I Don't Know What I should do...Please HELP! Loan with Wells Fargo!

[Kelly712]

Here's the confusing and horrible situation...We have a mortgage, interest only loan with Wells Fargo. We live in California. It's IO until fall of 2010. We owe $496,000. Everything was going well until my husband got laid off. His last day of work is this Friday, Feb. 27th. His company who he worked with for 9 years will only give him maybe a 3 week severance (it hasn't been quite determined and he may not even get that!) Our family of four, including a toddler and a 7 month old baby, live on his one paycheck. I do some odd jobs from home, but nothing substantial. I am mostly a stay-at-home mom. We just can't afford to pay our next month's mortgage and have enough money to live on. I'm confident my husband will get another job, but whose to say he'll make the same and plus everyone else is competing for the same jobs. It might take a long time to get another job. He's in construction...ouch...one of the industries hit really hard.
Here's where it gets the most confusing. I get so much conflicting information, my head could just spin right off. I was told by a loan modification person that in order to do a loan mod, I should not tell my lender that my husband was laid off because they will never approve of one, especially Wells because they are the worst to work with. But then I read that if I tell them, they will be able to adjust the loan according to our new income, which will literally be nothing except for unemployment, and it shows a real hardship. I called Wells Fargo to get the information and the very dry representative told me to send a hardship letter, etc...I wrote the letter, but I am really stuck and I need to get this info out so I can get the process going. The lady told me that it can take 60 days!!!!! What do I do during this time????? Do I tell about the layoff? What do I do about the mortgage payment, do I not pay my mortgage? Do I scrounge my pennies and have no food on the table just so I don't accrue penalties??? When I called Wells Fargo in January, (we were afraid of a possible lay off), they told me that since I'm current, I shouldn't pursue a loan mod. I was told that it hurts my credit and my house becomes HUD. She told me many more negatives that scared me, so I put it on hold. Now reality hits and the lay off is confirmed.
Another thing I'm confused about is do I hire a loan mod person, or save money and do it myself? Again, we really have no money to even hire a loan mod person. I heard that if I do it myself, nothing will happen or I will get bad results. Is this true, or do the loan mod people, who are getting paid, use this as a tactic to get business?
Sorry if I'm jumping around, but that's how confusing it is in my head. I really don't know what to do, who to trust, or where to turn to. I can call counselors, but all the people I talk to about this makes it more confusing for me because everyone tells me different.
Any comments or advice would greatly be appreciated. Thank you!

[Dan Bailey]

Kelly,
Glad you found the forum and posted. Take a deep breath.....Many of the things you "heard" are just smoke.

pursuing a modification does not hurt your credit.Your home does not become HUD.

Watch out for what "loan modification" companies tell you....they are as plentiful now as there are out of work mortgage brokers.

Yes, the process to receive a modification takes time. It is not an overnight thing. It hurts to know that when things are bad...but it is a process. Thousands of us are going through it, just in this forum alone.

You can do it yourself, hire a qualified attorney, or use NACA (if this is the only propeerty you own) The process can take even longer than 60 days using any of these alternatives.

Send your hardship letter. That will serve as notification to the lender that you are requesting help and that you are going to be having trouble paying the mortgage.

Make a decision, based on your financial status, and time investment willingness, of how you will approach getting a modification. Yourself/lawyer/NACA

If you decide to pay a lawyer, check your local BAR association for qualified attorneys...the home page of the forum here also has recomendations of verified attorneys.

Check out NACA: https://www.naca.com/refinance/refinanceSubmission.jsp They are a non profit homeowner advocacy group that many members here have decided to use.

Stay away from any "loan mod" companies that approach you..they are vultures.

breathe!!

This will take time, and your credit may get hurt by missed payments....but your home is important. Take one step at a time and follow the process.

Hang in there and good luck...let us know whats happening.

