a Fixed Interest rate? I just spoke with their Home Retention and she said they don't modify the rate for fixed rated 2nds. Note that my first is with AHMSI. Any thoughts?

[Schnelle]

Update:

Jan. 8, 2009 (Thursday)

- All requested documents received by law office:

1.Signed Copy of the Financial Budget Worksheet
2.Copy of 30 day pay stubs (most recent)
3.Copy of 2007 W-2
4. Copy of your 1^st and 2^nd Mortgage Coupons
5. Tax Return (2006 and 2007)
6. Written Fee Agreement
7. Third-Party Authorization and Limited Power of Attorney
8. Payment Authorization
9. Signed Hardship Letter (and supporting documents)
10. Bank Statements (Nov. and Dec.)
11. Loan Documents

Jan. 13, 2009 (Tuesday)

- Got a call requesting signature for a revised Third-Party Authorization and Limited Power of Attorney to include Loan Safe Solutions (in addition to the law firm) to contact the lender on my behalf.

- Document submitted.

[Schnelle]

Update:

Jan. 13, 2009 (Tuesday)

- Got email confirmation that the revised Third-Party Authorization and Limited Power of Attorney was received and given to the processor.

[downandout]

Schnelle,
I am curious to see the out come thanks for the update. You said you were rejected the modification through Countrywide did they give you a reason?

[Schnelle]

downandout,

I contacted them twice.

The first time I was rejected was due to overly negative net cash flow (around negative 1,300). This was when my husband took a 20% pay cute; I was advised to cut back on spending and find a second job.

The second time around I was rejected due to being current and not flagged. At this time my husband finally got a new job restoring his original salary, bringing net cash flow to negative 300.

[Schnelle]

Update:

Jan 16, 2008

I just got a phone call from a forensic loan auditor; she asked me some questions regarding my loan transaction.

Some of the questions asked:
1. Was the income stated on the application form accurate?
2. Did I go through a broker or a lender?
3. Was there a notary present at the time the documents was signed.
4. Did we get a copy of good faith estimate 3 days prior to the signing of loan documents.

The auditor said that she will be completing the forensic loan audit of my loan documents within 24 hours and will be forwarding it to the lawyer.

[newjersey24]

Hey Schnelle,

The statement you made before:

"I was informed by the mortgage investigator that once the modification process begins, payments will be placed on hold; I would not have to make mortgage payments until the modification is complete. Can anyone confirm this?"


Were you able to confirm it? I dont think it would be recommended, the lender will still want their money even during the process.

Let me know if you got an answer, I am still making payment, albeit late, but still am.

oh by the way, GREAT THREAD!!!

I'll be dropping by daily.

[Schnelle]

newjersey24,

I have not gotten a confirmation from another reliable source.

From the thread below a member (elpjohnson) did say that she was able to skip a full months payment without affecting his credit.

Just hired J. Griswold Law to handle Loan Mod w/ CW

[Schnelle]

newjersey24,

In regards to skipping payment -- it begins from the time Countrywide reviews the modification package; once the review begins, the ability to make your payments online is disabled.

This was based on the information provided to me by my mortgage investigator from law office.

Since your servicer is WaMu, I would suggest inquiring about it with them.

[newjersey24]

Schnelle,

You on to something! I too noticed I cant make payment online for my mortgage typically. Its say online is not allowed on my account and to call some customer service number.

Very Interesting.... I will try to call my MI and WAMU to see.

This will help greatly, if I could till I get an offer/rejection. I just dont want to hurt my credit score which I worked so hard to improve, so I can refinance to a great rate and among other things.

But I will definately take a look and let you know what I found out.

Originally Posted by Schnelle

newjersey24,

In regards to skipping payment -- it begins from the time Countrywide reviews the modification package; once the review begins, the ability to make your payments online is disabled.

This was based on the information provided to me by my mortgage investigator from law office.

Since your servicer is WaMu, I would suggest inquiring about it with them.

[Schnelle]

Update:

Jan 19, 2009 (Monday)

I sent an email a few minutes ago requesting for an update on my forensic loan audit; I just got a reply informing me that the audit will be completed by the end of the today's business day.

[Schnelle]

Update:

Jan 19, 2009 (Monday)

I just got an email from Evan of processing dept confirming that my modification package has been sent to Countrywide on the 13th and that I should have a negotiator from Countrywide assigned to my file any day.

He also requested to submit most current pay stubs and bank statements as I get them.

[newjersey24]

Schenelle,

I spoke with my Mortgage Investigator he advice I should continue to make payments if I can.

Maybe I have to wait till my consultation with my lawyer. I dont know.

Did you talk to your mortgage company about account being frozen?


Maybe *** know something about it...

[Schnelle]

I would like to post the names of the people from Loan Safe Solutions / Griswold & Agdeppa that have efficiently helped me through this process to date.

Kevin Noyes – Mortgage Investigator
kevinn@modifyloan.net

Ellie Lockerby – Quality Control Specialist
Ellie@modifyloan.net

Edna Martinez – Auditing Manager
edna@loansafesolutions.com

Andrew Panessa – Processor
Andrew@loansafe.org

Stephene Moran – Processing Dept.
stephene@loansafesolutions.com

Evan Bedard – Processing Dept.
evan@loansafesolutions.com

Maria Vazquez – Forensic Loan Auditor
Maria@loansafesolutions.com


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[Schnelle]

Update:

Jan. 20, 2009

- Most recent pay stub and bank statement submitted.

- Received my forensic loan audit. Below are the main violations found:

1. The finance charge is $459,794.21. The disclosed finance charge of $304,486.20 is not considered accurate because it is understated by more than $100.

2. The APR is 7.804%. The disclosed APR of 6.242% is not considered accurate because is more than 1/8 if 1 percent point above or below the APR as determined in accordance with actuarial method.

3. Loan applications in file are not signed or dated by customer or loan officer.

Question: Anyone here has a copy of their original signed loan documents?

4. Good Faith Estimate in file prepared by Countrywide, dated 06/15/2005 is not signed or dated by customer.

[Schnelle]

Update:

Jan. 21, 2009

- I revised my hardship letter and submitted it

- Called Countrywide to confirm that my modification package has been received; I was informed that only 3 documents were received which worried me:

1. Cover Letter
2. Third-Party Authorization
3. QWR

I spoke with Andrew Panessa (Processor) to inquire about this. He assured me that all my documents have been submitted to a Countrywide negotiator named Nancy; and that by Friday all of the documents should reflect on my Countrywide account.

I learned that Loan Safe Solutions uses a specific negotiator from Countrywide to handle all their cases.

Andrew was very pleasant to speak with; it appears that he is on top of my case which was comforting.