Bank of America loan mod -SUCCESS!!

[Moe Bedard]

you can post the ones that helped from my list here..........

[LHarveyMadman]

The email addresses that I used were ken.d.lewis@bankofamerica.com, liam.e.mcgee@bankofamerica.com, maryellen.baker@bankofamerica.com, and barbara.j.desoer@bankofamerica.com.

[LHarveyMadman]

Well, I think I am now able to report success in getting my loan modified with Bank of America. I have been offered a fully-amortized 30 year loan with an interest rate of 3.25% for the first 5 years, after which it will go back up to 6.25% for the remainder of the loan. If I were to stay in my home for the next 30 years, it translates into a net effective rate of about 5.43%. I'm still waiting for the official documents, but I have been repeatedly assured that the modification has been approved and I should send in my new payment amount by January 1.

I'm completely happy with this modification. Funny thing, though, is that when I take into account the lower interest payments through the first 5 years and adjust my income tax withholding accordingly, I don't actually save that much money each month. Sure, my monthly mortgage payments are about $550 less, but I have to pay almost the same amount more in taxes. The big advantage to me is that I'll actually be paying down the principal, unlike my current interest-only loan.

My personal experience brings to mind two literary references: William Shakespeare's "Comedy of Errors" (for the title alone, not the actual plot) and a line from Henry Wadsworth Longfellow: "Though the mills of God grind slowly, yet they grind exceeding small." I'd make a small correction to that line: the mills of mod grind slowly...

[LHarveyMadman]

And by the way, thanks to everyone on these forums who provided me with the knowledge necessary to make this modification happen.

[Moe Bedard]

Congratulations on your Success!!

Please let us know when you receive the docs......

[LHarveyMadman]

Thanks, ***! You, in particular, were instrumental in making this happen. I'm sure you've heard that many times before.

I actually received modification documents over two weeks ago, but there was an error in the ZIP code that needs to be corrected, because these are the documents that will be recorded with the county.

I call this process a comedy of errors because there have been several small glitches along the way. I was actually told that the modification was approved about a week after I emailed my proposal (that is, in late October). However, the first offer I received contained an unexplained "mortgagor contribution" of over $10,000 that turned out to be an error. It took 1.5 weeks for this to be settled. Then the new offer letter did not arrive for over 2 weeks more; it was clearly lost in the mail and I had to call repeatedly to request that it be sent to me again. Shortly after I signed and returned it, I received the more official documents that contained all the fine print. This contains the ZIP code error, and I'm still waiting for the corrections to arrive. But nevertheless, the deal appears to be done.

I've been waiting to report my success because I didn't want to jinx myself (still could happen, I suppose), but I've been assured that modification is approved and final.

[HopingtoFind]

Congratulations on the Mod!

We are still are strugling with BofA.. we have 1st and Heloc with BofA (I know you mentioned that you couldn't do anything with HELOC).

I was wondering on your first how much of a surplus or deficit did you have on your income/expenses? We had some mistakes made by reps when they took information on the phone, which we corrected and at this point have $50 surplus. Freddie is our investor on the first. Analyst took our information and said that he'll get back, but never did... I wonder if $50 is too much of a surplus and we need to have a deficit.

Also, did you try and call the executives you emailed? If so, which numbers did you call? Thanks for your help.

[LHarveyMadman]

Hi Hoping,

I'll have to check what numbers I gave them - they're in my office and I won't be back in until Monday - but I'm fairly certain that I had a surplus in excess of $200 with my current payments.

The issue that I was facing was an ARM reset of my interest-only loan that would have started to include principal payments amortized over 25 years instead of 30. Based on my index and margin, at the time my loan modification was first considered, I was facing a payment increase in excess of $1500. Even though the reset was still a couple years away, I had real concerns about my ability to either afford the payment or refinance the loan because of the tightening credit requirements. Obviously, this concern was valid to them, because they agreed to modify my loan.

Ironically, if my ARM were to reset right now, it would go down to about 4.75%, because the LIBOR has dropped along with short-term interbank lending rates across the world.

I never had to call any of the executives. About a week and a half after my email went out, I got a call from an analyst who took my information and guided me through the initial phases. Unfortunately, she is no longer working in the loss mitigation department, so I cannot refer you to her.

Good luck with your endeavors.

[HopingtoFind]

Thank you LHarvey,

I appreciate the information. Initially rep had our surplus at $400 and were saying they couldn't modify, we adjusted it to $50.. I guess we'll keep calling our analyst and see what happens. We have interest only as well..

[LHarveyMadman]

HopingtoFind, the way I made my case is by focusing on the future payments, not the current payment and current surplus. I highlighted the fact that because of credit market uncertainty, there was no guarantee that I would be able to refinance my mortgage when the first adjustment arrived. So it wasn't a current hardship (which I admitted in my letter) but the risk of a future hardship.

