ASC Modification Trial Plan....What is this balloon payment???

[klsdallas]

Okay, so I am new to this forum and quite frankly more discouraged than ever after reading so many posts about how predatory ASC seems to be.

We have 2 mortgages with ASC, a first that readjusted this month to 8% (217,000) and a second at 9%(57,000). I have had to quit my job due to our child's medical issues. We knew this adjustment would be coming and with our income significantly decreasing, we started checking into all our options early on. We are not behind as of yet.

We met with realtors about selling our home starting last fall, but since we are new construction, and with the appraisal going down this year, we would not even break even. We have talked with several lenders and all say an FHA Secure would be our best bet, but since we have a significant escrow shortage (we could not pay our taxes this past year due to our situation), we would be over the cap in our area by about $13,000 (which we cannot do unless we don't make our current payments here for a few months but by then our credit will be shot).

We got counseling from the HOPE Line who told us to ask for a fixed lower interest rate with an extension of terms from ASC. We started this process in February. We sent all documents and a hardship explaining my child's illness and a work out sheet showing only $230 left after all expenses. They sent us a letter in April (after several calls that I documented) denying us because we were "missing a proof of income from me" (Even though I do not work due to our baby's illness). So they claimed that we had to start the entire process over, which could take over 90 days again. (all of this is documented)

The loan modification seems to be our only hope of keeping our house (which we very much love) but I feel they are just stalling to see if we can make this month's new payment that has gone up another $800. I call every day to check and they say a negotiator has it now).

With help from our family, we could probably scrape together the extra money, but is that showing them that we can handle the payment going forward so they will more than likely deny us the modification?

We have worked very hard to keep our credit clean through all of this. My other question is this....
we have racked up a lot of credit card debt and have worked out a plan with most of the card companies where we pay a set amount while we get back on our feet. This is totaling about $750 a month (the additional mortgage amount). Should I charge off the cards for now or make very little (like $5 payments) so I can pay the mortgage? Should I pay the first mortgage and not the smaller second for awhile?

We just need some help in sorting all of this out as in about a week, our payment will be considered 30 days late. Thank you for any and all help!!!

[Moe Bedard]

Welcome to the community! Don't get discouraged, get educated. You need to fight fire with fire. That is all. ASC is owned by Wells Fargo who hides behind ASC as their servicing arm. Their collection guys. But there is hope, when you get educated on what to do.

I have had to quit my job due to our child's medical issues. We knew this adjustment would be coming and with our income significantly decreasing, we started checking into all our options early on. We are not behind as of yet.

This is a legitimate hardship.

We met with Realtors about selling our home starting last fall, but since we are new construction, and with the appraisal going down this year, we would not even break even. We have talked with several lenders and all say an FHA Secure would be our best bet, but since we have a significant escrow shortage (we could not pay our taxes this past year due to our situation), we would be over the cap in our area by about $13,000 (which we cannot do unless we don't make our current payments here for a few months but by then our credit will be shot).

Maybe the new FHA Bill that passed Congress will be of help. That is unless Bush veto's it has the administration has indicated.

They sent us a letter in April (after several calls that I documented) denying us because we were "missing a proof of income from me" (Even though I do not work due to our baby's illness). So they claimed that we had to start the entire process over, which could take over 90 days again. (all of this is documented)

Good. ALWAYS document this. When you speak with employees, get names and employee numbers. You have a mortgage servicing issue and you need to get educated on the laws that will maybe help you in your plight.

The loan modification seems to be our only hope of keeping our house (which we very much love) but I feel they are just stalling to see if we can make this month's new payment that has gone up another $800. I call every day to check and they say a negotiator has it now).

Good. Be the squeaky wheel. You need to be loud in order to stand out and not get lost in the foreclosure system.

With help from our family, we could probably scrape together the extra money, but is that showing them that we can handle the payment going forward so they will more than likely deny us the modification?

You got it! It's like poker. You are showing no signs of folding, yet. They assume you will do whatever it takes and they usually measure this by how late you are.

we have racked up a lot of credit card debt and have worked out a plan with most of the card companies where we pay a set amount while we get back on our feet. This is totaling about $750 a month (the additional mortgage amount).

They usually only like about $500 in consumer debt.

Should I charge off the cards for now or make very little (like $5 payments) so I can pay the mortgage? Should I pay the first mortgage and not the smaller second for awhile?

It's really a judgment call. But from my experience and the countless stories, it will be very tough, but not at all impossible. ASC is tough on people who are not delinquent. Why? Because you are not a loss risk.

It appears that you really need to keep going for the loan modification and work on that debt.

