New guidelines for HAMP

[Illinois Tinner]

I just got off of the phone with my constituent services assistant that was assigned to me by my local congressperson. She told me the NPV calculator IS available online and sent me links to the new guidlines and the calculator in an email. Unfortunately, I am unable to find the calculator. I tried to call the lady back to get confirmation about this online calculator that she said was available but she was in a meeting and will be calling me back tomorrow. I did however think the new guidlines show an effort to make this program easier, more streamlined, and more transparent.

Here are the links I was given:
http://www.treas.gov/press/releases/reports/modification_program_guidelines.pdf
http://www.freddiemac.com/singlefamily/service/mha_modification.html

On the freddiemac website it shows that yesterday the new guidelines were posted and they are to go into effect on December 1st.

I am still trying to get my loan modified because Chase has told me I do not make enogh money to qualify (according to their private calculations).

I am hopeful I can find a way to do this Net Present Value test on my own to confirm my suspicions that Chase is not doing me justice with my loan modification efforts.

Can anyone help me find a way to do this NPV test on my own?

[heidi79]

there is an npv test on this site for freddie mac programs, do a search and you'll find it, but . . . continue to persevere with her for the link just in case.

[flagirl4444]

So far, the real NPV tests are not available to the public. There are a couple of "mock" tests online, but the real base test is not made public. On top of that, all the major lenders/servicers are allowed to use different variables based on their own data. So you may have the exact same loan scenario as another person with a different servicer, and the outcome could be different.

Can you tell us more info about your income, current PITI, loan amount, interest rate, and other debt?

[ama125]

That is the same link as always for the guidelines, but they must have updated them to include hope for homeowner's and second lien program as they are both mentioned now. As for the NPV test, it is available online to the servicers but not the borrowers. Many of us here have used the FDIC mod-in-a-box NPV test just to see what it looks like and what goes into the calculations. It is not the same as HAMP though but the FDIC was involved in designing the NPV for HAMP so it must be close enough.

[Illinois Tinner]

Originally Posted by heidi79

there is an npv test on this site for freddie mac programs, do a search and you'll find it, but . . . continue to persevere with her for the link just in case.

I have looked for the NPV tests and only found ones that were NOT related to HAMP. Also in case you misunderstood me I do not have a freddiemac mortgage. I started with Chase in 2004 and they stilll hold the note today.

Flagirl4444:
My income is approximately $2,100 a month right now.
My PITI..I was not sure what that was...Had to look it up. My mortgage payment with taxes, insurance, and everything was $1,870 something before I got a very poor loan mod last year that dropped the payment to just over $1,800...(Big drop there lol)
Original loan amount was $210,000 with a 5 7/8 interest rate and my MOD last year dropped the interest to 5 3/8.
We still owe $200,000 on the mortage.
My other debt is small, but I am not making any payments on other debt anyway.

We never got ourselves in deep or stretched ourselves as many others have appeared to do. Our home is a small 2,100 quare foot on less than 1/8 acre that is barely big enough for my me, my wife, and 5 kids. Our taxes are incredibly high at $7,500 a year (And we pay about $200 a pop X 5 kids for school registration on top of that!)
Cars are old and paid for a long time ago. In fact one has a blown engine right now and is sitting in my driveway dead.

Chase told us we were about $700 short to qualify for a MOD, but I know that is NOT TRUE! They are just trying to push us through an inhouse MOD I think.

I have seen the mod-in-a-box tests online and those are not correct, so I have been searching further. I am contacting the treasury department tomorrow since they are the oversight for this HAMP program. I plan on letting them know how I feel.

Here is a link to my original post about my story >> Why is Chase giving me the runaround? They are being nasty to me.

[ama125]

Fannie Mae also updated their servicing guide for HAMP for Fannie loans:
https://www.efanniemae.com/sf/guides.../2009/0931.pdf

[flagirl4444]

Under HAMP guidelines they are not allowed to reduce your payment (PITI) below 31% of your income. They reduce the interest rate and if necessary stretch out the loan term until they hit that 31% target, but they cannot go below 31% of your income, which is $651/month. That is the lowest they are permitted to lower your payment.

Your taxes and insurance alone are over $670 per month, so the amount they would have to lower your payment to would not even cover that, let alone any principal or interest. As a rough estimate, for them to modify there has to be enough payment above and beyond the tax & insurance to cover principal and interest at 2% x 40 years. For a loan amount of $200k, that would be roughly $600. Plus the tax and insurance of $670, means you would have to qualify to make a payment of about $1270.

As you can see, $1270 per month is about 60% of your income and is not affordable. In order to qualify you would need to have an income of at least $4k per month ($1270 is about 31% of $4k). This is just a rough estimate and if your lender is willing to do any principal forbearance the numbers would change a little, but not much. In your current situation a forbearance wouldn't help because they would need to forbear more than 100% of the loan balance, and that is in no way possible.

[heidi79]

flagirl is absolutely right, take a second look at your income and expense information, as it stands now, no way you would qualify.

[ama125]

Just an FYI, they can go below 31%, at least for Fannie Mae, but I haven't seen it reported by anyone...

From Fannie servicing guide:

Q4. Can a loan be modified to a monthly mortgage payment ratio below 31 percent?

