For those who have been successful....

[kbcouch]

Maybe you can shed some light on the modification process. I just found out from my bank, Flagstar, who denied my first modification that we were denied over a 5% difference!! It seems as though talking to different people yields different information...the last person went into a little further detail than the one who served us with the 'denied...your income is less than your expenses'. The debt to income ratio in order to qualify for HAMP is 55%, we were 60%. I know for a fact that our expenses were a bit overstated. When you fill out your financial worksheet that's one thing...then you have a telephone interview and they ask all kinds of things and break down each expense, right down to 'do you have pets? how much do you spend per month on food/expenses?'...then they tally everything up and either add or modify your financial worksheet before submitting. So now I know that I can reapply and I am making a worksheet, broken down as to how they ask the questions so I account for everything one time. I know where I need to trim back and not be as honest! One question I have is...the loan is in my husbands name only...should I include my income or exclude some of the things that I pay, such as utilities? Second question, we do have a paid off truck with a value of $7,500, do I want to include that in our assets or could they say 'sell your truck to make your payments'...with 4 children, we need this vehicle!

[Evan Bedard]

I know where I need to trim back and not be as honest! One question I have is...the loan is in my husbands name only...should I include my income or exclude some of the things that I pay, such as utilities? Second question, we do have a paid off truck with a value of $7,500, do I want to include that in our assets or could they say 'sell your truck to make your payments'...with 4 children, we need this vehicle!

There is really no need to include the truck if it has already been paid off. When you 1st applied for the modification did you include your income as well? Even though you are not on the loan it is always a good idea for a couple pursuing a modification to include all sources of income especially if you two share bank accounts. But remember for HAMP your mortgage must exceed 31% of your gross monthly income to qualify for the program.

[kbcouch]

There is really no need to include the truck if it has already been paid off. When you 1st applied for the modification did you include your income as well? Even though you are not on the loan it is always a good idea for a couple pursuing a modification to include all sources of income especially if you two share bank accounts. But remember for HAMP your mortgage must exceed 31% of your gross monthly income to qualify for the program.

Thank you for your response! When we first applied, we were already at 31% or so I thought. I am not sure what income they were using, but he said we were being considered for a $900 payment versus our current $1176, but then we were denied as our DTI was 60%. The income that was included was my husbands gross ($4161 at the time) and our adoption subsidy of $1500. Using those figures, we are lower than the 31%, so I am real confused. It would seem as though I need to not add my income and get our expenses down by another 5%.

[Evan Bedard]

Do you and your husband share bank accounts? If so your servicer is going to question where that money (ie your income is coming from).

[kbcouch]

Here's the strange part...I cash my checks and keep the cash on hand for grocery shopping etc. I don't deposit my checks. I only make $150 per week.

[Evan Bedard]

Well if that is the case it is really up to you whether or not you want to disclose your income. Since you keep cash on hand there is really no way they can find out you are employed as well.

[hangtough]

I haven't dealt with HAMP but I wanted to ask...when you were denied (and I also thouht you could only apply once for HAMP?) Did they offer you an inhouse mod? It's always wise to get the name and ext number of the person you talk to and only deal with that person. Are calling regular customer service or loss mitigation?

[Evan Bedard]

I haven't dealt with HAMP but I wanted to ask...when you were denied (and I also thouht you could only apply once for HAMP?) Did they offer you an inhouse mod? It's always wise to get the name and ext number of the person you talk to and only deal with that person. Are calling regular customer service or loss mitigation?

If you were denied for HAMP and the decision was based off false information you can appeal the decision and they may review your account a 2nd time for the program. If it is determined you do not qualify for HAMP your servicer will review your account for a regular in-house modification..

[hangtough]

Gotcha. For us, ours did not exceed 31%... it was 29%.

[kbcouch]

When we were denied the first time, we were only told that our DTI was more than 55% (someone later actually told me we were 60%), at that time, I said that I felt our expenses were inflated due to the telephone interview and he said that I can certainly apply again. When I asked if there was anything else we could do, he said 'no, apply for a short sale'. We were not offered any other solutions including an in house mod. I have dealt strictly with the loss mitigation department, customer service cannot do anything along that line. When I apply again, I will more than likely get another loan counselor.

[hangtough]

I haven't read much about Flagster but they really don't offer an inhouse Mod?

[brokeinmichigan]

Gotcha. For us, ours did not exceed 31%... it was 29%.

Just double checked our math, and we are at 30.94%....this oughta be real interesting. Of note, since my DH is the only borrower on our mortgage, we did not include my income. If we did, our mortgage would be well under the 31% mark....more like around 15%, so certain that a HAMP would be a no-go. Watching and waiting.....

[hangtough]

So close! I know that HAMP has such strict guidelines...it really stinks. I do hope they give it to you. We were able to find out right away that we weren't approved and then we applied for the in house mod.

[Evan Bedard]

Just double checked our math, and we are at 30.94%....this oughta be real interesting. Of note, since my DH is the only borrower on our mortgage, we did not include my income. If we did, our mortgage would be well under the 31% mark....more like around 15%, so certain that a HAMP would be a no-go. Watching and waiting.....

Is there anything else that is causing your payments to be unaffordable? Also do you and your wife share bank accounts? Just asking because if they do determine you are working and your financials as well, there is no way they are going to approve your account for a modification if the mortgage is only 15% of your gross monthly income..

[kbcouch]

Well now a huge wrench has been thrown into this whole matter and I don't know if it is good or bad! My husband was just put on disability and has surgery scheduled for June 27th. As of right now, they are projecting him to be able to go back to work on August 22nd. So that is 40% reduced income from now until the beginning of September. We are actually scheduled to go to the Fair Housing Administration on Monday morning because now we can supposedly get some help...we were turned away last December because we had a discharged bankruptcy in Oct 08, but now the rules have changed and you can have a discharged bankruptcy. So rather than go it alone again, it would be nice to have someone behind us.

[Evan Bedard]

I'm very sorry to hear what has happened to your husband. Since he will not only be receiving 40% of his normal earnings through temporary disability they cannot use this income when reviewing your account for a permanent modification. At least until your husband is able to provide updated paystubs once he returns to work.

[kbcouch]

I'm confused by what you are saying....this hardship is going to effect us for quite a long period of time. Does this mean that the bank won't consider helping us?

[brokeinmichigan]

Thanks for the reply. I am the wife. We have separate banking accounts, and my husband is the only one on the mortgage. We have 3 kids in college, which has added to our financial stressors. We are upside down by about 30K on mortgage....

[kbcouch]

Do you have an FHA loan? Standard HAMP for GSE and Securitized loans does not have a back-end DTI requirement, you are simply required to attend HUD counseling if the post-mod DTI is over that 55% cutoff. I underwrite modifications, and we cannot decline a HAMP request for back-end DTI. FHA-HAMP is the only HAMP program I know of that requires a post-mod back-end DTI below 55%. USDA may as well, but that happens to be the one investor I do not work with. Are you in default or imminent default?

I'm not sure if this question is for me as there are others posting...but yes, we have an FHA loan.

[Evan Bedard]

I'm confused by what you are saying....this hardship is going to effect us for quite a long period of time. Does this mean that the bank won't consider helping us?

No this does not mean you will not get any assistance. However, if your husband is only going to be on disability the next two months until the end of August your servicer cannot use this income when reviewing your account for a permanent modification. What income do they currently have on file for your husband?

[kbcouch]

They would have what he made previous to the disability...which is lower due to no overtime.

[Evan Bedard]

If they happen to request updated financials from you before he returns back to work they may end up offering a repayment plan such as a forbearance if they are aware of his condition.