turned down for loan mod

[raayven420]

i finally got a letter from Ocwen on my loan modification. It was denied because they said my monthly gross income is less than the monthly payments determined by the government guidlines for this program.

So what are the government guidelines for this program?

My interest rate right now is 9.125% because i have a bankruptsy on my record 5 yrs ago, and i can make the payments but I also cant enjoy any of my money I work hard for because all of it goes to this house and the bills.
Should I let them forclose the house(which they will lose) or short sale?
Any ideas what i should do? please help!! julie

[Evan Bedard]

Dasani yes Ocwen is a lender..


Julie, which gov program are you reffering too?

Even though you have been denied once does not mean you cant still achieve a modification, dont give up many here have been denied many times and still fighting and quite often end up achieving their goal. If you are having difficulties on your own I suggest you try going through NACA they have helped many here on the forum:

Here is the link to the site.

https://www.naca.com/index_main.jsp?language=null

[luvmyhorse]

What do you mean your monthly income is less? Did they do the whole formula, reducing interest to 2% and deferring up to 30% of the principal?

And still your monthly gross was too low, or are you talking about something else?

[raayven420]

all it said on my letter was: Thank you for your recent application for modification under making homes affordable program. Based on our review of the documentation you provided you are NOT eligiable for a homes affordable modification because.....
***your gross monthly income is less than the monthly payments determined by the government guidelines for this program.
then it goes on to tell me a bunch of other things i can do

[luvmyhorse]

Are you going to apply again?

[Hopefull2009]

What are the things it tells you you can do?

[raayven420]

my choices that they gave me are:
repayment plan
modification
listing property for sale
deed in lieu of forclosure

im so sick of hearing press 1 for....2 if you want...

ive pressed one choice for a short sale package about 2 weeks ago and still havent recieved it. Im starting to get pissed. im moving to cali to be close to family and dont have time for this. anyone know the number so i can talk to 1. someone thats going to helpful
2. human in the united states
thanks julie

[luvmyhorse]

Do you know that a short sale will damage your credit as much as a forclosure? Did you know that you will have to pay income tax on the difference between what you owe the bank and what you get?

IN my opinion it is better to go backrupt, and wipe out all or your debt in 2-3 years your credit will start to improve. If you just do a short sale, YOU HAVE TO SELL YOUR HOUSE, DEAL WITH THE CRAP, AND STILL HAVE WHATEVER DEBT YOU HAVE. The only one benefiting from the short sale is the buyer and the bank.....

[Mandy]

DO NOT GIVE UP!!!!!!!!!!!!!!!!!!!!!!

DO not accept NO as an answer!!!!!!

Resubmit everything again, work on your financial sheet.

Get help from other institutions!!!!

I would try NACA or HUD..... Don't know where you live, but try them.

WF has denied me many times and I am still on top of them. They probably hate me like crazy, but I do not care!!! I need to save my home.

Contact your politicians, let them know what you are going through.

Good luck.

[luvmyhorse]

i was told by a BOA rep that in order to apply for the modification, I first have to pay the 400 and apply for a refinance and get officially rejected. This will kill my credit and cost me another 400 bucks I don't have. I already know I don't qualify for a refi, even their reps told me don't bother you don't qualify.

Has any one successfully gotten a mod without first applying for a refinance?

[priscilla]

Iluvmyhorse,
BoA reps more than half of the time do not know what they are talking about. This is my opinion though. I have never heard of anything like being denied for refi before getting a mod. Good luck to you and please keep fighting.

Julie,
I was denied by BoA and that letter you got appears to be a generic letter that all the banks send to all of us. I would not give up and keep fighting. I am still trying to get a mod even after the denial. I am working through Naca so I will highly recommend them. But on the other hand, if you do not ike the house, hey let it go. This whole situation is so stressful regardless which route you decide to take. it seems like walking away appears to be the easiest thing. Fighting for a mod is also stressful and one must really want the house to keep fighting for it. I wish you good luck.

[OCNanis1]

luvmyhorse- First of all, congratulations are in order. You have been able to keep current with a $2500 payment after having only grossed 42K. What an accomplishment although not achieved with out sacrifice.

I have spent countless hours scanning all the different threads in realtion to NACA, B of A, Freddie Mac loans, etc. I have to say that I too think you should contact NACA. It seems that working with them does help in providing some protection as far as the speed of foreclosure goes. Personally when I mentioned to B of A I was working with NACA they have left me alone for the most part. I have not paid since 10/08 on my Freddie Mac loan & am still not in foreclosure. I am hoping to have a submission on behalf of NACA soon when I too will start e-mailing the contacts at B of A.

Don't give up as you have already come this far. This site provides an awesome support system with endless advice & encouragement. Just don't give up. We will all get through this together.

[luvmyhorse]

OCNan when I went to the NACA site they asked for my social, so I got a creepy feeling... just to get an appointment with someone? Did I go to the wrong place? Should I just call to talk to someone? Do they report to FICA that you are using them. Believe it or not I still have good credit. If I CAN get out of this without destroying my credit I want to.