Also, I believe that modifications are also made based on the lender's opinion about the borrower's future ability to pay. If the lender gets the sense that even after a modification the borrower is still at risk of default, they may deny the modification because they feel that the ultimate outcome will be the same. There's reports now that half of all borrowers who received modifications are in arrears again, and the lenders are probably becoming more selective about whom they offer modifications.

[HopingtoFind]

Well we had some good news today! A lady from Bank of America called and said that they will be reducing our HELOC payment (this is on a different property) by 75% and we should receive documents in the mail shortly. The amount of our HELOC is $90,000k and I think it should reduce the payment by about $300. This is of course a current hardship for us and the $90k if pretty much unsecured as the value of the property is at most what we owe on the 1st.

I think this was as a result of emailing the executives at Bank of America.
Now I am thinking I should have mentioned the 1st and 2nd on this property as well...

[mmohammed]

Hello LHarveyMadman

Thank you for the info you have provided. I am trying to help my parents with a mod. their loan is with wamu but the investor is bank of america. their mod was denied. was your investor also bank of america? i wanted to send emails to the addresses you listed to see if it would do any good. would you mind telling me what your montly deficit would have been. my parents are currently making about 1600 less than what their payment is do to one of them being laid off.

[LHarveyMadman]

I never found out who the investor was on my loan. At the time of the modification, I was not running a deficit, but when the interest rate resets and the principal is amortized over 25 years, it would result in a deficit. I can't recall the exact number (I had factored in probable pay raises and future expenses), but it was somewhere in the $300-$600 range.

If B of A determines that even with a modification your parents may not be able to make their payments, then they might deny the modification. $1600 is a pretty massive shortfall, and it might be hard to find a modification that drops the payment enough. But it doesn't hurt to try. Good luck.

[HopingtoFind]

mmohammed, I think deficit you're showing is to huge, I would suggest to try and eliminate some expenses and/or to increase income and resubmitting again with Wamu..

[modneeded]

I got a fixed loan two years ago for 6.875% interest for 30 years from B of A. My old monthly payment was $6,305.32. My income s about half of what it was two years a ago. B of A also reduced my HELOC from $150,000.00 to around $38,000.00 (The amount I owed at the time) last year (without any notice) and when I questioned why they told me the value of my home was only $480,000.00 instead of the $1,150,000.00 paid for it. Not having my HELOC really hurt my business. I phoned that phone number at Bank Of Amerca to get a loan modification about one month ago. They sent me loan documents today without speaking to me and they only reduced my loan payments to $6,115.53 per month but increased my loan to 33 years. My loan was already two years old and now they want to add 5 years to my original loan at a cost of $6,115.53 x 36 months for a total of $220,159.08. I thought they were supposed to help the homeowner but apparently B of A wants to put me into further debt. This loan modificaton that they offered is a joke and they should be sued for trying to take advantage of homeowner. I love my home and I have been a customer of B of A snce 1985. The FED needs to cut out the banks and give us the same 1/2 percent interest rate they are giving the banks and this recession would be over. The banks take taxpayer's money and then rip us off for more money when we ask for a loan modification. I now have to start the process all over again to see if I can negociate a better deal. HarveyMadman, I am going to try and email the people you did to see if I can get a similiar rate. Thank you again for the informaton that you have posted on this forum.

Originally Posted by LHarveyMadman

I never found out who the investor was on my loan. At the time of the modification, I was not running a deficit, but when the interest rate resets and the principal is amortized over 25 years, it would result in a deficit. I can't recall the exact number (I had factored in probable pay raises and future expenses), but it was somewhere in the $300-$600 range.

If B of A determines that even with a modification your parents may not be able to make their payments, then they might deny the modification. $1600 is a pretty massive shortfall, and it might be hard to find a modification that drops the payment enough. But it doesn't hurt to try. Good luck.

[LHarveyMadman]

modneeded,

Based on what you wrote, it appears that you owe $1 million on a house valued at less than $500,000. This is a terrible situation for you.

Being upside down by so much, even if B of A were to offer you a modification that cut your interest rate in half for the life of the loan (a highly unlikely scenario), after 10 years you'd still owe about $750,000. Even when the housing market recovers - and it will, in time - I suspect that you'd still be upside down at that time. You'd effectively be a renter during this time, not building up any equity for the first 10 or 15 years of the life of the loan.

I agree that the loan modification documents that they sent you are rather poor. I wonder if they felt that even with modification you would be at risk for default anyway (you mentioned a large loss of income), and thus did not put a lot of effort into finding a viable solution. But like I said, I don't know if a viable solution exists short of a massive write-down of your principal.

I know that you love your home, but given the formidable obstacles you face, you should be exploring options that would get you out from under this massive debt, e.g. deed-in-lieu. Even if your income recovers in the near future, the reality of your mortgage debt vs home value will remain, and you'll have to decide whether it's worth it to pour hundreds of thousands of dollars into your home before gaining any equity.

