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OCWEN Loan Mod Process

Discussion in 'Loan Modification' started by indig0blue, Feb 11, 2009.

  1. indig0blue

    indig0blue LoanSafe Member

    Hi Everyone,

    I have been reading people's posts and have found a lot of hope in them that I might be able to get out of my own situation.

    I contacted OCWEN in November of last year to inquire about a loan modification. I have a 3/1 Interest Only ARM that has an adjustment scheduled to start on June 1, '09. I was told that nothing can be done until the adjustment is calculated which takes place in March. My concern is that if I wait until after the adjustment is calculated in March then that only gives me 2 months to start the process of the loan modification and hopefully complete it before the June 1st payment is due.

    What is the best course of action here? I have never been late on any payments and don't want to make a late payment because the new adjusted payment will likely be too expensive. I have been told that the increase will probably be around $700. That will be impossible for my wife and I.

    I am trying to be proactive here in contacting OCWEN and do the loan modification before the new payment is due, but it sounds like that is not what they want to do.

    Can anyone offer any help or insight on this?

    Thank you so much.

    - indig0blue
  2. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    Re: OCWEN Help! Need Loan Modifcation

    Hi indig0blue,

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

    You would need to begin by putting together a hardship letter..........

    These are what most lenders consider to be generally acceptable hardships....
    1. Loss of job or reduction in income
    2. Death of the homeowner, spouse or family member
    3. Illness of homeowner or family member
    4. Divorce or separation
    5. Forced job relocation by employer
    6. Adjustable rate reset-payment shock

    The best way to set up a hardship letter..........

    * First, describe the hardship and the circumstances that caused it
    * Explain what steps have been taken to correct the situation
    * Provide the lender with your plan to get back on track and stay there
    * Assure the lender that you are a responsible homeowner who just needs a second chance and that you are very motivated to save your home

    Here is a link to some examples for you..........

    http://www.loansafe.org/forum/loan-modification/135-examples-hardship-letter.html#post407


    then go to this link for Ocwen and it will direct you from there.........

    *Foreclosure Alternatives
  3. deniseb

    deniseb LoanSafe Member

    Re: OCWEN Help! Need Loan Modifcation

    Hi indig0lbue - Don't wait until you intrest rate adjusts. Is there anything that has changed regarding you income and/or expenses? I would suggest you call and request a loan modification now.

    I have Ocwen for my 2nd mortgage. I submitted my information online - then I heard nothing. When I finally called and spoke to a live person, my financials were taken and he helped me "remember" my payments and obligations so that I could get the "right" figures for a modificaiton approval.

    I think the representatives are authorized a little bit in approving modifications or something because it was just too easy.

    I was given a reduction in interest from 11.75% to 2% for 5 years. Since this is my second and it was interest only - it save me $170+ per month.

    One thing to remember is that when reviewing my expenses, Ocwen didn't want to count my minimum payments on my credit cards. The rep says that they consider that money that I got and am paying back - basically a wash.

    He didn't ask for any verif of expenses and I have a baby under 2 whom I pay a lot of child care for.

    All they verified was my income via paystub and checking account. I had to write a statment regarding child support income I receive.

    Get your bills together and do a budget first. Be prepared before you call them. You may want to go to the HOPE website and do a mock budget first. Do not click submit just in case it's not adding up correctly. Good luck!
  4. indig0blue

    indig0blue LoanSafe Member

    Re: OCWEN Help! Need Loan Modifcation

    Thanks for the information. This really helps to get the ball rolling.


    One question...

    What if my debt to income ratio is really bad? (around 70%)


    Will that disqualify me from being able to have a loan modification done?
  5. Dan Bailey

    Dan Bailey Senior Member

    Re: OCWEN Help! Need Loan Modifcation

    indigoblue,
    The modification is up to the investor behind the mortgage, there is no telling what they are looking for, each case is different.
  6. indig0blue

    indig0blue LoanSafe Member

    OCWEN - LOAN MOD - Paperwork Question

    Hi Everyone,

    I am in the process of getting all of the paperwork together in order to submit to OCWEN for a loan modification.

    I have seen some great hardship letters on the site from which to draw from.

