have questions about loan mod

[sirkjeff]

I feel behind on my mort. with ahms. I did not request a mod. They sent me an offer of 5% loan for 5 years, interest only. Adding the $10500, that i am behind to the princiable.
Now i am in a 30 fixed, 10 1/2%. So the payment will drop tremensly. They also figured the 5% interest only payment at 40years. One of the things that bothered me was the fact they said in accepting the this offer, they will send me a $250.00 gift card once they receive the first payment with the sign mod.

So some of my questions are as follows?

By figuring the 5% at 40 years, There is about a $400 dollars difference in interest a month. There no mention of them adding the this to the loan amount. They also did not mention that is was figured over 40 years instead of 30. It does state that after the 5 years it will revert back to the original terms.

Also, it doesn't say anything about paying down the principle during the 5 year period. Before I was behind, I was adding an extra $145.00 a month to the payment. This would save me about $200,000 , plus pay my house off in approx, 19 years.


IN loan mods, can you pay down the principle? Now i understand the most of the 4 pages they sent, But some paragraphs are legal, "mumbo jumbo".

I am self employed and my wife just started teaching. So are finances are OK. I do see us being able to make the current payment. I also do have the money to pay the back payment.
But with a 5% for 5years. As long as I can pay on the principle, I could actually be better off, Especially the fact that I'm am saving almost a $1,000 a month in interest.

Also how does they report this on my credit report?

Plus in 5years my principle will be the same and my loan will due 2037, So my payment will either go up, or I will be owing a balance at the end of the 30 term.

[Moe Bedard]

HI sirkjeff,

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

Before signing the offer..................the best thing that you can do is to have these documents reviewed by a Real Estate attorney...........they will be able to explain everything on there and also let you know the exact terms that they are referring to in the mod documents and what will happen when it amortizes after the five years.

[sirkjeff]

Hello again,

I am wondering has anyone heard of them offering a loan mod with being ask for one? I am behind, Like I stated. Its basically a 5% interest only loan for 5 years, No fees applied. I will be saving about $1,200 a month in interest.
I called them after posting here, I spoke to a person with a strong Hindu accent. In which I have no problem with. He explained that I can make payments on the interest, No extra money will be added on the princible.etc. And that there is no grace period for the payment.

After reading some of the post in here. I am a little worried about them not posting the payment, etc. Like I stated, I can catch the payments up. But the 5 year interest mod would really , really help us out. My wife and I have prayed for help making ends meet. And then this came in the mail. They say never look a gift horse in the mouth or is it look a gift horse in the mouth?

But has onone been offer a loan mod with soliciting one?

[sirkjeff]

I was asking if anyone has been offer a loan mod WITHOUT being ask for one? It seems to good to be true

[elpjohnson]

I have heard of this, yes.....after the five years does it remain fixed at 5% or does the rate adjust?

[elpjohnson]

Sorry, I just re-read your post and saw that it does revert back to the original terms. I would take ***'s advice and have the documents reviewed by an attorney......it does sound like a good mod and that you would get some relief for 5 years.....a lot can happen in 5 years.....

[Melina]

I received the same Modification offer and spent a couple of days researching it. Generally, it's a good one. If you can afford to make payments to your loan' principal balance during the interest-only term, you're allowed to do this. I plan to make payments to the principal after my other post-divorce debts are paid.

An AHMSI modification negotiator told me that this 5% interest only offer was made to people whose loans were in a particular "investors pool". Since the pool was performing really badly, it was decided to make this offer to as many borrowers as possible so as to increase the pool's rating/value.

[Melina]

Originally Posted by elpjohnson

I have heard of this, yes.....after the five years does it remain fixed at 5% or does the rate adjust?

Your loan documents should say what will happen to your loan's rate in clause 3). Mine is a fixed rate loan, and after the five years at 5%, it'll adjust back up to the original rate. If you can't find it on your letter, call the number in the last paragraph of page 2 and ask. The people answering this number seem pretty familiar with the 5% interest only mod.