Loan modifications before you go deliquent

[donaldnstacy]

Hello all! I am new to this website and I am looking for some peoples experiences or answers to my questions about loan mods before you get deliquent on your mortgage. My husband and I have our mortgage with Wells Fargo, and we have been in contact with them about our mortgage and that we would like to modify our loan with their help. As normal they have asked us to compile a hardship letter, exp. worksheet, etc. We are working on all that for them, but we have been talking to some people that have done the same thing recently, and got no where! They all had to eventually start not paying the mortgage monthly in order for their banks to even start trying to help them. Why is it that banks won't help before hand??? Is there anyone out there that has had experience with this and know some different routes that we should take or consider? My husband is the type of person that has worked hard for his credit, and doesn't want to damage it at all just to get our loan modified. He is basically at the point now that if we have to go deliquent on payments, he is just going to let the bank have the house back, because they are not working with us! Can I please ask someone out there for your advise or experience on this same situation. Thanks!

[LHarveyMadman]

It's going to be dependent on the lender and investor(s) whether you can get a modification without being late. Several B of A customers on these boards were able to get modifications while current on their payments. This was before the government plan was in place.

In the case of the B of A borrowers, we all had no luck trying to call the loss mitigation number. We got success by emailing our hardship letters to certain high-level executives who then forwarded our stories on to the appropriate loss mitigation supervisors. Maybe a similar approach with WF will help.

[Corrina]

Hi Stacy.... my story is exactly the same as yours. We have Provident Funding and I started calling them in January to see what programs there are because we had depleated all of our savings and were now paycheck-to-paycheck and was basically told the same thing you were and to check back in 2 weeks because they were working on a program. Finally, the last person I talked to straight out told me that they couldn't do anything for us unless we were behind. My credit is already shot due to not being able to make the minimum CC payment and have now closed out and worked out agreeable amount w/CCC's. Then I ended up having to have a hysterectomy the end of June and we had to come up with 1K for our portion... sooo no house payment was sent in for June or July. I finally mailed the June payment on 7/15 but won't be able to pay July until August. We did receive a packet that I am going to fill out.

My husband has worked also really hard for his credit however he does not want to give up the house. His mentality now is he wants to know that at the end of the day we tried all options to try and save it.

I do agree with you though. The banks are the one's tearing the housing market up. If they were more willing to work with homeowners who want to stay in their homes the amount of foreclosures would slow immensly (I feel). Especially for the homeowners that try to work with them BEFORE they go into default. It makes no sense at all.

[Lola8]

Originally Posted by donaldnstacy

Hello all! I am new to this website and I am looking for some peoples experiences or answers to my questions about loan mods before you get deliquent on your mortgage. My husband and I have our mortgage with Wells Fargo, and we have been in contact with them about our mortgage and that we would like to modify our loan with their help. As normal they have asked us to compile a hardship letter, exp. worksheet, etc. We are working on all that for them, but we have been talking to some people that have done the same thing recently, and got no where! They all had to eventually start not paying the mortgage monthly in order for their banks to even start trying to help them. Why is it that banks won't help before hand??? Is there anyone out there that has had experience with this and know some different routes that we should take or consider? My husband is the type of person that has worked hard for his credit, and doesn't want to damage it at all just to get our loan modified. He is basically at the point now that if we have to go deliquent on payments, he is just going to let the bank have the house back, because they are not working with us! Can I please ask someone out there for your advise or experience on this same situation. Thanks!

Hello from another newbie!

Yeah, my parents have their loan with WF. We applied for a loan mod in June, and we were just denied. Many people here have been given the run around by WF, at least we were told in 40 days that we did not qualify (for them)

Our friends have loan with B of A, and last month they were told by staff to stop paying (!!!!!!) They have not done that yet...

I wonder what's best: to keep throwing money into an underwater hole, or stop paying to get WF to work with us

[kalea]

Hi donaldnstacy...
We are in the same situation. We contacted WF to help lower our payment. We have not missed any payments.After 2 1/2 months since sending our docs we just recieved our trial modification ageement which lowered our payment for three months. It did not mention any terms which made me wonder. Also within the fine print says during the trial period our credit report will be delinquent. I called WF to confirm this. I was told by one rep that another form would disclose the terms and if I did not accept the modification I could negotiate another modification. Another rep told me there is no terms until the trial period ends and that there was no way around the trial period. I am very confused and don't know what to do next. The reason why we contacted WF for help was to save our credit. Yet it seems we have to ruin our credit for them to consider helping us. I am not sure what to do next. I'm hoping someone here can shed some light.

