Maximum Number of Loan Modifications - is this a thing?

[erzulie]

Hi!

Question. My situation is that, I had my loan modified through HAMP, back in 2010. Everything went swimmingly ... payments affordable, made on time ... all is well.

Fast forward to October 2016; I lost my job. I managed to continue paying my mortgage, via draining my savings, but ... that started to run out in March 2017. I reached out to my servicer, JP Morgan Chase, who accepted paperwork from me to approve me for an "unemployment deferral". Or so I thought ... as in early June, I received a letter from SPS Servicing, that my mortgage was transferred to them.

I had to go through the application process all over, for unemployment assistance; they approved me, though. October/November/December of 2017, I made a smaller payment; January of 2018, they sent me a letter saying "Congratulations, you've completed the trial period - now, please pay a balloon payment of $41,000, and we're all squared away!" I called, explained that if I were able to pay such a balloon, I would not have needed assistance to begin with ... but, I digress ...

Lo and behold - I got a job a month later! And, like a true idiot, started making payments to them, beginning March 1 of this year. For several months, my payments went through ... but, in June, they no longer accepted anything from me. I sent another round of application paperwork, essentially asking for help with the amount I had in arrears from my unemployment ... they denied me for everything, and filed an NOD on July 23. I appealed their decision, and they denied me again.

The specific reason for their denial .... "the note holder/investor on your loan does not allow more than one modification."

Mind you - I have almost $300,000 in equity in my home at the moment. I would simply refinance into another mortgage somewhere else, but ... SPS has all kinds of things on my credit report that would make that impossible.

My note holder/investor is Bank of New York/Mellon. Does anyone have any information, as to if what SPS is saying is true - that I am only allowed one modification on my mortgage?

I appreciate any insight or guidance you panel of incredible experts might have! I am desperate to keep my home ... it is my haven, my retirement plan, and soon to be the oasis for my ailing and almost-80-years-old mother ...

THANK YOU, in advance ....

 

[Jzone]

Find out if SPF actually is the lien holder now and not just the servicer. You can check with your county register of deeds and see who has the mortgage and lien.

I have heard of many with 2 modifications.

When is the last time you heard from SPF? What does the rest of your credit report look like?

 

[erzulie]

Find out if SPF actually is the lien holder now and not just the servicer. You can check with your county register of deeds and see who has the mortgage and lien.

I have heard of many with 2 modifications.

When is the last time you heard from SPF? What does the rest of your credit report look like?

SPS Servicing - the organization who told me that I was not eligible for a second modification - is just the servicer. In fact, they aren't even really a mortgagor - they are a collection agency. There is no possible option with them to, say, refinance.

The note holder/investor on my loan is Bank of New York/Mellon. At least, that is what it says on my NOD. The organization that filed the notice of default is a completely different organization, however ... "Quality Loan Servicing". No idea what their relationship is to SPS Servicing. It all hurts my head.

OH - and to answer your question, 'what does the rest of my credit look like' - my credit is otherwise pristine. No late payments, no big debts. I have a small car loan that is nearly paid off, and a student loan - all in good standing. My credit rating was in the high 700s before this all happened. Now it hovers between 620 - 650; if I file bankruptcy, I am sure it will plummet below 500.

I just want to keep my home. I don't know what options I have left, except to file Chapter 13 Bankruptcy. While that will at least give me the ability to cure my default through payments on the arrears, it will bind me to SPS as my servicer, as my chances of getting a refinance into a decent loan would be eliminated due to my credit being destroyed.

If I could refinance, I would have done that already ... I have an "amount to reinstate" of $75,000, and I have about $300,000 equity in my home ... equity I am unable to access, thanks to this nightmare.

Thanks for your help, time, and any insight ...

 

[OneHugeMess]

@Erik Sandstrom, is it possible to roll this loan into something like FHA? I know you have a few NonQM solutions as well.

 

[OneHugeMess]

Erik will chime in soon, but there is definitely a way to refinance this. You may have to take out a non-traditional mortgage, and rate may be high (5-7%) but after a year, you could refinance into a traditional fixed rate loan with the payment history. There is always hard money as well if it comes to it.

 

[Erik Sandstrom]

So so so sorry for the late reply, it's been a busy month at my office which of course is great.

Erzulie,
FHA is not typically an option once an NOD is filed but I may have a non-QM mortgage option that would help in this case but it wouldn't provide much payment relief, rather a short term loan with an ability to refinance once you have 12 months payment history on time.

Can I ask, what is your current loan amount?

 

[erzulie]

Thanks for your reply!

So ... the craziest thing happened. I am still so cynical, that it is hard to accept. After all the rigmarole of this entire year ... out of the blue, I received a loan modification offer, with terms that seem very acceptable and quite lovely. I am astonished that I am receiving this at this point ... after being told SO many times, that I was being denied for anything.

I am still not 100% convinced ... I guess I won't be, until I make the first trial payment, and see the foreclosure finally go away ... which will be in a few months, I imagine. But, still, feeling cautiously optimistic!

I wish I could say what it was that triggered the sudden loan modification approval ... I have zero idea. But, I'm not going to ask that question to them outloud - I'm going to accept the gift I've been given!!!

 

[Erik Sandstrom]

These days you never know what servicers are going to end up doing. Glad a positive light has been shed here, we will all keep our fingers crossed that the permanent mod is granted for you. If you ever have any random questions that need to be answered right away, feel free to call our 800 number. I am typically the one that answers the phone and will help as much as I can.