I feel really bad for you. Where do you live?

[modneeded]

LHARVEYMADMAN

The house is worth the same as I paid five years ago, I had it appraised one month ago. My income would still qualify me if I got a 3 or 3.5% loan. I lve in Southern California. Thank you again for the advice.

[LHarveyMadman]

modneeded, sorry about the misunderstanding. I wonder why there is such a disparity between B of A's appraisal and yours. Just be aware that lenders often do not accept appraisals done by agents other than their own. Last year, I couldn't get US Bank to accept a higher appraisal done by B of A.

Anyways, B of A does have a step-rate loan, such as what I was offered. My rate got cut for 5 years, after which it reverts back to the original rate. The major difference between our situations is that I had an ARM that was converted to this stepped fixed-rate loan. I don't know if they are paying much attention to those who have fixed-rate loans to begin with. But maybe contacting those execs will produce some results.

Good luck from a neighbor to the north.

[modneeded]

LHarveyMadman,

The appraisal was done by B of A when I disputed them lowering my Heloc so I guess that should not be an issue. I will take your advice and write to those executives that you listed. I am just amazed that they are making offers to homeowners that make them even owe more money. I understand you sent a hardship letter. What else should I send them? Thank you again for your help.

modneeded

[LHarveyMadman]

The lenders who are offering modifications are trying to lower the monthly payments while protecting their investment. For many people - me included - this includes extending the term of the loan. For those people who have missed payments, they are adding the unpaid interest and fees to the principal, which also increases the total amount paid over the life of the loan.

Your offer is similar, in the sense that your monthly payments have been lowered. That is the bottom line for the majority of borrowers. It buys them some breathing room in the near term. In your situation, if you are unable to get a better modification and if your income recovers soon, you are welcome to voluntarily increase your monthly payment to the previous level. This will change your amortization schedule and shorten the life of the loan. You would save the thousands of dollars you would otherwise spend if you kept your loan for its entire 33 year term.

[LHarveyMadman]

modneeded, I did not send anything other than my hardship letter. When they called me, that is when they requested detailed information about expenses and other financial obligations.

Most people would recommend keeping the letter short and direct, but I did not see that advice until after I had sent off a fairly lengthy and detailed letter. In my letter, I summarized my loan terms and stated my concerns (interest-only ARM, unable to refinance due to insufficient equity, concern about reset and increase of payments). I suggested a specific modification that I thought would be advantageous to both parties, though in the end they gave me a different but equally attractive modification.

At the end of the letter, I included a paragraph telling them a little about my family and me. I felt that it might help if they got to know the people behind the mortgage. I have no idea whether this had any bearing on the decision to modify my loan, but I like to think that it made a difference.

Good luck.

[surfdoggy1234]

Now that CW is owned by BoA, can we use the above BOA contacts for a loan serviced by CW??

[Moe Bedard]

The servicing of the loans are still being kept separate.........so you would need to contact CW Home Retention...........

[Woodland Hills Worrier]

I was drawn to your post by similarities in your story and mine. We re-financed a home we purchased in 1995 in 2006 with the intention of re-financing in January 2009 after our three-year pre-payment penalty expired. Of course, we did not anticipate the current collapsing housing market. We are now underwater, upside-down, whatever term applies. I have contacted Countrywide to start a loan modification process as our loan falls within those covered in the settlement agreement that Bank of America agreed to with the California Attorney-General's office. I have been told either than I do not qualify as I am not deliquent or that the program has not begun due to delays on the side of the government. Yesterday I spoke with someone from the Home Retention Department who advised me to fax recent pay stubs and a letter explaining our financial situation to Countrywide.
We are making payments on time or a couple of days late and it is getting harder and harder. My wife is becoming increasingly anxious about losing the house. Still cost of living expenses have increased. We were able to use $30,000 of family money last year to keep afloat but that money is no longer available. My wife and I both work and have secure jobs and earn a montly net income of $11,000.00. We have a second mortgage, car payments, etc. We just break even. The most important fact, I suppose, is that we have been paying less than interest only in the expectation of refinancing, but now that seems improbable and it won't be long before we are in a situation where we will have to pay a substantial, more than we can afford payment. I hope you can advise me with your expertise and experience on what I should do. I intend to send in the info to Countrywide to see how they react, but what do I do if they claim I do not qualify? What is the consensus on the plans of the new Obama administration? I would appreciate any feedback or guidance. Thanks in advance.

[tarps14]

Woodland Hills Worrier-if I may be so bold, it might be a better idea to start your own new post rather than attach your situation to one that is already listed in the "success" column. I'm afraid it might get overlooked here and you want to make sure you get the help you need. I'm sure *** or someone will be along shortly after you start the new post to answer your questions. Just look for whichever mortgage company you are with and start it there. Good luck to you!