LBPS - Contribution Payment of HAMP Trial

[onlymr2]

This sounds a bit shady for me but, I'm hoping you guys can give me some input:

-My foreclosure sale date is in early June.
-Have been trying to get loan mod from LBPS since last year and only couple of months ago they actually process the paperwork (after I called them every couple of days to check on the status).
-Yesterday, they told me that they can qualify my loan for HAMP trial but they cannot start the process if I don't make the contribution payment -- 25% of the amount past due -- they said that this contribution payment is to postpone the foreclosure process while waiting for the HAMP trial approval. They also said that if not approved they will return the 25% contribution payment.
-When I asked them to send me some paperwork in writing to that effect, they said they only give verbal agreement.

What do you think? Should I send in the contribution payment?

[Cat Damiano]

Hi onlymr2,


Welcome to the forum and thank you for joining...........

That is BS with a capital B. There isn't any contributions that are needed in order to be considered for the HAMP modification program. If that is what they are telling you they are lying, which isn't surprising.


Homeowners who qualify for a modification under HAMP will never be required to pay a modification fee or pay past-due late fees. If there are costs associated with the modification, such as payment of back taxes, your servicer will give you the option of adding them to the amount you owe on your mortgage or paying some or all of the expenses in advance. Paying these expenses in advance will reduce your new monthly payment and save interest costs over the life of your loan.

[hotlove]

Hi OnlyMR2,

That is the first time I read what the lender say like that to get a HAMP mod.

Just ask around how to start the paperwork. A lot of genius in here will show
you the way... just ask and you shall get. Good luck.

[onlymr2]

@Cat Damiano -- Thanks for the reply.

They keep saying that they need the contribution payment is to postpone the foreclosure sale date (which is coming up in about couple of weeks). Also, they said that I pre-qualify for the trial payment but it's not approved yet (for the trial payment) because to submit for approval to their investor they need to present it with the contribution payment and to process for approval takes more than couple of weeks.

At this point, I'm a bit anxious. Any suggestion on what I should tell LBPS?
I know that I can pay the modified monthly payment on the mortgage but, I don't really want to pay the contribution payment if it's not part of the modification program.

[Cat Damiano]

I am not able tell you what to say to the lender but I can arm you with the necessary information to make a good argument.

What state are you in? Were you already being considered for HAMP prior to the foreclosure sale date?

According to the HAMP guidelines:

Must servicers suspend foreclosure or not initiate foreclosure for all borrowers who are potentially eligible for HAMP?

To ensure that a borrower currently in foreclosure or at risk of foreclosure has the opportunity to apply for a HAMP modification, servicers should not proceed with a foreclosure sale until the borrower has been evaluated for the program. Additionally, servicers are strongly encouraged not to initiate foreclosure until a borrower has been evaluated and determined to be ineligible for the program or the borrower fails to respond to a trial period plan offer that has been made by the servicer.

[onlymr2]

According to the HAMP guidelines:

Must servicers suspend foreclosure or not initiate foreclosure for all borrowers who are potentially eligible for HAMP?

To ensure that a borrower currently in foreclosure or at risk of foreclosure has the opportunity to apply for a HAMP modification, servicers should not proceed with a foreclosure sale until the borrower has been evaluated for the program. Additionally, servicers are strongly encouraged not to initiate foreclosure until a borrower has been evaluated and determined to be ineligible for the program or the borrower fails to respond to a trial period plan offer that has been made by the servicer.

@Cat Damiano -- That quote is actually rather helpful.
I'm in CA and I guess, yes, I'm currently being considered for HAMP because they said I am 'pre-qualify' for the HAMP trial.
I think I'm gonna try to talk to my lender again to see if they can reconsider the 25% -- even though the are only strongly encouraged.
Thanks so much for the info!

[Cat Damiano]

No problem, I am happy to help.

Please keep us posted on your progress.

[onlymr2]

Just want to post an update:

Last week, LBPS were still not budging on the 25%, they said they needed it to show the investor to postpone the loan.
Then, I went to the HAMP website (makehomeaffordable.org) to do more research based on @CatDamiano's excellent quote, and found something similar there, too. With that information, I called up the HOPE hotline and got connected to a counselor - I asked her if the lender is allowed to ask for for the money, even though the info on HOPE website shows that lender are asked to postpone (although it was never said as a 'required/must'). The counselor said that YES -- depending on the lender and the situation, lenders are still allowed to ask for some money from my past unpaid monthly mortgage payment. And... just to be sure that this is not just some random answer, I also ask several other counselors from list that I got from the hud.gov website and HOPE hotline. Similar answers with all of them.

That was last week. So, I was ready to just pay up the 25% to postpone the foreclosure sale date and get them enough time to approve my trial HAMP.

Monday of this week, LBPS called me to ask about the 25% -- I told them that I only have about half of it -- then, they just told me to send in what I have. Since I was planning to pay the 25% anyways, I sent in my payment for the amount that I told them I had.
I called LBPS again yesterday and was told that the postponement was approved until August, pending the HAMP trial payments -- as in, if I can make payments during trial period, then they'll cancel the foreclosure and mod the loan permanently; if not, then foreclosure continues.

That's the update so far. Now, I'm waiting for the trial HAMP paperwork but rather relief that the foreclosure thing is past. I'm not sure if I would've hold out longer or be more insistent that LBPS will approve the postponement without any payment at all but, I had (some of) the money to pay so, I did.

Thanks forum -- esp @CatDamiano for the assist.

[Cat Damiano]

onlymr2,



I am happy I was able to help you out. You did what you felt was necessary to stop the foreclosure and at least it ended up being less than the initial 25 percent.

Please let us know when your Trial Plan arrives and if you have any additional questions we can answer for you.