You may want to write what a lot of people have done here and have obtained success as a result.

12 usc section 2605 servicing of mortgage loans and administration of escrow accounts

Source HUD

(e) Duty of loan servicer to respond to borrower inquiries
(1) Notice of receipt of inquiry
(A) In general

If any servicer of a federally related mortgage loan
receives a qualified written request from the borrower (or an
agent of the borrower) for information relating to the servicing
of such loan, the servicer shall provide a written response
acknowledging receipt of the correspondence within 20 days
(excluding legal public holidays, Saturdays, and Sundays) unless
the action requested is taken within such period.

(B) Qualified written request

For purposes of this subsection, a qualified written request
shall be a written correspondence, other than notice on a
payment coupon or other payment medium supplied by the servicer,
that--

(i) includes, or otherwise enables the servicer to
identify, the name and account of the borrower; and
(ii) includes a statement of the reasons for the belief
of the borrower, to the extent applicable, that the account
is in error or provides sufficient detail to the servicer
regarding other information sought by the borrower.

(2) Action with respect to inquiry

Not later than 60 days (excluding legal public holidays,
Saturdays, and Sundays) after the receipt from any borrower of any
qualified written request under paragraph (1) and, if applicable,
before taking any action with respect to the inquiry of the
borrower, the servicer shall--

(A) make appropriate corrections in the account of the
borrower, including the crediting of any late charges or
penalties, and transmit to the borrower a written notification
of such correction (which shall include the name and telephone
number of a representative of the servicer who can provide
assistance to the borrower);

(B) after conducting an investigation, provide the borrower
with a written explanation or clarification that includes--
(i) to the extent applicable, a statement of the reasons
for which the servicer believes the account of the borrower
is correct as determined by the servicer; and
(ii) the name and telephone number of an individual
employed by, or the office or department of, the servicer
who can provide assistance to the borrower; or

(C) after conducting an investigation, provide the borrower
with a written explanation or clarification that includes--
(i) information requested by the borrower or an
explanation of why the information requested is unavailable
or cannot be obtained by the servicer; and
(ii) the name and telephone number of an individual
employed by, or the office or department of, the servicer
who can provide assistance to the borrower.

(3) Protection of credit rating

During the 60-day period beginning on the date of the servicer's
receipt from any borrower of a qualified written request relating to
a dispute regarding the borrower's payments, a servicer may not
provide information regarding any overdue payment, owed by such
borrower and relating to such period or qualified written request,
to any consumer reporting agency (as such term is defined under
section 1681a of title 15).

Write your letter, keep calling and read some success stories like this. Best of luck and please keep us up to date.

Loan mod with ASC SUCCESS!!

ASC Success, What a Mess I've Got Myself Into ( 1 2 3 ... Last Page)
evel1999

04-10-2008 03:41 PM
by mct123

2445,763 ASC Success, Fighting Since September! ( 1 2 3 ... Last Page)
mar639

04-10-2008 03:40 PM
by mct123

851,691

[klsdallas]

Thanks for the advice! I am starting to see that we have to play their game and if that means not making the payment this month, then I guess that's what we have to do.
One other question....we only requested the modification on the first loan and not the second. The HOPE NOW Line told us to start with the first one and then worry about the second later. Should I be concerned about this and since we are already in "negotiations" with ASC, is it too late to do this?
Also, should I have stated the rate that I would like to have. I just stated that I wanted a lower fixed rate with extended terms to make the payments more affordabe. Not sure now what they will propose for us.

[klsdallas]

Okay, thanks for the letter model. I wrote one and faxed it to the loss and mit. dept and I will send a copy via certified mail too.

[Aquarian29]

Hello,
I was reading your posts and thought I would let you know what we did with ASC. I am one of the ASC success threads getting a loan mod. We stated exactly what interest rate we wanted our ARM Fixed at (basically the starting rate) and explained that we had been on time with these payments but specifically stated why we couldn't make the new payments. We were very detailed with all of our info so they new the whole picture. I sent letters certified, so I knew they received them and keep calling them. There are a lot of good phone #'s on this site (and addresses). If you keep in contact with them and they know you are serious you can get a loan modification! Hang in there and Good Luck!

[klsdallas]

Thank you, Aquarius....yes, I read your story. Should I resend out a request for a modification with our starting interest rate? It is already with a "negotiator" from what they are telling us.
I will send a certified letter again stating more specifics. When you say you stated all details, can you be more specific? We have two loans and the first one is the arm. When it was at a 7% we were paying $800 less. I guess I need to show them details that we were never late then on this one.
If they deny us, can we reapply? In one week we will have the new payment considered 30 days late and it will be reported to credit. We are going back and forth on if we should pay it. If we pay it, we will be showing them we're able to (when really we won't be able to going forward). I have never missed a mortgage payment so I am freaking out about this.
If we decide not to pay it, should we put that money in an escrow account?

