Hello Lfreitas,
Every modification proposal is reviewed for HAMP first, without exception, because the government pays incentives to the banks for each HAMP modification done. The problem I see here though is that there are no narratives from the servicer in the NACA file to support the statement regarding the denial dates. BOA’s contract with us requires that the declines be noted in the file as they are decided upon.
The sad fact is that it is much harder if not impossible to get a modification when the mortgage is current, and it has nothing to do with the modification being HAMP or in-house. The bank cannot see that you are sacrificing elsewhere to do the right thing and meet your obligations. All they can see is that you are making the mortgage payment on time every month. It becomes a case of “actions speak louder than words”. You may apply for a modification, but the fact that you pay your mortgage every month tells them that you do not have a problem paying because you ARE paying.
I have seen many cases where people actually borrow money from another source to make the mortgage payment. When people borrow money to make an unaffordable mortgage payment, they make TWO huge mistakes: First, by making the payment, they again tell the bank that they can make the payment without problem, because they ARE making the payment. Second, by borrowing money for the payment, they are only transferring debt from one source to another. Any consumer or financial advisor will tell you that is a guaranteed path to disaster. You now have two debts you can’t pay back instead of one.
That being said, NACA will never tell you to not make your mortgage payment if you can afford to. Responsible home ownership is the foundation of NACA’s mission. But many people who can’t afford the payment make a mistake by draining their 401-K, credit cards, etc. to make the payment. Eventually it will only make the problem worse since you make it harder to get a modification and you are also depleting your retirement or creating another huge debt you can’t afford.
Many servicers and/or investors do have a “gray area” called Imminent Default. Basically, you must prove that you are about to go past due on the mortgage and cannot do anything about it, and one of the "Four D's" must also be a factor: Death, Divorce, Disability or Disaster. Reduced income through unemployment or business decline will not qualify.
Nearly all investors do require that the mortgage be at least two months late or qualify under Imminent Default to grant a modification. In some cases, the lender can grant a three month forbearance if you can show genuine hardship but are still current. This allows the loan to technically become delinquent and thus become eligible for modification when it would not otherwise.
I have escalated the file and requested a second review on your behalf. Please continue to monitor your file and contact me directly if there has been no response in two weeks, since it may be necessary to update and resubmit the file.
Tim Trumble
Online Operations, NACA
[email protected]
Every modification proposal is reviewed for HAMP first, without exception, because the government pays incentives to the banks for each HAMP modification done. The problem I see here though is that there are no narratives from the servicer in the NACA file to support the statement regarding the denial dates. BOA’s contract with us requires that the declines be noted in the file as they are decided upon.
The sad fact is that it is much harder if not impossible to get a modification when the mortgage is current, and it has nothing to do with the modification being HAMP or in-house. The bank cannot see that you are sacrificing elsewhere to do the right thing and meet your obligations. All they can see is that you are making the mortgage payment on time every month. It becomes a case of “actions speak louder than words”. You may apply for a modification, but the fact that you pay your mortgage every month tells them that you do not have a problem paying because you ARE paying.
I have seen many cases where people actually borrow money from another source to make the mortgage payment. When people borrow money to make an unaffordable mortgage payment, they make TWO huge mistakes: First, by making the payment, they again tell the bank that they can make the payment without problem, because they ARE making the payment. Second, by borrowing money for the payment, they are only transferring debt from one source to another. Any consumer or financial advisor will tell you that is a guaranteed path to disaster. You now have two debts you can’t pay back instead of one.
That being said, NACA will never tell you to not make your mortgage payment if you can afford to. Responsible home ownership is the foundation of NACA’s mission. But many people who can’t afford the payment make a mistake by draining their 401-K, credit cards, etc. to make the payment. Eventually it will only make the problem worse since you make it harder to get a modification and you are also depleting your retirement or creating another huge debt you can’t afford.
Many servicers and/or investors do have a “gray area” called Imminent Default. Basically, you must prove that you are about to go past due on the mortgage and cannot do anything about it, and one of the "Four D's" must also be a factor: Death, Divorce, Disability or Disaster. Reduced income through unemployment or business decline will not qualify.
Nearly all investors do require that the mortgage be at least two months late or qualify under Imminent Default to grant a modification. In some cases, the lender can grant a three month forbearance if you can show genuine hardship but are still current. This allows the loan to technically become delinquent and thus become eligible for modification when it would not otherwise.
I have escalated the file and requested a second review on your behalf. Please continue to monitor your file and contact me directly if there has been no response in two weeks, since it may be necessary to update and resubmit the file.
Tim Trumble
Online Operations, NACA
[email protected]
TIA!