    My question has to do with "Exhibit A" which is the monthly budget worksheet. I have read a lot about how much should be targeted for in terms of surplus at the end of month. I am not sure if I should be keeping some surplus on the budget or not.

    My other question has to do with claiming credit card debt. The form only has two slots for credit card payments but unfortunately I have many more. If I only claim the two credit card payments I have around $400 in surplus. But if I were to add in all of my credit card payments then I would be more like $350 in the hole at the end of the month. I have been paying some bills with credit cards which has helped to sustain our family each month. We are now at a point where we need to get the loan modification done in order to balance things out.

    If anyone has any advice or tips on how to approach the budget worksheet, I would very much appreciate it. I was thinking about attaching a separate page listing all of the credit card bills I have but I didn't want to do anything out of the ordinary with my application. I have gotten the impression from experiences described on this board that any small anomaly causes an application to get disqualified.

    Let me know what you all think.

    Thank you.

    - indig0blue
  7. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    Re: OCWEN Help! Need Loan Modifcation

    We can not offer advice or guidance on financials..................as there is no way for us to know what the investor guidelines are for modifications............you would need to give proper income, and expenses, they will be looking to make sure that you can support the mod-- and most will verify info by checking your credit.

    If some help is need with the budget sheet......you can ask HOPE for help with this........they will be able to put together a budget to submit to Ocwen....1-888-995-HOPE
  8. River_Brat

    River_Brat LoanSafe Member

    Re: OCWEN Help! Need Loan Modifcation

    Indig0 -

    I have my 1st and 2nd with Ocwen and feel your pain. My first is an ARM and is scheduled to reset 4-1-09 and according to the schedule in the loan documents, the payment was scheduled to increase by $700.

    We just got the official rate increase the other day and the payments only increased by $65. I can't believe it!!

    I haven't officially submitted my financials to them yet because I was waiting to see if the new Obama plan would help us out or not. Now I don't feel like it's so urgent and I'm not going to be forced to accept Ocwens crappy terms just to avoid the reset.

    I wish you luck!
  9. indig0blue

    indig0blue LoanSafe Member

    Re: OCWEN Help! Need Loan Modifcation

    River,

    Wow! That is great news. It gives me hope that maybe my payment won't go up like crazy. I had this number of $700 because that is what I was able to get out of the OCWEN rep as a rough estimate. I heard anywhere from $300 to around $700.

    What are the terms of your ARM? Mine is a 3/1 interest only loan for $290,000. I then have a second mortgage (fixed loan) for around $75,000 to cover the house that I bought for $365,000. The ARM is scheduled to have its first adjustment in May. And then every 6 months after that. The payment adjustment review is scheduled for March so I should know by the middle-end of March what the increase is.

    Could you let me know if my terms are similar to yours as far as the terms of the ARM and the amount of the loan? I just want to see if I am in the same ballpark and if I might have a chance to get as lucky as you did.

    Now, let me play devil's advocate here. (And with OCWEN, I do mean devil.) Do you think they are being "kinder" with their ARM adjustments in hopes that people will just stick with their current ARM and then OCWEN can hit later on at some point when Obama's plan runs its course? I mean, from what I was able to understand from the Obama plan is that my loan could be modified so that the payment does not exceed 31% of my income for the next 5 years. Obviously details are still being finalized, but assume that is true for the moment. If OCWEN believes that is the case, then maybe they are saying, "Hey, let's give our customer modest increases to avoid taking bigger hits for those choosing to use the Obama plan." I understand the Obama plan is voluntary for servicers but I think a company would be crucified for not participating so maybe OCWEN wants to minimize the damage by getting customers to stick with their current mortgages by giving them smaller payment increases.

    This is all just a theory. I really have no basis for it other than my jaded outlook on this whole environment. I just want to keep my house and I have to only pay $65 extra each month or I am able to save $400 each month, I don't really care.

    I look forward to hearing from you again River. You have absolutely given me a ray of hope as my ARM gets ready to be adjusted.
  10. indig0blue

    indig0blue LoanSafe Member

    Loan Mod - Obama Plan - 31% Based on what??

