Home Loans and Support

Divorce, Loan Modification and Loan Assumption

Discussion in 'Loan Modification' started by Momof4kids, Feb 2, 2010.

  1. Momof4kids

    Momof4kids LoanSafe Member

    Okay, I am seeking all of the wisdom from this great sight. I have learned much but still, I am not quite sure what the outcome will be.

    First, My husband and I are getting a divorce. I was a stay at home mom with a part time job (Realtor) making very little. When the divorce was filed, my husband stopped paying the household expenses. I called Citimortgage, and our other lender, Harris Bank (2nd loan) and was advised like many of you to wait until we were at least 3 months behind. (Harris, not so lucky...nothing set up for 2nd loans that arent' GSE banks - at least not yet they say).

    Okay, so I call in September and I am accepted into a trial loan modification. Part of my qualification was child support/alimony, and since I didn't have a court order yet, I was to wait until I did and submit all of my paperwork at once but to continue to make all my trial payments. Court delay, Court delay, etc. Finally received court order and submitted all of my paperwork to Citimortgage in December (12th to be exact). Now, I must add, I was told by some reps to submit a Quit Claim Deed (which I have; signed and recorded by the court), but the last several said to hold off b/c it isnt' necessary. What to do, what to do???

    I am in underwriting now, and I just received a packet (regular mail Feb 2nd) for a Loan Assumption Application. The process says it will take 90 days. Does that hold up my Loan modification? Do I have to wait until the Loan Assumption is complete (90 days) or does my underwriter - unknown name as of today - just need to see that I have submitted the forms? AND??? Does it matter that my credit is wacked now that I have been late on Mortgage 3 months and modified payments for 3 additional months?

    OOH!!!! I failed to mention that there is a $900 NON-REFUNDABLE FEE associated with this Loan Assumption. I would really hate to pay that (fee must be paid at time of application) and find out that I no longer qualify for the loan modification.

    Any and all advice is appreciated. Also, if there are suggestions of whom and what I should ask at Citi, that would be great.

    If we don't have eachother to lean on, who do we have??
  2. Momof4kids

    Momof4kids LoanSafe Member

    Okay, so I spoke with 4 different reps at CitiMortgage (my favorite was David, funny, polite and seemingly empathetic). All had the same reply: The loan modification will continue...and 1 rep (Tina) suggested I wait to hear that I have been approved or denied before sending in the $900 Fee.

    In addition to that, I have found the sample NPV test, plugged all my numbers in, and god willingly, I will pass. Unless, they have the PV (present value) of my home higher than what I think it it. (I am a Realtor). I have been running continuous CMA's and hope that the BPO comes in near my numbers. I gave a $30,000 value range higher as well.

    I also found many documents (I have so many printed informational packages now) that I can share with my friends and clients. 2 months of heavy internet research and I think I have all of the answers.

    The only information I couldn't find - maybe someone out there knows - is the REO Stigma Discount and Home Price Appreciation Forecast per state/region/county? I used an average for my NPV test input.

    So, in summary, if your NPV Test shows a larger loss (Zero Cure PV Loss) than your Modification PV Estimated Loss (given your redefault rate is under 50%), you will pass. It's down to the dollar too. It's pass or fail. No one evaluates the numbers, it's just a grade result and the underwritter goes by that. These PV numbers take into account all of the expenses, amortizaion etc to come up with the bottom line for each.

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