Chase Loan Modification vs. Refinance

dos81

LoanSafe Member
Dec 31, 2008
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Hello all,

I am new to the site and glad to see there is a place where people can get educated about the loan mod process, which is why I am here. I am new to the process but have heard alot more about it in the past few months.

I have a Chase 30 yr. fixed mortgage @ 6.25%,
I bought the house in June 2006,
currently owe $325K on the loan
Riverside, CA

Ok, well my story is that I have taken a 20% paycut from work since April 2007 which really has made things difficult and have managed to get by without being late on an payments thanks to God. Well it is getting increasingly difficult to stay current so I have just started thinking about a refinance or loan mod. I called Chase Finance yesterday and they told me they would do the refi but the house would have to appraise for $375K which I know it won't, it probably will only appraise for $325K at the most, so I pretty much owe what it's worth right now.

So seeing that a refi is not likely, what should I expect of the loan mod process with Chase. I tried to get someone on the phone about it but but they transferred me around to several people and in the end I hung up after only automated options. One guy did tell me that I would have to talk to a different dept. since my loan is prime.

I have also talked to a friend that is using an attorney service that does loan mods to help them but am liery about it. At this point I don't want to do anything to affect my credit score like being late on my payments, if I can avoid it. Is a loan mod possible working with Chase directly or is it better to work through an attorney that can manouver for me. I am not looking for a balance reduction per se but would be happy with a permanent interest rate reduction to lower my monthly payments several hundred dollars to make it more affordable for me, since I don't know when I am likely to get my full wages back. What advice do you have for me?

Thank you very much for your help,

Dan
Riverside, CA
 

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
26,799
456
1,000
48
Southern California
www.loansafe.org
HI Dan,


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

The issue that you may run into is that the modifications are up to the investors on these loans...........and whether or not you hire a third party or do this yourself, the modification approval still would need to go to the investor...........so the outcome will likely be the same......you can do this yourself for free.........the same as a service you would pay for.

Given the information on the loan you would need to call Chase and ask if the investor on the loan is either FannieMae or FreddieMac and depending on which one would depend on whether or not they will be able to offer a modification. If it is FreddieMac, they are currently only looking at loans that are 90+ days in default for their streamlined modification program......

So call Chase and ask what the options are for modification on your loan.
Chase Loss Mitigation
1-877-838-1882 ext. 52195



Please keep up posted on your progess........
 

dos81

LoanSafe Member
Dec 31, 2008
29
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0
Thanks Cat. I appreciate your help on this. I called the number you listed and they gave me the run around and finally told me I had to call another number for 'prime' customers. After more runarounds I finally got someone on the phone at the 'Loss Mitigation/Homeowner's Assistance Dept.' 1-800-446-8939 who said that I would not qualify for a loan mod because I was not behind on payments, I did not lose my job, have a death in the family, or have a medical condition. Apparently taking a severe paycut does not qualify. What do you suggest I do from this point? I don't see Chase working with me on this. Does using an attorney for loan mods to help make it happen, my only avenue?

Thanks,

Dan
 

Dan Bailey

Senior Member
May 19, 2008
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Wilmington NC
dos,
The serviser of the loan(Chase) is constrained by the guidelines of the investors on the loan. Having an attorney may or may not help, depending on the investor. Any attorney that "guarentees" a mod, is just plain blowing smoke.
 

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
26,799
456
1,000
48
Southern California
www.loansafe.org
It would seem that the investor on your loan is FreddieMac.......and they are only modifying loans that are 90+ days in default at this time......it may change in the future once they get through the portfolio of loans that are in foreclosure, but nothing has been announced as of yet............any modification approval, even from a third party would need to still go through the investor for a final approval. Your paycut is definately a hardship but the way they see it, strictly from a business standpoint, it appears that you are still able to make your payments even with the cut........and that unfortunately is all that they see.
 

dos81

LoanSafe Member
Dec 31, 2008
29
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0
Thanks Cat and Dan. It sure seems like many of us are falling through the *****s. Do you think the new administration will be able to push through new legislation forcing the lenders and their investors to modify homeowner's accounts that are not yet late. Just a thought.
 