So confused!!!

[klsdallas]

Also, the bigger questions that I am confused on is this....

In Aquarius' post I noticed that the payment went up $250 a month. I understand that it is a fixed rate now, which is great b/c you mentioned a big balloon at the end, but how are you managing that extra monthly payment?

I cannot see going through all of this work to get a mod., when our payments will just end up going up.

Sorry if I sound ignorant on this one.....

[Moe Bedard]

For the modification putting a rate into a hardship really isn't going to help you.......Aquarius just asked to go to the original start rate on the loan.........which most lenders will do......but only if the investor on the loan will agree......it is ultimately up to what the investor will or won't modify......

The reason the payment could go up is if you do not have an escrow for taxes and insurance most of the lenders will require setting up one as a part of a modification which will raise the payment up by that much.......

If you are already escrowed for these items then you will know what you payment is going to be......

If you start rate is 7%.......that will most likely be what ASC will modify to......we have not seen them go below that point.......

If you receive a modification offer and have questions on payments you can post here and we can see if we can help you out........

[klsdallas]

Okay, I see now how this works out. Thanks *** Damiano for the explanation.

We actually just had to set up an escrow with ASC in March because we could not pay our taxes out of pocket this past year. So, they have already set this up for last year and 2008-09 and it did make the payment go up a lot.

...Been reading all of these posts about ASC and it's nice to know some people have actually gotten to speak with the "Almighty Negotiators". I've been told time and again I will never get to speak with one, only receive a letter and maybe a phone call once approved.

[Moe Bedard]

I don't know what number you are calling, but they are all calling in to the

ART Team
1-866-398-7569

Accellerated Fax #
1-866-453-6315

hope that helps.........
keep us posted........

[klsdallas]

I have been calling the correct ART team number but I had a different fax number. Good to have this one.
Also, I just called them and "Tammy" told me that Brian is my negotiator. At least I have a name to work with, although she wouldn't give me the last name.
I hate this whole process. I hate how "secretive" it all is. I really lost it with one of the girls last month when she told us our mod was denied due to one piece of info not being in (that we were never infomred of) and that we'd have to reapply, taking another 90 days. She started screaming back at me and refused to give me her work ID number and when I asked to be put on with a supervisor, she laughed and said no. I hung up livid and feeling really helpless. Now I'm scared that conversation screwed up my chances of this mod. Uggghhh!!!!

[Aquarian29]

Hi,
If 7% was your starting rate that is probably the lowest they will go to. If you can send them documentation showing that you were never late at that rate (which they should obviously also have) it would probably be good (since they don't seem to communicate between departments very well) I figured the more info they have, the better. The reason our payment will go up is that we had a scary 40 year loan. It was amortilized over 40 years but was paid through 30 years (this made our payment lower), but when I looked at our loan papers it said there was a balloon payment at 30 years (we would have still owed $281,000!! after 30 years!) This way in 28 years the loan will be entirely paid off! The only good thing is that my husband gets a raise of about $200 in August, so it will about even out for us (will only be paying about $50 more when the raise kicks in) Luckily our first new payment isn't until 8/01/08. Here are all the #'s I have for ASC. Hope this helps. Hang in there and keep us updated.

Loss Mitigation Department - 877-222-7875
Loan Modification # 866-398-7569
Arm Reset team # 866-398-7568
Another Negotiations/Loss Mitigation# 866-248-5719
Phone # that was on our Modification papers if we had any questions, not sure what department this is? 800-662-3806

Accelerated Fax # 866-453-6315 (Put name, address, Loan# Last 4 #'s of SS on every page)

[Aquarian29]

Hi again,

I thought I would post both my letter thats I sent to ASC. The first was in March, I got back a reply that had nothing to do with my original letter, so I sent the second one in April:

1st Letter

To Whom It May Concern:

Our ARM mortgage’s interest rate will be resetting on September 1st, 2008. At that time our interest rate will rise from 7.5% to 9+%. Considering by current income, there will be no way I can afford the increased payments come September. Hopefully there is a way to renegotiate the terms of my current mortgage to avoid default or foreclosure of my home.

Is it possible to have my current adjustable rate mortgage converted to a fix rate? If this is not possible can the next rate change be postponed to a future date to allow me to hopefully refinance? I believe we may qualify for the rate freeze program that President Bush has worked out with the mortgage industry.