    Hi Everyone,

    When I bought my house, I was given two mortgages. The total value of the house at the time of purchase was $365,000. One mortgage is for $292,900 and the other is $72,089.

    The mortgage for $292,900 is an interested only ARM that is scheduled to adjust in a couple of months. This is obviously the mortgage that will need to be modified.

    My question is in regards to the Obama housing rescue plan. The plan says that they will support loan mods that get the mortgage payment down to 31% of monthly gross income. Based on the numbers above, does the rule only apply to making sure that the $292k mortgage payment is at 31% or does the plan call for that $292k mortgage payment to get to a percentage so that when combined with the other $72,089, the total payment does not exceed 31% ?

    My concern is that even if they get the ARM mortgage to 31%, my total mortgage payment each month will still be rather high and may have room to go up a bit before meeting the 31%.

    I really hope I have explained my question well enough. Let me know if I can explain any part of it further.
  11. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    Re: Loan Mod - Obama Plan - 31% Based on what??

    the program is working to get the mortgage payment on the first to the target of 31% of gross income...........

    there are incentives in place for a participating second lien holder..........but you would need to ask if they are participating....

    Second Liens: While eligible loan modifications will not require any participation by second lien holders, the program will include additional incentives to extinguish second liens on loans modified under the program, in order to reduce the overall indebtedness of the borrower and improve loan performance.
  12. indig0blue

    indig0blue LoanSafe Member

    OCWEN Loan Mod - Hardship Letter Feedback Needed

    Hi Everyone,

    I am ready to submit all of my documentation to OCWEN in order to start the loan modification process. I wanted to get some feedback on my hardship letter and see if people generally think it is ok.

    Thank you in advance for any feedback or opinions.


    HARDSHIP LETTER-

    My wife and I had a baby last year which resulted in her having to reduce her hours at her job thus reducing her income by half. My intended plan at the point of having our baby was to be more aggressive in paying down debt so that we could improve our credit scores in hopes of refinancing our mortgage ahead of the ARM adjustment. What we found though, was that the expenses of caring for a baby in addition to our 11 year old coupled with my wife’s reduced income, resulted in both of us using credit cards to pay bills so that we would always have money available for our mortgage payment. We have always believed that no matter what happens we always want our mortgage to be current. This is why we felt we had to use credit cards to pay for expenses such as utilities, gas, and food.

    In anticipation of our ARM adjustment which is evidently supposed to raise our mortgage payment anywhere from $300 to $700, we have cut out almost all of our prior disposable expenses. We no longer eat out, go to Starbucks, go to movies, or buy anything else that may be deemed as frivolous. Our goal here is trying to get all of our expenses paid out of our income so that nothing is being paid out of credit cards. I have also started to make attempts to find part-time freelance work in order to start paying down credit card debt in order to further get our heads back above water.

    We have slowly moved back to paying for expenses through our income but despite even the best efforts made by myself and my wife to save and cut costs, we won’t be able to survive a potential mortgage increase of up to $700 every six months. Eventually, we would have to consider options such as foreclosure although this is absolutely the worse case scenario. My wife and I are very hopeful that your company will be able to assist with an alternative.

    This has been a very stressful time for my family and trying to find viable solutions have been challenging. My initial plan was to refinance the home when the adjustment date came up however given the economy it is just not possible. I had reached a very hopeless point and didn’t think any options were going to work. Since then however, we have made up our minds that we want to fight and not let our home slip away. This is my driving motivation for trying to get freelance work lined up. I know that if I work hard enough that I can keep my family in their home. That is all that I want to be able to do. I don’t care how much sleep I lose if it means that my family can stay in their home.

    Like many families across this country we have evaluated our lifestyles and have made many adjustments in order to get back to living within our means. It will take a lot of discipline but we are confident as a family that we will pull through this. All that I am asking for is an opportunity from your company to help us keep our mortgage at a manageable level so that we can survive.

    Thank you very much for your consideration.
    <O:p</O:p
  13. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    Re: OCWEN Loan Mod - Hardship Letter Feedback Needed

    it looks good...........:)
  14. indig0blue

    indig0blue LoanSafe Member

    I submitted a package for a loan modification with Ocwen about 2 weeks ago. I knew that it would be around a 10 day wait and have been calling in the past few days to check on status.

