Countrywide!! Modification approved!!!!

[shannonek]

Hello!

Here's my story....

Bought home 12/22/04 @ 325,000 in Palmdale,CA (The onetime foreclosure capital of the US in the 90's) on its way back to its former glory!

Wasn't too bright and signed into a 80/20. 1st @ 5.7, 3yr ARM w/6mos prepay pen. 2nd fixed 15yr ballon @ 9.875 also with prepay.

Well that prepay was a blessing and a curse. We were tempted at the idea of a cash out refi when our value had rose to $440G in little over a year. But the thought of losing over $10G didn't sit well. So we decided to just wait til Prepay expired to refi....big mistake...kinda. Had we refied the we most likely would have taken every penny possible and blew thru it on frivoulous things and most likely have gotten ourselves into another ARM. So there is the blessing. The curse is that we couldn't refi until 12/07....

8/07- Value now at 380! We were getting scared and decided to forget about prepay and refi into fixed. Ooops LO doesn't show up for appt. Back to original plan.

11/07- rolls around and we start the FHA process with the Aug appraisal....smooth sailing...until ICEBERG!!!! FHA requests field review of home and comparables. Value dropped by 50G! Now at 330,000.

I cant refi fha or conv. I have a 99.99999 LTV. Don't have 10G+ cash for closing costs. Loan starts adjusting 2/1/08 (up $600) then again in 6 mos.

Now I start the loan mod process. I have not 1 late on payment on Mortgage or bills.

676 mid fico
90G yearly income
Lots of foreclosers in area, tons of inventory, fast dropping market.

I called Countrywide Home Loans, they said that my loan was not originated with CW, therefore I would not qualify for a loan Mod. But sent me to the Home Retention Dept.
I sent in my hardship letter on 1/18/08.


My question is this....I know countywide is my servicer. But the loan modification dept said that Countrywide Home Loans was not the loan originator, but on further review in my note, Americas Wholesale Lender is my lender ...which is a name that CW "does business as" I am confused. Do I have a leg to stand on with this?


Sorry to ramble on,

Shannon

[Andrew]

You should call back and ask again. My loan was originated by lending tree and I was able to get a mod. I would also send a certified letter regarding this asking why you are unable to get a modification.

Your situation presents what is perhaps the best example of what I'll characterize as the borrower having the upper hand. I know that seems strange, but by not having any equity and not having refinanced, you stand in the position of pointing to the non-recourse nature of your loans and the fact that all the lender(s) can do is resort to foreclosing on the collateral (see California Code of Civil Procedure Section 580b).

The single downside risk to you is the hit you will take to your credit score in the event of foreclosure. The reality of the market in Palmdale is market prices are likely going to continue to slide. So why not use all of this information to your advantage and take a "I'm in the driver's seat" approach to your lenders, simply explaining that they need an REO in Palmdale like a moose needs a hat rack.

So I guess I might start with a simple approach to negotiations. That is, summarize the situation in a simple, understandable manner that explains to the lender(s) that the choice it theirs. You will either stop making payments and live in the property during the foreclosure period 'rent free,' or they can start playing ball in a manner that maintains the situation by lowering the interest rate in a manner that brings your PITI costs more in line with what the fair rental value of the property is.

Their downside risk is considerably more substantial than yours because they could be stuck with one more vacant REO in a market that comes about as close to a disaster as one could describe in this market. Maintain the attitude that you'd like to do the honorable thing and not default in your obligation but need help from them in achieving this objective.

Take care,

Daniel

[Moe]

Thanks for sharing your Countrywide concerns Shannon and you're not rambling. This isn't easy to figure out.

Good advice everyone. As far as whoever you talked to at Countrywide that said that to you, is BS. They have servicing authority that has pre-built loss mitigation capabilities to modify loans at will when a default is reasonably foreseeable.

I would keep calling and follow many of the Countrywide success stories for guidance and support.

[Mary Salzer]

What Moe sez, additionally given the stats that you have in your post you are an excellent candidate for Modification. Income strong - stability? FICO is viable, Location is not one that they would prefer to have another loss leader on their REO lists. Your pay history reflects willingness.

Stick to it, they are one in the same with respect to the fact that Country Wide Home Loans, America's Wholesale Lender, Country Wide Financial are umbrellaed as Country Wide, it was just the method of delivery, point of contact for origination of the loan for the borrower that defined who they were assigned to.

