Aurora Loan -told they will comply with Obama's plan as of April 1

[marincountyowner]

Sorry I am new here and not sure iff I am posting to right place but this is in regards to Aurora loans....

I have a mortgage loan with which is serviced by Aurora ( held by Lehman brothers I believe) that is a negative amoritization loan with a 6.75 percent interest only rate. It is a pick a payment plan. The lowest payment possible is $1,899 but we pay $2,500, which is as much as we can afford ( because property taxes are over $10,000 a year!) We qualify for Obama's modification plan in every regard except that the loan is not not FHA insured ( not a Fannie/Freddie), so technically I cannot qualify for a modification under Obama's plan.

FYI-our home is in Marin county ( Fairfax) and we are current on all our payments. We are not under water ( because we owe $600,000 on a house worth at least $750,000 according to Zillow) and we have good credit scores.

I cannot refinance with my lender because we don't make enough money-cannot refinance with any other lender for same reason. But we were denied for a modification with Aurora because we make TOO MUCH money-they said we CAN afford our monthly payment ( not true because in order not to go negative it would ost us $3,300 per month plus porperty taxes)....

Anyway I re-applied with Aurora on April 1 and all of a sudden they are singing a totally different tune. Now they say that we may be able to refinance under the Obama plan-even though the loan is not FHA secured, because they have decided to comply with the plan.

I am wondering if this agent knew what she is talking about??? I am so excited because 31% of our income will be just about $2500 a month and if they modify us, we will be able to stay here and not have to sell....is it too good to be true? Has anyone else heard of ( non-FHA) lenders doing this or heard of a successful modification?

[Moe Bedard]

Hi marincountyowner,



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


FHA secure doesn't have anything to do with the program..............

For the refinance your loan would have to be backed by either FannieMae or FreddieMac only...............for the Making Home Affordable Modification program............your loan could be backed by any investor as long as they are participating...........in which Aurora as the servicer is still reviewing the guidelines regarding the program.............
https://www.alservices.com/

[marincountyowner]

OK-I was confused between FHA and Fannie/Freddie. But my loan is not backed by Frannie/Freddie. On like March 30 I was told that I was denied for loan modification. Then on April first the agent said they had a meeting and now would be complying with Obama's program even if the loan was not a Fannie/Freddie. She said that they received my new request for a modification and they had opened a case that day...it was the first hopeful news I have had since I started this process on November 30, 2008. However I am worried that the person I was talking to spoke out of turn.

The ALS website is vague and not updated as fast as things are evolving-so don't trust it for info either. I will let you know what happens...

[marincountyowner]

Me again-I forgot to say thank you ***-I have been lurking here for months and would be really in the dark if it wre not for this website. Obviously I am still cconfused though and have a lot ot learn.

My complaint with Aurora is not that agents are not polite...they are as polite as any random customer service person from any 800 number. However, they do not seem any more informed than a customer service representative from the Gap. You know how frustrating it is when you ask something specific about a clothing item and then they just rotely read the website description as if you could not read that yourself?

And there is no consistency...one agent says you must wait 72 hours for the system to be updated..the other person will say 10 days...and there seems to be no rules they have to follow..and by the time they do get your information, then the info is old and they want more...For example I just talked to someone 2 days ago who said they have a complete packet for me and it is under review-but today I received a letter asking for bank statements and IRA account statements etc...which I sent them already-but that was back in Novemeber when I first applied!

Further it is SO HARD to fax many pages to them. Their fax must be receiving thousands or pages and sometimes my faxes to them get stopped half way and I am not sure which page they might not have gotten so them I have to start all over....I am afraid that if I try to pick up where I left off, they will get my pages randomly and not put them todgther ( even though I do number the pages and put the loan number on each page)...Lastly I inevitably notice errors or ommissions I made while waiting for liquid paper to dry-so have to re-fax Borrower's Financial Statement for instance-and then I worry that they will not know which version to refer to.

Oh and just getting through to a live person is the most annoying part!!!! You have to enter all this info and listen to a recorded message about when your last payment was received etc..before you can get through to a live person. Then they ask you your property address and social security number and if you are still living in the house...then you have to ask for the Home Retention Department and when one of them gets on the line, they ask you ALL THESE QUESTIONS AGAIN!! And all of this just to check on the status of the application. More often than not they say your paperwork is with a servicer ( or whatever they call them) and they cannot access it...so the they end up saying "Just wait one more day or 72 hours or 6 weeks" or whatever random number they seem to be pulling ot of a hat................................It is MADDENING. I don't even care if they are polite. I would just appreciate some informed people to speak to, some consistency, accountability and integrity.