    I found out today that there was a delay because my tax returns did not have signatures. I thought this was odd because they ask for a signed form giving them permission to request my tax forms. That form was signed by my wife and I. But since I did my taxes on TurboTax there were no signatures on the actual 1040 return that I included in my package.

    I was told to resubmit with the signed 1040 which I have done and already faxed back to them. What I was told though, was that this would reset the clock and it would be another 10 days before I could check back on status. Is there any way to get around this second wait? Both my signature and my wife's signature were on all of the other necessary forms so I don't understand why this would be that big of a dealbreaker.

    Does anyone have any advice on this? I don't want to have to wait another 10 days to see if my loan mod goes through. My payment goes up $400 June 1st and I am running out of time.

    Thanks everyone.
  15. indig0blue

    indig0blue LoanSafe Member

    Has anyone had Loan Mod success with OCWEN?

    Hi Everyone,

    I wanted to see if anyone here has a had a positive and/or successful experience with OCWEN. That is who my servicer is and I am currently under review for a loan modification.

    I read the article below which is a bit encouraging but I am trying not to get too optimistic. The summary of the article is basically saying that OCWEN is whole-heartedly embracing the Obama plan and they are doing everything they can to keep people in their homes.

    Ocwen, Leading Subprime Mortgage Servicer, Begins Modifying Mortgages Under Government's New Program

    Has anyone else had any success with them?
  16. Shayster3570

    Shayster3570 LoanSafe Member

    I am working with them as well... I have a post "Is a mod going to help with this?" I TOO, had the "clock" reset. VERY frustrating!
  17. Doris

    Doris LoanSafe Member

    Greetings all! I submitted an 'Obama plan' modification request to Ocwen on 4/01 and have been wondering how and when I'd hear something. So I was dismayed when I happened to call this week re:another matter, and when I asked about the mod request I was told my tax return didn't have a signature on it. Like, when exactly were they going to notify me?! And not true, btw, but I dutifully resubmitted a legible copy.

    Now, keep in mind they're simultaneously moving forward on foreclosure and supposedly looking at this mod, so it feels like there's a time issue here. At least to me, the freaked out homeowner. So yesterday I got online and found this forum, which is great, but when I saw indig0blue's comment about the 'unsigned' tax form I got a cold chill. Is that their way of buying time because they're being deluged by requests? Once they receive a request do they have a certain timeframe in which to respond - I'm not aware. If not, why would they create roadblocks like bogus unsigned tax forms when they can just sit on them and not respond - which they do pretty well.

    I feel like I'm in pretty good shape because I'm not upside down on my home and it's not more than I can afford, but not at the 9.85% they locked me in at a year ago. I've been struggling mightily with that for months, but this year I stopped receiving child support due to job loss and that knocked the wheels off the wagon.

    Given all this, do we really think they'll move forward on foreclosure before 'ruling' on their own modification request? I'm thinking ahead to plans B and C - lawyer up on the mod, forestall with bankruptcy...???

    Thanks for any words of wisdom or consolation!
  18. indig0blue

    indig0blue LoanSafe Member

    Re: OCWEN Loan Mod Process - DENIED!!!

    Hey Everyone,

    I found out today that I was denied a home modification under the Obama plan and also under the Ocwen modification plan that they are also doing.

    It is extremely frustrating because I can't even tell if the person I was speaking with understood what he was saying or what I was saying. It is very un-nerving to having your financial life hang in the balance of someone who doesn't speak english. In any event, the main source of frustration was the fact that pretty much everything I had asked them about in the past and confirmed to be true seems to no longer apply. For example, I asked if they would be considering monthly credit card payment obligations and they had said YES. I had asked before if they would be considering the fact that my payment is going up $400 in June and not just base their decision on what my current payment is and they said YES. It turns out that they DO NOT CONSIDER CREDIT CARD PAYMENTS, and they DO NOT CONSIDER YOUR NEW ADJUSTED PAYMENT. They told me to just reapply in June. I told them that I am not going to be able to make the payment and likely have to file bankruptcy and he just stone-walled me and said "We cannot help at this time. Please contact us in June if you cannot make your payment."