My mortgage was originally written by another company and bought by ASC. I was assured at that time that refinancing would not be a problem but that turned out not to be true due to the downturn in the housing industry. The main problem is that my property is now worth about 20% less then when I refinanced.

We have lived in our house for six years, since it was built, and have no plans to move in the foreseeable future.

Attached are recent pay stubs showing my current income.

Thank you for your time and consideration.


2nd Letter:

I received the enclosed letter from you dated April 10th, 2008. I am confused by this letter. I have also enclosed the letter, dated March 28th 2008, I sent asking that my interest rate remain the same and not reset in September. I believe that I should qualify for the rate freeze program that President Bush worked out with the mortgage industry late last year.

I do not want my interest rate reduced, I just want to make sure that it does not increase. If it goes up, I will not be able to pay the new payment. I either need the rate frozen for a set amount of time or I need to modify my current loan terms.

Please get back to me as soon as possible.
Thank you for your time

[mar639]

I doubt ASc will go any lower than 7%. My teaser rate was 7.45% they modified to a fixed 7%.

[klsdallas]

Okay, so I had posted on here before about advice for getting a loan modification with ASC.
Well we got a call in early June from our negotiator saying that we were approved on the condition that we pay our escrow balance in September. He went on to say that we would go back to a 7.4% fixed rate on our first loan. (He was unaware that we had a second mortgage with them even though it was in all the paperwork we submitted). He said that we would be on a 3 month trial period with our new payment and then we would need to come up with $9,435 for the back escrows. He also said he would try and get us help with our second mortgage because it was a fixed rate at 9.8% but he needed to talk with his supervisor. That was the last we heard from him.
We got paperwork sent to us entitled "Special Forbearance" that did not state any of what he said in the paperwork. It did state that we had a trial period with no grace period to make our 2 installments of the new payment but then the last payment has a balloon of $12,000.
I called to set up our first drafted payment today for it to be taken out on Monday and I asked what the $12,000 went to in August. She said that was set up by our investor. If we are approved for the mod, then we don't have to pay that but if we are denied then we have to pay the balloon payment, which apparently has nothing to do with the escrows our negotiator talked to us about (the $9,435).
I am freaking out right now, because I do not feel that I fully understand what we just signed and now I come to find out that we may not even be approved for this modification and then have to make a balloon payment?
Any help would be really appreciated :-)

[Moe Bedard]

klsdallas,


We can only go by the experiences of the members on this board and the members that are on these types of Special Forbearances are still in the middle of making the payments.........

I guess the way to approach this is................if you were not offered any type of modification or trial period at all.............what was your next step going to be?

[klsdallas]

yes, and that is how we are trying to look at this, but I'm just trying to understand this $12,000 and where it goes....nobody is giving me an answer at ASC. Kinda shady if you ask me!

[Moe Bedard]

What would normally happen is, if you are approved for the modification then the balloon payment will be capitalized into the principle balance of your loan and that is what the new payments will be calculated off of......

[evel1999]

Sometimes you can get them to agree to a lower payment and interest rate than your initial rate, but you have to be very agressive. My initial rate was 8.25% payment $1750, I was able to get approved for a lower rate at 7.2% and payment of $1640. Savings of $100 a month. Not much but it sure helps.
So, ask for what you need and be very firm about a fixed rate. You sure do not want to have to be back in this situation again in a year or two.

Sounds like you have been given a trial period that they agreed to and you agreed to, paying the new payment for two months. Are they asking for the $12,000 to be paid in Aug before you can get the modification? Sometimes they will not add the back taxes to the loan, some require you pay that in full. Don't know what ASC policy is on that. Can you afford to pay the $12,000?

Hopeful, it is like you understand, and if the modification is approved, they will roll the $12,000 over to your balance and give you a Loan Modification.
They usually add in a payment or two also and your first payment on the modification is not for a month or two months. That may be why it is $12,000
and not the $9,000 and something you owe in back taxes. That is a lot of back taxes.

But, please check with your agent at ASC, and make sure that you can roll that $12,000 over, or you may have to pay that in full. But, if you have to add that $12,000 in, it is going to make your payment go up. So be prepared for that.

Let us know how this is working out for you. Hopeful, they will give you a fixed rate for the duration of the loan after this 2 month trial period.

[klsdallas]

Okay, thank you that was helpful! Has anyone been following the new government bail-out plan that senate is supposed to approve by mid-July? If this passes, and you are in the middle of a loan modification, can you still qualify?