[Walking Away]

marincounty; to make phone a bit easier; call home retenetion direct at
1-866-521-3828. And for sending faxes; make sure to put your name, property address and loan number on each page.; or they might just throw your faxes in the trash basket. Expect to wait 2 weeks just to get confirmation that they received your fax. From my 13 months of hell, and most everyone else here with Aurora; I would recommend not trying to modify yourself but to call the 995-hopeline, NACA or an attorney. Sounds like you have an option ARM?

[marincountyowner]

Yes it is an option ARM with a negative amoritization option. Homes in our specific area are not depreciating-but they are not appreciating either and I have a few years left of the loan before it resets. So there is no emergency but I just want to try to take advantage of Obama's plan so we can stop going negative. We only planned to keep that loan for a few years -and had fully intended to sell or refinance before it reset. Now we can't take advantage of better interest rates because of stricter lending standards.

I went to some website ( I think it was Frannie or Freddie-I got the link of of LoanSafe) to find out if we could refinance with Frannie/Freddie and they told me to talk to a credit counselor which I did for like 45 minutes and they sent a letter to the lender for me saying that we should qualify for Obama's plan ( except that our loan is not Fannie/Freddie)...the counselor was from Springboard Non-Profit Consumer Credit Management:

Headquarters Office: 4351 Latham St., Riverside, CA 92501
Mailing Address: P.O.Box 5438, Riverside, CA 92517-5438
951.781.0114 fax: 951.781.8027
website: Credit.org
Non-Profit Credit Help & Financial Education, Credit Debt Counseling Services, Credit Card Debt Help

email: springboard@credit.org

Is that not the same as NACA? I hate to start all over again and have to send all that documentation in again. This is what the credit counselor summarized:

Total monthly net income- $7160 ( this is before deductions for self-employment are taken)

Less minimum living expenses -$5538 ( this included mortgage of $2,500 even thought the Option 1 is $1899-and it also included property taxes and insurance of almost $1,000 per month)

Less debt repayment amount -$0

Less private debts-$0

Budget surplus -$1622 ( positive number)

Your Housing expenses consume 54.12 % of net income; national average is 35-45 %. Transportation expenses consume 9.29 % of net income; national average is 15-25 %

Does this mean anything to anyone?? Does it make my chances good or bad?

I asked this credit counselor if I should get an attorney and thay said it should not be necessary. He said he thinks Aurora will offer me a modification with a payment that is 31% of our income. I read somewhere on this site that tha would mean 31% with taxes and insurance-That sounds too good to be true.

[marincountyowner]

I just received a letter from Aurora dated on April 1, 2009 saying that I am ineligible for a modification due to the fact that we do not have enough income to afford monthly payments.

Just to refresh your memory, the company denied our request for a loan workout, saying that our financial information indicates that we can afford our current monthly mortgage payment

I spoke to a person at Aurora just now who explained that it is due to the income I am reporting for my husband who is self employed. I did not know how to report his deductions since they are for things like cell phone and clothes and part of our mortgage ( for home office). I thought Aurora would take the time to cross reference the tax returns etc.. This agent explained that they don't even really read the letters or supporting documentation until it gets to an underwriter. My information never got that far since it automatically got thrown out by someone whose sole job is to make sure all items are there and meet minimum criteria.

I told the customer service guy today that they should be counting my husband's gross receipts before his deductions for self-employment are taken. This is because the deductions are for things like a portion of our mortage for his home office, his transportation costs, his cell phone bill, etc…these are things that are also listed as liabilities on the Borrower’s Financial Statement. So we just omitted deductions all together from his income statement. It was great because we could do this all verbally ...and in the process he discovered that they had counted property taxes and insurance of over $1,000 twice!

I was so glad I spoke to him rather than faxing a new Borrower's Financial Statment as this would have just muddied the waters evern more.

Now the packet is on it's way to an underwrite ( supposedly) and we have a surplus of about $1,600 ( which is close to the number that the credit counselor figured). Is that surplus number good/bad? Anyone have any idea?

[chasepmt2hot-firefighter]

1,600.00 after the estimated new payment or still figuring the old payment?

[marincountyowner]

$1,600 is the surplus with the old loan at the lowest payment option available ( $1899). We actually pay $2,500.

I am regretting not putting more expenses in like co-pays for doctor visits and prescriptions, and more realistic food costs ( I wrote $600 for a family of 3 but it is really higher)....

It was so hard to decide what numbers to use since I am not sure if they will be counting my husband's income before deductions or after deductions.