    I was really starting to get a good feeling about the whole process because not even 1 week ago, someone told me that my financials were approved and that all I had to do was submit a copy of my driver's license and a copy of a utility bill. But he said that was just a paperwork formality and upon receiving it someone would be contacting me with our modification offer. They also repeatedly told me on a number of different phone calls not to worry and that they usually find a solution for all of the customers who ask for a modification. Now, I don't know if some idiot just went off script during the phone call or something, but to me it is really insensitive to instill that kind of hope in someone just to wrap up the phone call on a positive note. Myself, like many here going through this surely hang on every word and tone of the CS person and when someone says that everything is approved and someone will be calling me next week with their modification offer, I felt a tremendous amount of relief. I remember almost getting emotional telling my wife the great news that we were finally going to get out of this mess, I called my mom to tell her we were going to be ok, etc. But it was all in vain because of the CS people who work for Ocwen are just reading off of scripts.

    I am at a loss as to what to do at this point. Should I move forward with Chapter 13 or are there other avenues to pursue? I am not looking for any major break on my payments. I would be happy to keep the current payment I have. I just can't afford for the payment to keep going up every six months.

    I am considering putting together a well thought out letter to the execs at Ocwen and see if that gets any traction. I just don't know what to do. I don't understand why I should have to get behind on my payments before I can try and get a modification. The CS person told me I had $2600 left over after my expenses and that I had more than enough to handle the payment increases. This infuriated me because I simply don't have that. We are barely getting by and will go underwater as soon as the payment adjusts.

    If anyone has any insight or advice, it would be much appreciated. I think I am at the point of being desperate.

    - indig0blue
  19. Hopefull2009

    Hopefull2009 LoanSafe Member

    I'm sorry indigO - Were you given a reason it was denied?

    I sympathize and identify with that cheerful prior customer service rep who really made you feel it was all good. I went through a similar situation with my company (Aurora). Made be believe that after my 3rd successful payment on my second mortgage at 13.75% (ouch, I know) that they'd deal with the arrearage and "let's get that rate down for you." Well, during the mod process I could not make a payment because technically the balloon payment was due. I'm thinking it's okay because the nice customer serv rep told me it was all good. Well, 63 days later I find out I'm denied because I can afford it. They don't take increased payment plan (on first) into account - it's all based on the orig loan numbers. So now instead of 4 months behind, I'm now six months behind.

    I did call on another matter today and inquired once again about the obama plan and miraculously I was set up in the system, told my invester is participating and I'd make 3 trial payments (submitting the paperwork with the first payment) and then the modification after that. I'm scared to death because this technically "broke" the payment plan I was on (this is on the first mortgage) and if they pull another denied I'm sunk. After reading your story it makes me even more hesitant now to believe this is going to work out.

    Did they say why you didn't qualify? Was it income - too much?

    Chapt 13 lurks in my thoughts too but this whole process is so frustrating and mentally draining it's unbelievable. Who'd have thought this program by the government would cause so many headaches and I really believe a lot of it is the front line customer service people not having any concrete knowledge of what the heck they are doing.

    Hang in there and know you're not alone!
  20. Doris

    Doris LoanSafe Member

    Re: OCWEN Loan Mod Process - DENIED!!!

    Just an FYI that I finally heard back from Ocwen on my modification, and although I 'qualify' they're certainly not giving away the farm, despite the huge success stories you read about. They dropped my interest rate from 9.85 to 8.375, which is disappointing when you hear of adjustments below 5%. Other than that it looks like their standard modification, where they roll past dues and fees into principal and reamortize. Consequently my balance keeps growing and I'll be 97 before it's paid off, but my payment has decreased a couple hundred bucks. I'll take it for now just to buy time. Oh, and I'm making 3 'trial' payments also, at which point they'll supposedly waive all late fees.

    They required very little documentation from me on this... never spoke to anyone beyond the customer service reps, of course. So no gathering of monthly expenses, etc. I'm wondering if they gave so little because they think I can afford it or because I'm deemed such a risk. Either way, dealing with this shadowy bunch feels like doing business with the devil... you just know you're going to pay a heavy price.

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