[mimat2]

I feel so bad to read about all the homeowners that are having hardship and not able to get any cooperation from the loss mitigation dept. Do you believe that sometimes it better off hiring someone to get result of a loan modification. But do your homework well, because there are lots of crooks out there. But a good loan mod will package your application that meet your bank guidelines, they know who in your bank's loss mitigation dept to talk to, they argue your case without fear and get you the best possible result. In all cases where owners try to deal with banks, I have yet to see the best result come out for them. But becareful of the crooks who just want your money and let your house foreclosed right before your eyes.

[scooter]

We are current on our loan and just received the initial loan mod letter from WF. In January when my husband was laid off we went from a two income (where he was breadwinner) to a one income family. It did take approximately 100 days for the approval to go through. The initial letter that was sent out to us is extremely vague and doesn't even really include any terms other than the fact that we're to pay X amount of money by such and such dates for the next three months. If we do that satisfactorily then we'll receive the terms. Weird, huh? I don't see anything about this negatively affecting our credit but now am worried.

[delaysmom]

i think that they will report you as delinquent if you are already delinquent. Don't quote me... I have WF and have been dancing around with them since april. currently, they promise to have a determination in the next 2 weeks. but because i have made all my payments (borrowing, selling things, offering up my husband for computer fixes for $$$) they SAY they will not report me delinquent...

[luvmyhorse]

Originally Posted by kalea

hi donaldnstacy...
We are in the same situation. We contacted wf to help lower our payment. We have not missed any payments.after 2 1/2 months since sending our docs we just recieved our trial modification ageement which lowered our payment for three months. It did not mention any terms which made me wonder. Also within the fine print says during the trial period our credit report will be delinquent. I called wf to confirm this. I was told by one rep that another form would disclose the terms and if i did not accept the modification i could negotiate another modification. Another rep told me there is no terms until the trial period ends and that there was no way around the trial period. I am very confused and don't know what to do next. The reason why we contacted wf for help was to save our credit. Yet it seems we have to ruin our credit for them to consider helping us. I am not sure what to do next. I'm hoping someone here can shed some light.

during your modification trial period, continue to pay your full original mortgage amount. This will prevent damage to your credit. If you are going to ruin your credit, go all the way and go bankrupt, at least you will walk away clean. It is not worth ruining your credit for the money you will save over the 3 month period.

[LHarveyMadman]

Originally Posted by luvmyhorse

during your modification trial period, continue to pay your full original mortgage amount. This will prevent damage to your credit. If you are going to ruin your credit, go all the way and go bankrupt, at least you will walk away clean. It is not worth ruining your credit for the money you will save over the 3 month period.

Unfortunately, some people are reporting that when they enter the modification trial period, their credit scores are suffering greatly because their mortgage is being reported as "paying under a partial payment agreement". This is happening even if they were not delinquent when they entered the trial period.

[bittersweetme]

Originally Posted by LHarveyMadman

Unfortunately, some people are reporting that when they enter the modification trial period, their credit scores are suffering greatly because their mortgage is being reported as "paying under a partial payment agreement". This is happening even if they were not delinquent when they entered the trial period.

well I was ASSURED today, that during a "special forbearance" ( may not be the same as a trial) that while paying the lower payments (with B of A) that there would DEFINITELY be a credit block since I am current. I should receive the papers tomorrow so I can read them over before I put my J. Han**** on them. I don't know if WF does this..... but I thought I would put my two cents in.... That's about all I have left at the end of the month

[luvmyhorse]

What is a credit block?

[luvmyhorse]

I DON'T KNOW WHY THIS IS SO HARD TO UNDERSTAND PEOPLE... DURING YOUR TRIAL PERIOD, BEG BORROW OR STEAL THE MONEY TO PAY YOUR ORIGINAL PAYMENTS... JUST FOR THE 3 MONTHS. When they approve the mod you will then have the new lower payments and you can get caught up! Don't ruin your credit over 3 months... if you still have good credit.... i think everyone is so desperate for the reduced fee they can't think straight.... I asked BOA and they said you can still pay your original payment, then they can't report you....