[Kelly712]

Thanks Dan. I want to send my letter ASAP, but I'm having trouble with whether to disclose a lay off. Technically my husband is still employed. Soon though when they ask for updated info, he may not be. I can't foresee the future. In addition, how do I know what debt to income ratio they are looking for in order to qualify for a loan mod. I read that it's a science. You don't want to show too much hardship, as to be a risk for default, and you don't want to show that you're too stable then they think everything is fine. That's what I'm having the most difficult time with.

[Dan Bailey]

Kelly,

Send in your hardship letter first. Heres an example:Examples of a Hardship Letter

They will contact you with what information they need from there.(financials, etc)

Due to the many varying circumstances , servicers-the lenders that determine the financial criteria according to whatever plan they have for each differing circumstance, etc....it is immpossible to give you a magic formula. It is more voodoo than science. That is why no-one here can be liable to say :"say you make x-amount, owe x amount, etc..."

Take the first step by sending the hardship letter, decide whether or not to seek outside help from NACA or an attorney, then, when you receive the information request packet, fill it out according to what is asked.

[Kelly712]

I spoke with Wells and they require 3 documents to get things started. Hardship letter, financial report for one month, and pay stubs for previous 30 days. I sent all of it over this morning via fax and I mailed it. I feel a little better that I at least initiated it. We'll see what happens...(The person I spoke with at Wells said the same results will occur if I did it myself or had a 3rd party representative. Basically all the 3rd party is doing is directly sending the letter and other docs to the loan processing department, but the results are the same.) Of course I asked for their lender investor guidelines and she of course said they don't provide that...it didn't hurt trying...

[edh3018]

Keep us posted on this Kelly, I'm in CA and will be in a very similiar situation as you are right now with the possibilty of a layoff...

[Kelly712]

Here's an update on my situation and I would like to know if this is accurate information my "servicer" is telling me.

I decided to go ahead and proceed with the modification myself. I received an answer and I'm not sure if it's really all they are able to do. I was told that the ONLY thing they can do, since my lender is private and they do not have to follow modification guidelines, is that they can basically make my loan a fixed rate for 40 years at 4.875%. This is if the lender agrees to the terms. (my lender is B of A by the way I discovered...I guess Wells Fargo is only the servicer...) It does not lower my payments or help my hardship situation at all and I was told by Wells that I should go to Help for Homeowners if this does not work with us and in turn make my house HUD.

Is this true information...that they don't have to follow guidelines because my loan is backed by private investors? That this offer is the ONLY thing they can do? That HUD is my only option? Does anyone know about this? Also, I heard that Bank of America might become governed by the feds, so should I wait until that occurs before I proceed with the new terms? If I proceed with the new terms, do I get locked in and then I can't change it in the future if there are new guidelines for B of A? Of course my Wells Fargo "servicer" was not helpful with these questions.

If anyone knows the answer to these questions I would appreciate any information they may have. Thank you!

[Dan Bailey]

Kelly, if those terms do not help your situation, you may try NACA:https://www.naca.com/refinance/refinanceSubmission.jsp
They are a non-profit homeowners advocacy group. Theyve had success when lenders play hardball. Alot of folks on the forum have received help from them, especially after lenders have given non-helpful offers first.

When he said third parties " he meant "loan mod" companies that charge for services. They are mostly scams.

If the terms dont help you, you may want to consider contacting NACA before signing anything.

PS: It does not make your home "HUD"

[HopingtoFind]

Originally Posted by Kelly712

Here's an update on my situation and I would like to know if this is accurate information my "servicer" is telling me.

I decided to go ahead and proceed with the modification myself. I received an answer and I'm not sure if it's really all they are able to do. I was told that the ONLY thing they can do, since my lender is private and they do not have to follow modification guidelines, is that they can basically make my loan a fixed rate for 40 years at 4.875%. This is if the lender agrees to the terms. (my lender is B of A by the way I discovered...I guess Wells Fargo is only the servicer...) It does not lower my payments or help my hardship situation at all and I was told by Wells that I should go to Help for Homeowners if this does not work with us and in turn make my house HUD.

