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Question regarding modification we just recieved.

Discussion in 'Loan Modification' started by bmjm1025, Dec 17, 2010.

  1. bmjm1025

    bmjm1025 LoanSafe Member

    My wife and i just received a modification through our mortgage company. Our servicer is Ocwen. We had been trying to work with them for a while and were getting no where. We had reieved a modification a couple years ago and were happy with the payments just hit a rough time. After being denied a repayment plan they began working on a modification. Last week we received the offer and could not believe what they were offering us. The total debt on our loan was $129.487.60. This new modification stated "The new principal balance on your loan will be $57,078.64. With an interest rate of 2%. Our payments are $448.68 and were originally $651.xx. The mod docs stated were were to sign and have our first payment in by 12/15 which we did by the 12th.

    My question is this:
    On their website on our account it has stated all paperwork was received with payment, and it may take up to 1 billing statement to reflect the new modification agreement.

    Now their website states:

    Account Updates: Your loan modification does not qualify under the Home Affordable Program guidelines. We urge you to speak with one of our representatives, to work out an alternate Resolution.

    Can they go back on a loan mod after we have signed and submitted payment?
  2. Maurice Bedard

    Maurice Bedard Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    Is it possible that there is a forbearance amount or some principal writedown? I would ignore all the phone calls, and emails and website info, and wait and see what happens. If an error was made, they can retract it. But if I was you, I would watch the mail for a statement, and stay off their website. In the meantime, save up some cash because you will probably owe back the difference in payments.

    If they made a mistake, they are suppose to send you a corrected offer.
  3. bmjm1025

    bmjm1025 LoanSafe Member

    Im really not sure about the forbearance amt, but there was a huge principal writedown.

    Below is the mod agreement.

    Only thing i have deleted is our address.

    I am going to give the AG office a call on Monday morning and see what they tell me. Was just looking for a bit of advice as this will be bugging me all weekend.

    Ocwen Loan Servicing, LLC (“Ocwen”) is offering you this Loan Modification Agreement (“Agreement”), dated 12/08/10,
    which modifies the terms of your home loan obligations as described in detail below:
    A. the Mortgage, Deed of Trust, or Security Deed (the “Mortgage”), dated and recorded in the public records of Washington
    County, and
    B. the Note, of the same date and secured by the Mortgage, which covers the real and personal property described in the
    Mortgage and defined therein as the “Property”, located at xxxxxxxx.
    Pursuant to our mutual agreement to modify your Note and Mortgage and in consideration of the promises, conditions, and terms
    set forth below, the parties agree as follows:
    1. You agree that the new principal balance due under your modified Note and the Mortgage will be $57,078.64. Upon
    modification, your Note will become contractually current; however fees and charges that were not included in this
    principal balance will be your responsibility.
    2. You promise to make an initial payment in the amount of $448.68 on or before 12/15/10, after which you will commence
    payments of principal and interest in the amount of $237.68 beginning on 1/1/11 and continuing on the same day of each
    succeeding month until all amounts owed under the Note and Modification are paid in full.
    3. Any payments due for taxes and insurance will be your responsibility in addition to the payments of principal and interest
    required under the terms of this modification. If this loan is currently escrowed, Ocwen will continue to collect the
    required escrow amounts with your monthly principal and interest payment.