Send the hardship letter return receipt to all of the above parties, 3 times each, call, call, call. Get solid information and keep at it.

Demand a QWR if you feel or even if you do not fee that there have been issues not addressed in the original loan closing properly. In that QWR demand Life of Loan Payment History, all original Disclosure Docs, Note, Deed of Trust, all Riders, copy of original appraisal, TIL and Lender Copy of Final HUD-1. Put them on notice that you mean business and will be on top of this at all times. Make them work at retention too.

[shannonek]

Hello Everyone,

Thank you all for the reassurance! I spoke with a rep at Countrywide Home Loans today. My case is being assigned and I should receive a call anyday! They asked for a budget, and I am curious if anyone knows the ratios that they use are? I am at about 53 % of my gross incme for credit cards, car/personal loans and mortgage on home? Should I omit a few things or pad my expenses? I just want to make sure this goes through.

Thanks for any input!!

Shannon

[shannonek]

I spoke with a rep at Countrywide Home Loans today. My case is being assigned and I should receive a call anyday! They asked for a budget, and I am curious if anyone knows the ratios that they use are? I am at about 53 % of my gross income for credit cards, car/personal loans and mortgage on home? Should I omit a few things or pad my expenses? I just want to make sure this goes through.

Thanks for any input!!

Shannon

Recognize that the person on the other side has your original loan application, your credit report at the time you made the loan, your current credit report, and your new income and expense declaration. I'm suggesting being honest may be the way to go, particularly if the form they are asking you to submit that indicates income/expenses needs to be signed and just above it is some sort of statement that it the information is true and correct........

Daniel

[Mary Salzer]

Put your contractual obligations down as they are....exactly as they are, if you have a VISA Card with a balance of 3800.00 and the payment is 151.00 that is what you reflect. The Lender will be pulling another credit report for this process. The original 1003 reflects a snapshot of what was when you closed the loan, not what is today. If you job has changed or you have gotten a raise since, reflect that new rincome specifically - they are going to want your paycheck stubs and possibly your W-2's.

You have additional expenses - Utilities, Gas, Insurance, Food, Medical, Cable/Internet, Retirement Savings (they may not be fond of those at this point in time), any and all recurring monthly "stuff" that you might have that is necessary.

Do not short yourself, do not short them, average the utility bills so that there is parity for the year, same for groceries, and medical. The rest is fairly set in stone with a monthly set amount for the service. (You may have to knock out some of the better things in life - like cable to meet their standards) You have a goal here - get back in the track and on the track - Modification.

This is a good faith process, and must be initiated in that fashion, no they are not your friends (lender), but this is in their interests as well, so we need to play fair for the Mutual Interests served.

At all costs, stay focused and proactive in the process there is no magic formula - just hope and tenacity. If you feel overwhelmed, do not hesitate to contact the attorney on the site here - there is modification assistance through this site. Contact HOPE, a non-profit, they too have multiple tools for you to assist you. Above all - hope and tenacity.

[Mary Salzer]

State the real, they will pull another credit report. Income is different I am sure after the last review of income as nothing is what it was when it was initiated. They will want paycheck stubs and W-2's. Average the utilities for the year to a monthly figure, include all of your expenses....contractual consumer obligations, medical (scripts, etc...) averaged if necessary for the year to a monthly equation, gas to and from work, cable/internet, Insurances, etc..... The overall effect of this is to provide them a clear picture of what it takes you legitimately to live each month. This allows them to present the picture to others who ultimately make the final decision that this is a good "RISK" and that success is viable for both parties - the borrower and the lender - Mutual Interests. By the same token if you have too much left over, then there is the possibility that they are not inclined to do the modification as you are not in a Hardship position.

Report the data factually and be able to support it, ie. utility bills for 12 months, gas receipts, etc.....if you need to appeal any decisions that they may make that are not in your favor. Personally I prefer Residuals after Utilities and other costs are subtracted......VA methodology, they may get there soon - it works. Above all stay focused and strong and keep us posted.

[JacMac]

I agree with what Poppy and Daniel said, honesty is the best policy. Think about it, the whole process will be tainted if borrowers start to lie to get what they think they want. It will work out better for everyone if we're all honest.