I absolutely don't want to destroy my credit by going to NACA and then NOT GET THE MOD.

I keep trying to figure out how much net they are going to say I need to approve me? My principal is 383,000. Does any one have an idea of how I can do that?

IS there a magic formula?

[Riley18]

Originally Posted by luvmyhorse

i was told by a BOA rep that in order to apply for the modification, I first have to pay the 400 and apply for a refinance and get officially rejected. This will kill my credit and cost me another 400 bucks I don't have. I already know I don't qualify for a refi, even their reps told me don't bother you don't qualify.

Has any one successfully gotten a mod without first applying for a refinance?

You post is the first one I have read that is identical to mine. BofA told me I have to be turned down for refinance first. They would not let me apply for refinance when I tried. They told me my house was more than 105% Loan to Value, and now the law changed to 125% LV which makes it more likely to qualify. Problem now is that the bank still won't let me apply. I emailed Barbara's office and was told to "wait until early September" because they had to get everything in place.
I think I finally almost understand what they are talking about with getting turned down for a refinance. I THINK they are referring to a Making Homes Affordable REFINANCE which is different from a modification. I have asked about the $400 and plan on calling Freddie Mac on Monday to ask them. I saw nothing about an application fee on the HASP site. I think it is just BofA squeezing more $ out of us. The refinance through HASP is the plan where the mortgage payment including insurance, taxes, and any homeowner's association fees will be 31% of gross income initially (5 years) and there is also $1,000 applied to principal for the first five years as the mtg. is paid on time.
My mortgage payment is currently $2,520 per month which is 48% of my monthly gross income. I have an appointment with NACA for tomorrow, and I share your concerns with putting social security numbers on their website. I almost didn't complete the worksheet on their site, but I don't think you can make an appointment until the info is submitted. I figured that at this point any help I can get is worth a try.

[so-cal-gal]

Originally Posted by Riley18

You post is the first one I have read that is identical to mine. BofA told me I have to be turned down for refinance first. They would not let me apply for refinance when I tried. They told me my house was more than 105% Loan to Value, and now the law changed to 125% LV which makes it more likely to qualify. Problem now is that the bank still won't let me apply. I emailed Barbara's office and was told to "wait until early September" because they had to get everything in place.
I think I finally almost understand what they are talking about with getting turned down for a refinance. I THINK they are referring to a Making Homes Affordable REFINANCE which is different from a modification. I have asked about the $400 and plan on calling Freddie Mac on Monday to ask them. I saw nothing about an application fee on the HASP site. I think it is just BofA squeezing more $ out of us. The refinance through HASP is the plan where the mortgage payment including insurance, taxes, and any homeowner's association fees will be 31% of gross income initially (5 years) and there is also $1,000 applied to principal for the first five years as the mtg. is paid on time.
My mortgage payment is currently $2,520 per month which is 48% of my monthly gross income. I have an appointment with NACA for tomorrow, and I share your concerns with putting social security numbers on their website. I almost didn't complete the worksheet on their site, but I don't think you can make an appointment until the info is submitted. I figured that at this point any help I can get is worth a try.

Well the BofA reps that told you to apply for a REFI and waste your money are full of HOG WASH.

Try again, speak to a supervisor or else go to NACA. Also, if the person you are assigned to with NACA does not speak sufficient english for you to understand them, request a different person.

[OCNanis1]

luvmyhorse- I know what you mean about being freaked out about the SSN with ID theft & all. If you prefer to call to be safe then do so but contact them as soon as possible. KEEP NOTES! Names, dates, details. Keep it in a binder. Believe me it will help.

I don't know if they report to FICA.

Trying to get through this with the best credit possible is ideal but realistically, something has to give. Just stay focused & strong.

When I spoke to a NACA rep on 07/29/09, he explained that they minus your monthly expenses (you have to account for everything) from your monthly net. In addition they minus $200.00 for cushion, any car payments & other payments you owe for a LOC or CC to your bank so that you don't risk getting your checking account closed (All other CC debt is NOT included). This will demonstrate whether or not you are able to make your current payment under your current terms therefore justifying the need to use the Obama plan.

What the rep explained was that 31% of your gross is what the Obama plan calls for but it is a hard sell to the lender since it can be a big difference from your current payment under your current terms.

In my case it would be $1130 PITI vs. $2274.

Hope that helps. I will keep you posted.

[Lhuynh]

Originally Posted by luvmyhorse

Do you know that a short sale will damage your credit as much as a forclosure? Did you know that you will have to pay income tax on the difference between what you owe the bank and what you get?

IN my opinion it is better to go backrupt, and wipe out all or your debt in 2-3 years your credit will start to improve. If you just do a short sale, YOU HAVE TO SELL YOUR HOUSE, DEAL WITH THE CRAP, AND STILL HAVE WHATEVER DEBT YOU HAVE. The only one benefiting from the short sale is the buyer and the bank.....

short sale does not damage your credit as bad as foreclosure.If you do decide to do a short sale I'm sure any agency would do it if your home value is good enough for them to spend time since they would be making money from it. If your loan and value is not too much of a difference, there might be a chance the bank would just take the loss. Bank rather let you short sale than put you in foreclosure because they would have to spend more effort and money to sell the house. Also, they rather help you do a loan modification thus the fact that they are able to still make money off you. Think about it this way would you rather modify someone's mortgage to get paid 1000 rather than 0 if they were not to be modify, if you were the bank.