As another person said on this site..I wish I knew what the "sweet spot" was for surplus...

[RetroBoats]

I posted below on a Aurora thread I started. I don't really think there is a correct answer.

This one is a Hoot........In November when she requested a loan mod, also sending the EXACT form/info to Aurora corporate.

• As stated before normal channels came up with negitive $177.
• Yesterday Aurora corporate came back with a positive $900.

What the heck....this is a difference of $1077 from Aurora with the EXACT same paperwork....just different folks within Aurora figuring it. This a perfect example of the SLOPPY handling Aurora gives it's customers. You just can't get a consitant answer from them.....it's a joke. There is NO way she is positive $900.

[Walking Away]

Hey marin; I think for most investors; they usually want a surplus of around $200, but it would depend on your investor. Aurora is just the loan servicer for the investor; so it helps if you can find out who the actual investor is. I think the gross is multiplied by 1 1/4 but I'm not sure because I sent in the same 3 month p & l to Aurora but they arrived at surpluses that were $600 different. Very similar to Retro's friends case. Would you be eleigible to refinance if you can't get a loan mod? If you could; you probably could get a reduced interest rate by refinancing, which has to be better than an option ARM. What an evil idea this option ARM crap is

[marincountyowner]

Hi there-

No I do not qualify for refinance. Our income is too low. I just hope that my numbers were altered enough to at least get my case looked at by an underwriter. Once it goes to them they may reduce our income by about $1,200 for deductions for my husband who is self employed, which would bring the surplus down to about $400. ( which is still a joke because there are so many expenses that I thought of later that I should have included but there were no line items for those things-like haircuts, co-pays , prescription drugs, classes and activities for my son etc..)

Walkin Away-You are self employed. DO you have expenses that were essentially counted twice? Once in your deductions from income, and then again as expenses on the Borrower's Financial statement? Or did you just give them your gross income with no deductions and let them figure our deductions themselves when they look at your tax returns?

Also Walking Away: There is only one thread started by you and it kind of ends abruptly after you shared your hardsip letter and I don't know what happened with you after that. I assume you " walked away" but it looked like you had an offer from Aurora that sounded promising and you were going to have a lawyer look it over. What happened with that?

Has no one here in this forum ever receive a modification from Aurora? Has anyone had Obama's plan implemented with them?

[Walking Away]

Hey Marin; for my financials I just write down a 3 month total. I add up my income and then add up my expenses and subtract the expenses from my income and mark that down as my net income. As good as this site is; I don't think profit and loss is explained anywhere. If I lose again I'll push for the new Obama plan and try to get help from NACA, HUD rep or loan mod company if Moe or *** can recommend one. I haven't added to the thread I started because I'm on a 3 month trial payment plan; it's called Fannie Mae Streamlined Program. You sign and notarize paperwork, resend financials and hardship and make 3 monthly payments at your new rate. Then you hope financials check out, hardship is okay and you are modified if all checks out and 3 payments are sent on time. I've read this board for almost a year and I've never seen anyone with Aurora successfully get modified; so I expect to eventually walk away. I hope underwriter helps you; withincome I just report what I make and spend and I hope it works with what they want; but maybe it's better to hire an expert who knows exactly what works.

[overallthisbs]

ALS is impossible, their left hand has no idea what their right hand is doing, I have jumped through hoops with them for months now and simply got denied, everytime I call it is something different. They are incredibly unorganized and unhelpful.

[RetroBoats]

Overallthisbs - Can you go into a little more detail of your dealings with Aurora ??

[overallthisbs]

check under my account and look up my postings, that should give you the background.....

[marincountyowner]

I just wanted to report something interesting about Aurora and this Obama Hope for Homeowners Program. yesterday I got an actual telephone call from Aurora!! I could not talk at that moment so I had to call them back but I have been trying to modify this loan since November 2008 and this is the FIRST time that I EVER received a call from them. They said that the computer is indicating that I could be eligible for Obama's Hope for Homeowners program and wanted to go over my Borrower's Financial Statement and profit and loss sheets. After holding for 20 minutes when I returned their call I told them I was about to get cut off because the batteries in my phone were going dead and they actually CALLED ME BACK. It was such a different experience than I am used to with them. THey went over all my financials in intricate detail and helped me tranfer everything we discussed into writing so I could fax them and my written information would perfectly match what we said. I ended up witha "surplus" of $230 but that included the extra payment we make on our negatively amoritizing loan. The guy told me that they would try to get my payment to 31% of our income which would be $2,300. This would be fantastic as we currently have a minimum payment option of $1899 but we pay $2,500 so we will have less negative amoritization. (we go negative by $600 per month as opposed to $1200 per month)..