[bittersweetme]

Originally Posted by luvmyhorse

What is a credit block?

credit block is where they will not report you as delinquent or any other such phrase that will harm your credit. That is what i was told by the person helping me. I will wait to see it in writing before i pay the 1/2 payment though. I dont go blindly into things.... i need it in black and white.

[luvmyhorse]

BTW how was your mod process. Did you learn anything about their secret formulas?

[bittersweetme]

well, My process to this point was very quick, a few e-mails and phone calls and this is the temporary solution they gaveme. I think I only started this whole thing about a week and a half ago. It has been quite painless, but I am relentless. I am going to start calling NACA next Monday a week is sufficient to get some info after submittal. And unfortunately I learned none of their secrets, they told me if they told me they'd have to KILL me!

[luvmyhorse]

Well I envy you!

I am holding off applying until after the 15th when the new 125% underwater rule comes out. Even then I am sure I don't earn enough to be approved. I am desperately trying to find out if there is anyway I would be approved with my income being so low compared to my principal balance. No one seems to know.


If I get a 2nd job, some sort of 3rd shift situation and drum up more income will they approve me? My cc debt is 100% of my yearly last year, so I think they will decline me for that too......

What was your situation, what kind of mod did you get?

[LHarveyMadman]

Originally Posted by bittersweetme

well I was ASSURED today, that during a "special forbearance" ( may not be the same as a trial) that while paying the lower payments (with B of A) that there would DEFINITELY be a credit block since I am current. I should receive the papers tomorrow so I can read them over before I put my J. Han**** on them. I don't know if WF does this..... but I thought I would put my two cents in.... That's about all I have left at the end of the month

I had a credit freeze on my account during the modification process too. No payments, not even my suspense payments when my mod was in limbo, were reported, and no missed payments were reported either. I was current when I applied for my mod, but was told to intentionally skip two payments during the early part of the process.

bittersweetme, if you are not getting modified under the Making Home Affordable plan or any other government plan, then you might be unaffected. But there are new guidelines from the Consumer Data Industry Association which would result in a negative field code being reported to the credit reporting agencies (Equifax, Experian, and TransUnion).

Details of the CDIA reporting guidelines are here:

http://cdia.files.cms-plus.com/Metro...nesMay2009.pdf

Page 2 describes the "AC" comment code, "paying under a partial or modified payment agreement". I suspect that this reporting is inconsistent among lenders.

If you're not under a government plan, then the forbearance guidelines on page 8 might apply. The reporting here appears to be optional under certain conditions.

[kalea]

Originally Posted by luvmyhorse

I DON'T KNOW WHY THIS IS SO HARD TO UNDERSTAND PEOPLE... DURING YOUR TRIAL PERIOD, BEG BORROW OR STEAL THE MONEY TO PAY YOUR ORIGINAL PAYMENTS... JUST FOR THE 3 MONTHS. When they approve the mod you will then have the new lower payments and you can get caught up! Don't ruin your credit over 3 months... if you still have good credit.... i think everyone is so desperate for the reduced fee they can't think straight.... I asked BOA and they said you can still pay your original payment, then they can't report you....

I already asked WF if we could do that but they said it would not matter because it would still report as delinquent. Yes I know...full of crap. But what else do I do.

[luvmyhorse]

ASK SOMEONE ELSE. The person I spoke with said, if you pay the original amount they can't report you as delinquent.

[SALLY SUE]

HOMECOMING LOAN MODIFICATION LAWYERS IN FLORIDA HELPED US -GOT US TWO GOOD ONES! DOES ANYONE KNOW IF HSBC WILL WORK WITH ME ON HOUSE TAXES BEING PAID WITH WRITTEN AGREEMENT WITH COUNTY; BUT TECHNICALLY BEHIND, NOW THAT OUR LOAN MODIFICATION HAS GONE THROUGH?ARE THEY FLEXIBLE AT ALL AND WILL WORK WITH ME OR ARE THEY STRICT?

[SingleMomNCA]

DEFAULT - DEFAULT - DEFAULT!!!!!

I was just told yesterday that my Loan Modifacation was denied and I was current on my mortgage payments. I have yet to hear ANYONE HAVE ANY SUCESS while remaining current on their mortgage.

I'm just like your husband, I have work hard to keep my credit decent but in the end, if you need the help, then you have to do what you have to do... In the end, your credit does not define who you are..... you can always rebuild it!

[luvmyhorse]

anyone heard if they started the 125% underwater loan mods?