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
26,799
456
1,000
48
Southern California
www.loansafe.org
This is our hope.......:)
 

dos81

LoanSafe Member
Dec 31, 2008
29
0
0
Hi Cat,

I got someone on the phone at Chase Loss Mitigation finally that would talk to me and they told me that my investor on the lone is Fannie Mae and that they would need a list of my monthly earnings and expenses to turn into Fannie for them to review. Apparently they say there is a 60 day waiting time for response. Do you have any suggestions how I go about doing this. She said to just call them back and give them the figures over the phone.
Thanks,

Dan
 

HopingtoFind

LoanSafe Member
Oct 7, 2008
2,084
28
48
Bay Area, CA
Hi Dan,

Yes, they take your income/expenses over the phone and then assign you an an analyst. They you just need to call and follow up. We have started this process at the end of October.
 

dos81

LoanSafe Member
Dec 31, 2008
29
0
0
Hi Hoping,

What is your experience with Chase so far? Have they been responsive to you?

Dan
 

HopingtoFind

LoanSafe Member
Oct 7, 2008
2,084
28
48
Bay Area, CA
Dan, Chase are ok to deal with, just painfully slow. We had it assigned to an analyst in the middle of November and at this point there was not much done since middle of December, but I think she was out during the holidays. So I keep calling...
 

dos81

LoanSafe Member
Dec 31, 2008
29
0
0
Thanks Hoping,

I just got off the phone with them and they are asking me to fax over my monthly earnings and expenses, as well as the last 2 pay stubs and last 2 month's bank statements. Is that what they asked you for as well?
Thanks for your help,

Dan
 

dos81

LoanSafe Member
Dec 31, 2008
29
0
0
Cat and Hoping,

I have written a hardship letter below based on what you guys provide here as an example. Can you read and let me know what you think before I turn it in. I want to make sure I am wording everything right.
Thanks,

Dan



To Homeowner’s Assistance Dept.:

I am writing this letter to explain our unfortunate set of circumstances that have made it very difficult to make our mortgage payment every month. We take great pride that we have been able to stay current and in good standing on our mortgage payments, but recent financial changes of reduced income along with rising utility costs have made it extremely difficult to make the payments every month. We have tried to pursue a refinance with Chase but were unable to do so because the home currently will not appraise for the amount needed for the refinance. This is why we would like you to consider working with us to modify our loan. Our number one goal is to keep our home and we would really appreciate the opportunity to do that.

The main reason that caused this difficulty is that we are receiving a reduced income in my earnings. I received a 20 percent pay cut on my wages effective April 26, 2007 and it is unlikely that I will receive my regular pay rate again. I work in the construction industry and because of the housing crisis the company I work for has had to do pay cuts and other extreme measures to survive. It is our full intention to pay what we owe and we fully intend to keep our home. But at this time we are experiencing financial difficulty even after cutting back in our spending and expenses.

We feel that a loan modification would benefit us both. Chase Home Finance can keep a client and we can keep our home. We would appreciate if you can work with us to lower our payments so we can keep our home. We have had various credit accounts with your firm for years and look to keep a beneficial relationship with your firm.

We truly hope that you will consider working with us and we are anxious to get this settled so we all can move on.

Sincerely and Respectfully,

Borrower’s Signature
Date
Co-Borrower’s Signature
Date
 

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
26,799
456
1,000
48
Southern California
www.loansafe.org
Dan,

The letter is a very good one............you explain the hardship and you keep it to the point.

Good Luck with the mod!

Keep us posted.........
 

HopingtoFind

LoanSafe Member
Oct 7, 2008
2,084
28
48
Bay Area, CA
Dan, I agree with Cat, very good letter. Pretty much along the lines of what we have stated in our letter.

As far as to what happened in our case... it was a little different, they first took all of our information over the phone and then when the case was assigned to an analyst, she asked us to fax the income verification and bank statements.

Best of luck with the mod.
 

dos81

LoanSafe Member
Dec 31, 2008
29
0
0
Thanks Cat and Hoping,

I will keep you guys posted. I plan on submitting everything in tomorrow. Thanks guys for your help,

Dan
 

dos81

LoanSafe Member
Dec 31, 2008
29
0
0
Cat,

Do you think that in my letter I should mention that I am not looking for a principle reduction per se but a substantial interest rate reduction. Also should I mention in the letter that I know Fannie Mae is the investor on the loan?
Thanks,

Dan
 

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
26,799
456
1,000
48
Southern California
www.loansafe.org
FannieMae has already given the criteria for the modifications that they are willing to approve to the servicers which includes lowering rates and extending terms.........so you shouldn't have to change anything from the letter that you have here.
 

dos81

LoanSafe Member
Dec 31, 2008
29
0
0
Cat,

I have gone ahead and faxed my request along with hardship letter, pay stubs, banks statements, etc. After I faxed it over, I called to check if they got it and someone told me that they have to 'digitize it' into the system and that process can take upto 5 days, to call back then. Do you think I should also mail my request to them certified so I have proof that they got it?
Thanks,

Dan