[Lhuynh]

Originally Posted by OCNanis1

What the rep explained was that 31% of your gross is what the Obama plan calls for but it is a hard sell to the lender since it can be a big difference from your current payment under your current terms.

In my case it would be $1130 PITI vs. $2274.

Hope that helps. I will keep you posted.

Of course it'll be hard to sell the lender to a 31%. The lender would most likely not give 31% if they are able to make someone satisfy with a 34% - 38%. Think like the bank, if you were them would you help someone to lower it to 31% or would you lower it to 36% knowing they would be satisfy with that. Let's say you are at 6.25% they would try to put you around 4.5% or whatever even if you were FHA you can go as low as 2%, why would they want to put you at 2% if the borrower would be satisfy with a 4.5%. Banks are banks they are in it for themselves not us borrowers.

[OCNanis1]

I called BofA today in regards to that FedEx letter I received yesterday. They took note of my Monthly gross & net income & my monthly expenses. After deduction the expenses from my gross I still had more than the 31% available which is what the amount I believe they will consider for a new monthly amount (31%+). The rep told me I should receive a letter within 2 weeks.

I contacted another HUD agency to ask about so the holder of a 2nd being able to foreclose although the 1st hasn't filed yet & they stated that more than likely the 2nd will press for the 1st to foreclose. In my case, my 2nd is telling my I have to bring my account current in order to submit my application for modification which can take 30 days but in the event it takes longer I would need to maintain the account current.

Just keeping you posted.

[mojamz]

I am with BofA and was told the same thing about qualifying for a refi before I could apply for the modification under the Obama plan. Frustrated since July 2008, I contacted Barbara Desoer and received a letter to provide financials. I owe 270,000. Homes in my area are selling for 130,000. I am upside down with a reduction to income. My mortgage payment is 1952.87 and my minimum on cc's is around 460.00. Gross income is 4240.00. I have late fees added every month and will miss payments if I can not get a loan mod. Of course I understand when they factor front end dti and back end dti utilities and other expenses as such are not considered when factoring. Reading a lot of the threads makes me nervous that I will be denied as well. I have to fax financials so any advice on how to factor a budget will be helpful>

[mojamz]

OCNsnis1,
Did you have a surplus after all financials were complete?

[OCNanis1]

After deduction the expenses from my gross I still had more than the 31% available which is what the amount I believe they will consider for a new monthly amount (31%+).

I actually live paycheck to paycheck. I am really upset right now as I still as of today have not received a return call from NACA in regards to the countless e-mails, phone messages left & Mr. Kevin never e-mailed me as he promised the paperwork I needed for tomorrow's appointment. I am sick with worry.

[luvmyhorse]

BOA told me today that they pre qualify you only based on one month's pay. Even though I am a realtor and work on commission. I don't know if this is some kind of ploy or distraction. One month I might make 8,000 and the next nothing. She said they won't average the months or go by a yearly amount, only the monthly, so I should pick the right month to apply...
DOES THIS MAKE SENSE?

[Hopefull2009]

BOA told me today that they pre qualify you only based on one month's pay.

I think the keyword here is PREQUALIFY you. That's just to put you into the trial period. Once they receive documented pay information, they do look at YTD earnings (this is why paystubs must include this info) along with your most recent tax return.

[Lhuynh]

Originally Posted by luvmyhorse

BOA told me today that they pre qualify you only based on one month's pay. Even though I am a realtor and work on commission. I don't know if this is some kind of ploy or distraction. One month I might make 8,000 and the next nothing. She said they won't average the months or go by a yearly amount, only the monthly, so I should pick the right month to apply...
DOES THIS MAKE SENSE?

I do loan modification, from what I know, we pre qualify our clients on their month's pay but we send in the last 2-3 months paycheck because every month might not be the same. So, if my clients we're to work overtime I would tell them not too, sure they will suffer but it'll help them more with their mortgage.

Banks will ask you to fill out an Internal Application Form. Which is like everything you own and just a whole lot of crap. Depending how you fill out that form that is how you get rejected or not. Let's say you already paid off a car, you do not need to put that on their, because when they run your credit, that car will not show. Get it?..Also, you show them that you are using too much money on EXPENSES, they will deny you and say stop spending too much and pay your mortgage instead.

From what I know they do not look at your credit when doing a loan modification, however they will run your credit. Realize whats more important your credit or your home? WHAT WOULD YOU RATHER HAVE? I see people talking about their credit, but is credit really going to let you stay in your house?

Banks are trying to avoid, and prolong everything as long as they can. From my knowledge November 30th that is when the Obama's Plan is at its end.