Servicers must apply the specified modification steps until the borrower’s monthly mortgage payment ratio is reduced as close as possible to 31 percent, without going under 31 percent. Servicers must request prior written approval from Fannie Mae to deviate from the specified modification steps or to reduce the monthly mortgage payment ratio below 31 percent. In any event, incentive payments will be made based only on modification terms that reflect a 31 percent monthly mortgage payment ratio.

My advice is to appeal your property assessment to lower your property taxes. Check your county tax office to see the procedure to do so. Also try to get your homeowner's insurance lowered. Most importantly, you need more income to support a modified payment. Knowing what I know now, even if I could have reached someone helpful back in April when I started this process, there is no way I would pass the NPV test. But, two promotions later and lowered insurance and taxes, we now pass. I still have other debts to deal with, but they are not a big factor in the NPV test, just the credit counseling requirement if DTI is over 55%. Good luck and seriously look into ways to increase income and reduce taxes and insurance.

[BadBobMo]

ust an FYI, they can go below 31%, at least for Fannie Mae, but I haven't seen it reported by anyone...

Your right anything goes but the lender will have cover any rate below 2%. You do not see it or do you see write downs because no one is asking! Every one is tacking what they are offered.
Keep Fighting
It's All Greed

[NorCA]

Hi Everyone maybe you guys can help me out I have looked and looked for some anwsers, I am to fill out the Hamp info once more and am not sure if it can work for me heres where i am at:
1st mortgage $265000 1492.12 mo. Chase interest 6.7%
2nd mort. $65000 $518 month Ocwen 8.1%
No taxes or insurance
Home bought for 325,000 in 2005 now worth 205,000
Current HAMP trial modified $1153 month PITI
I am the only name on the loan, not employed
Spouses income $2800 mo has a good job
expenses not including 2nd mort. is approx $850-1000 mo
I can not figure the NVP for me or how to work the Front and rear DTI
Any help will be great
Thanks

[lemaudit]

Originally Posted by flagirl4444

Under HAMP guidelines they are not allowed to reduce your payment (PITI) below 31% of your income. They reduce the interest rate and if necessary stretch out the loan term until they hit that 31% target, but they cannot go below 31% of your income, which is $651/month. That is the lowest they are permitted to lower your payment.

Sorry, but that's not completely accurate. They can go below the 31% - they just don't get any incentive (aka money) if they do. It's all in the FAQ's on the Treasury Website. But saying that they're not allowed to is inaccurate.
That banks choose to interpret it that way is another story all together.

[Illinois Tinner]

I have more income that brings me closer to what they are asking for. Working on the paperwork and plan on sending it back first of next week.

Got a big lump of papers served to my house last night. They are suing me for the house "forclosure" Now I need to find out why this is happening after my conversation with my congresswomen she told me "Everything in regards to the forclosure is definately on hold while the mod is happening"

I have been working doing odd jobs and trying to drum up any work I can. I will do my best to show I am making enough money. My wife and I are committed to bettering ourselves with a better education and getting jobs. We WILL KEEP OUR HOME!

The new guidlines should make things easier and more streamlined I hope.

[BadBobMo]

Sorry, but that's not completely accurate. They can go below the 31% - they just don't get any incentive (aka money) if they do. It's all in the FAQ's on the Treasury Website. But saying that they're not allowed to is inaccurate.
That banks choose to interpret it that way is another story all together.

Good eye most just take what ever the lender comes up with.
It's All Greed

[flagirl4444]

Originally Posted by lemaudit

Sorry, but that's not completely accurate. They can go below the 31% - they just don't get any incentive (aka money) if they do. It's all in the FAQ's on the Treasury Website. But saying that they're not allowed to is inaccurate.
That banks choose to interpret it that way is another story all together.

Read again. The OP insinuated the Freddie Mac backs the loan. Per FM's factsheet:

"The program strives to create a more affordable first lien housing payment of principal, interest, taxes, insurance, homeowner/condo association fees, and escrow shortages that is as close as possible, but no less than, 31 percent of the borrower’s gross monthly household income."

http://www.freddiemac.com/service/fa...dification.pdf

Per FM's underwriting requirements:

"HAMP underwriting focuses on creating a more affordable first-lien housing payment of principal, interest, taxes, insurance (property, flood, etc.), homeowner/condo association fees, and escrow shortage (PITIAS) that is as close as possible, but no less than, 31 percent of the borrower's gross monthly household income."

Underwriting Requirements - Freddie Mac

Even the full servicer guide with detailed underwriting details states they cannot go below 31%.

[darkdays]

Originally Posted by Illinois Tinner

I have more income that brings me closer to what they are asking for. Working on the paperwork and plan on sending it back first of next week.

Got a big lump of papers served to my house last night. They are suing me for the house "forclosure" Now I need to find out why this is happening after my conversation with my congresswomen she told me "Everything in regards to the forclosure is definately on hold while the mod is happening"

I have been working doing odd jobs and trying to drum up any work I can. I will do my best to show I am making enough money. My wife and I are committed to bettering ourselves with a better education and getting jobs. We WILL KEEP OUR HOME!

The new guidlines should make things easier and more streamlined I hope.

Foreclosures can be put on hold while your modification is pending. You said Chase said you were short $700 to qualify for a mod. It sounds like you were denied. Once the bank denies you they can start or continue the foreclosure process.

Depending on what state you are in, you need to move FAST. Chase may require you to start the mod process all over again not just allow you to update your financials. Many on this site have had that problem when updating the financial info they have on their system would take a couple of days rather than the months it takes to go through the entire process. Good luck!