    4. Upon Modification, the annual rate of interest charged on the unpaid principal balance of your loan will be 2.0000%.
    This rate will remain in effect until the maturity date of your loan.
    5. If you sell your property, refinance or otherwise payoff your loan during the 12 months following the date of Modification,
    the Modification will be voidable at the sole option of Ocwen and all amounts owed under the obligations existing prior to
    the Modification will be due and owing.
    6. You understand and agree that:
    (a) All the rights and remedies, stipulations and conditions contained in your Mortgage relating to default in the making
    of payments under the Mortgage will also apply to default in the making of the modified payments hereunder.
    (b) All covenants, agreements, stipulations and conditions in your Note and Mortgage will remain in full force and effect,
    except as herein modified, and none of the your obligations or liabilities under your Note and Mortgage will be
    diminished or released by any provisions hereof, nor will this Agreement in any way impair, diminish or affect any of
    Ocwen’s rights under or remedies on your Note and Mortgage, whether such rights or remedies arise there under or by
    operation of law. Also, all rights of recourse to which Ocwen is presently entitled against any property or any other
    persons in any way obligated for, or liable on, your Note and Mortgage are expressly reserved by Ocwen.
    (c) Any expenses incurred in connection with the servicing of your loan, but not yet charged to your account as of the
    date of this Agreement, may be charged to your account after the date of this Agreement.
    (d) Nothing in this Agreement will be understood or construed to be a satisfaction or release in whole or in part of your
    Note and Mortgage.
    (e) You agree to make and execute such other documents or papers as may be necessary or required to effectuate the
    terms and conditions of this Agreement which, if approved and accepted by Ocwen, will bind and inure to your heirs,
    executors, administrators, and assigns.
    (f) You understand that this agreement is legally binding and that it affects your rights. You confirm that you have had
    the opportunity to obtain, independent legal counsel concerning this Agreement and are signing this Agreement
    voluntarily and with full understanding of its contents and meaning.
    (g) Corrections and Omissions: You agree to execute such other and further documents as may be reasonably necessary to
    consummate the transactions contemplated herein or to perfect the liens and security interests intended to secure the
    payment of the loan evidenced by the Note.
  4. Maurice Bedard

    Maurice Bedard Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    That is definitely not a HAMP mod. A HAMP mod has a clause allowing for corrections. A HAMP mod also says it isn't final until they sign and return a copy. I don't know if clause 'E' gives them an out from it or not. I would think that they would need to send you any documents if there is something they need. You could call them and listen to what they say, but don't offer any hint or acknowledge ment or agreement that you accept that there is an error. I would just make the payments on time and see what they do. Just because you agreed to an inhouse mod does not mean they can take it back. An inhouse mod does not have to conform to MHA rules. If this was on the MHA form, you would not have a chance of this going through. HAMP would not allow a permanent 2% rate, for one thing that alone would be enough to cancel it or change it.

    Like I said, clause 6(e) is the only scary one. Are they talking about approval and acceptance of any documents you provide or are they talking about acceptance and approval of the Agreement. I can't see them sending a document and then saying they need to approve the document they sent.
  5. bmjm1025

    bmjm1025 LoanSafe Member

    Thanks menace for you input.

    I see what your saying regarding the clause 6(e). What about clause 6 (f) where it states that this agreement is legally binding. Shouldn't it be legally binding for them as well as us?
  6. Maurice Bedard

    Maurice Bedard Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    If the document allows them to make you agree to supply other docs, I doubt it is completely binding on them. I still suggest waiting it out. They have your mailing address.
  7. maryseas

    maryseas LoanSafe Member

    I just received an offer from BAC with the same clause (6 e) and that bothered me too. I'm going to run it by my attorney. The terms were not nearly as favorable, but I wonder if (6 e) is in there to correct any problems they are having as a result of MERS and not recording assignments and sales of the note and trust deed in the state where the property is. This of course is against state law, but they aren't doing this. The when suit is filed, they go back and correct (and back date things) and then record in the state so judges won't rule against them. Anyone have any thoughts?
  8. bmjm1025

    bmjm1025 LoanSafe Member

    Today we got the papers in the mail they were refering to. All it basically stated that we didn't qualify for the HAMP mod. It was dated prior to the in house modification they gave us. So i guess i just got scared for nothing. I went ahead and looked at our account on their website and it has updated with everything with the new modification terms.

    Another question i have regarding this:

    With them reducing our principal balance my $70+ thousand. How will that work at tax time? Will we get a 1099 for that? Because we are now no longer upside down on our mortgage and owe alot less than its worth.

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