Is this true information...that they don't have to follow guidelines because my loan is backed by private investors? That this offer is the ONLY thing they can do? That HUD is my only option? Does anyone know about this? Also, I heard that Bank of America might become governed by the feds, so should I wait until that occurs before I proceed with the new terms? If I proceed with the new terms, do I get locked in and then I can't change it in the future if there are new guidelines for B of A? Of course my Wells Fargo "servicer" was not helpful with these questions.

If anyone knows the answer to these questions I would appreciate any information they may have. Thank you!

4.875% fixed sounds pretty good to me. What is your current rate? Is your home upside down at this point?

With the new Obama plan they could look at possibly modifying your principal to get you to 31% of your gross income...but it is entirely up to the lender, they do not have to. Have you asked them about this?

[Kelly712]

Well..got the call today and was denied because my investor B of A does not want to change the terms or interest rate. That's the only reason I received. So has anyone had experience with NACA and what is the explanation of their eligibility requirements. They say that you must donate 5 activities a year for them???? That sounds really strange. I've never come across a non-profit agency that requires that...Maybe someone here can clarify and explain that. When you call them, they have a high volume of calls and tell you to call back later...I did talk to a really nice gentleman there today, but he didn't mention the requirements. Also, the intake questionnaire is very personal. I don't feel comfortable disclosing my ssn# online and to ask about dependents and their birthdays...it just seems very strange...

[FLgata]

Originally Posted by Kelly712

Well..got the call today and was denied because my investor B of A does not want to change the terms or interest rate. That's the only reason I received. So has anyone had experience with NACA and what is the explanation of their eligibility requirements. They say that you must donate 5 activities a year for them???? That sounds really strange. I've never come across a non-profit agency that requires that...Maybe someone here can clarify and explain that. When you call them, they have a high volume of calls and tell you to call back later...I did talk to a really nice gentleman there today, but he didn't mention the requirements. Also, the intake questionnaire is very personal. I don't feel comfortable disclosing my ssn# online and to ask about dependents and their birthdays...it just seems very strange...

Good Morning Kelly,

I can tell you that I am TICKLED PINK with what the NACA has done for me. Yesterday morning, I woke up to an email stating that their proposal to Countrywide for a restructured loan has been approved at a 2% interest rate for the life of the loan. This will save me over $1,000.00 a month.

When I had my phone counseling appointment (back in December of 2008), the gentleman simply said that our objective was to figure a new payment that was affordable. I did have to show hardship, but also proove that I could afford the new payment. I know that leaves it wide open, but the NACA representatives will go over all of your financials with you. They really do care about us, and work hard for our best interests.

As for the volunteering...it is requested, but not mandatory. Unfortunately, my nearest office is in Tampa, which is hours away. I will try to help when I can, because I am forever in debt to them, but my contribution will probably be geared towards their New Home Buyers as I own an inspection company.

If you keep reading through the posts, you will see how many members recently got acceptance letters stating that their NACA proposals were approved.

Good Luck and please keep us posted.

[MP927]

Hi Kelly!
Yes volunteering is not mandatory; but after you get into the process and realize NACA is truly fighting on your behalf (for free), it kind of makes you want to give back.
As far as disclosing the personal information, I think the good outweighs the negative and when you look at the big picture, (which is to have an affordable payment), you don't even sweat that small stuff.
I trust NACA with my info but you have to decide for yourself what's going to work for you.
Good Luck!

[itscatnip]

Originally Posted by MP927

Hi Kelly!
Yes volunteering is not mandatory; but after you get into the process and realize NACA is truly fighting on your behalf (for free), it kind of makes you want to give back.
As far as disclosing the personal information, I think the good outweighs the negative and when you look at the big picture, (which is to have an affordable payment), you don't even sweat that small stuff.
I trust NACA with my info but you have to decide for yourself what's going to work for you.
Good Luck!

I plan to volunteer eventhough its not mandatory because i have an overwhelming desire to help NACA in its efforts. I tried for 8 months to get a modification with cw on my own and NOTHING happened until NACA got involved.