So my case went to an underwriter and now I am excited. This is not a Fannie/Freddie loan but Aurora says that in many cases they are complying with the plan anyway.

[marincountyowner]

Actually I think the plan is called Making Home Affordable. I don't know-I just know it is "President Obama's Plan" that they were referring to and it has to do with 31% of our income being paid to mortgage and property taxes and insurance.

[Walking Away]

Marin; Aurora is in line to get $798 million in TARP money but they have to modify loans to get their money. So some of us with Aurora will probably save our homes~let's hope. Good update marin.

[marincountyowner]

Hi Walking Away-

This is so exciting! They told me that if I am accepted my payments would be $2,371.00 (31% of monthly gross income) for 5 years with an incremental increase each year to a maximum monthly payment of $3289.

Our current monthly mortgage payment is $1.899 is for a loan that is NEGATIVELY AMORITIZING. We make payments of $2, 500 per month but cannot afford the interest only payment of $3,425, which is needed to not negatively amortize. The fully amortized amount which includes principal and interest would be $4,014.77.

Our property taxes and insurance are about $1,000 per month on top of the payments mentioned above.

Our house is "worth" $729,000 ( maybe, that's what we bought it for)...and we owe $600,00 now and more each day since this neg am loan is the only kind we could get.

Can you tell me if we are approved would this new payment of $2,300 per month include property taxes and insurance??? No, right? That's not possible is it?

Because we have a "surplus" of $230 now, ( when we pay $2,500 a month towards mortgage) and if they add in the property taxes and insurance to a new payment of $2371-this would leave of with a surplus of $1359-which would be AWESOME and would change our whole life!

I'm expecting you will tell me no that new payment of 31% of income does not include property taxes and insurance- and even if we have to pay taxes and insurance on top of $2371 we will be THRILLED.

Also have you ever heard of this? On another website I was told that "Since our loan is current we might be eligible for loan modification incetives of $1500 and a reduction in principal amount for each of the five years." What??? Has anyone gotten sweet deals like this yet?

[marincountyowner]

One more thing I totally do not understand from the MHA website:

Apply a value test to determine if the cost of the modification, including the government’s incentive payments, is less costly for the investor than not modifying the loan. Loans held by borrowers who have a lot of equity or whose incomes are very low in relation to the value of their homes probably will not pass this value test.

Sounds like we might not pass the test? Our income is pretty low compared to value of home, no? ( we make $7646 a month on a $729,000 home that we owe $600,00 on.

[Walking Away]

Marin, I'm just a borrower like most here. I try to post accurately, but double check info I post or for real important questions; it's good to ask ***. But as far as I know, from reading lots of info on it and the Fannie Mae website; the Obama plan is based on the mortgage and escrow combining to be no more than 31% of the gross income. To get the 31% and to figure in the escrow also; they often will have to extend the loan to 40 years and lower the interest rate. I think the lowest they'll got with interest rate is 2%. For your numbers to work; I'm guessing you'd be a very low interest rate. With the Obama plan there are incentives for borrowers to make timely payments. I think it's like you said; about $1,500/year for the first 5 years will come off the principle. The loan servicer also will get some incentive money if borrowers stay current. This sounds like it will definitely make your home affordable, Marin; so I hope they approve you and it works out.

[Walking Away]

Marin, is your home currently worth $729,000 or was that what it was worth when you bought it and it's dropped in value? *** would understand this clause better, but if your home has dropped invalue a fair amount since you purchased it; then you probably don't have much equity in it. As to your income; if they can make your mortage and escrow to be 31% of your income with a 40 year loan; without going under 2%; I think you'd be fine. I think 2% is the limit, but I'm not totally sure. Probably best to wait and see what the Aurora underwriters come up with. They tell me I'm approved and my numbers are proportionate to yours in regard to income and the house value(I've got 1/3rd the income and 1/3rd the house value)

[marincountyowner]

Hi "Walking Away". How do I ask an expert a question or get them to notice my posts?

The only online calculators for that "value test" are on the Fannie/Freddie websites with guidelines for servicers and they need to us an ID code to gain access.

[Moe Bedard]

marincountyowner,



The modified payment under the Making Home Affordable plan should include principal, interest, taxes, and insurance.

Front-End DTI is the ratio of PITIA to Monthly Gross Income. PITIA is defined as principal, interest, taxes, insurance (including homeowners insurance and hazard and flood insurance) and homeowners association and/or condominium fees. Mortgage insurance premiums are excluded from the PITIA calculation.

The Front-End DTI Target is 31%.