Working on various loan mods for 2.5 years - getting denials... Please help!

derekkkk

LoanSafe Member
Jul 30, 2013
9
0
0
Hello-


I Own 3 rental properties with 1st mortgage loans (no ends) - 2 are with Wells Fargo, 1 with SPS. Sps is using my net income (vs gross) and are denying it based on that.


The Wells Fargo loans are almost identical. I am not receiving any rental income from the Wells Fargo properties because they are vacant
I do not have any housing expenses because my wife owns the property and the debt is in her name. I have approximately $700 in monthly debt
All the properties are in MN
I was denied the modification because of the mortgage / housing expense. If the two Wells Fargo properties were combined I would be over the 25% but because they are not combined I am below the 25% threshold
I do have rental expenses that could possibly lower my gross income, but then my back end ratio would be way to high.
Any advice / insight would be so appreciated!
Thank you


Wells Fargo loans 1 and 2
1. Loan Balance Now= 80000
2. Past Due if any= 25000
3. Gross Monthly Income for Borrower and Co Borrower= 7300
4. Mortgage Payment without taxes and insurance (do not include taxes and insurance) = 693.00
5. Real Estate Taxes per month= 126.00
6. Hazard Insurance and/or HOA per month= 488.32
7. Home Value (check zillow.com or chase home value estimator)= 39000
8. Mortgage servicer and Investor (check if fannie or freddie or MERS below links) N/A
9. Other monthly debt payment total for credit cards and collections = 700
10. Current interest rate = 7.08
11. Fixed Rate or Adjustable Rate? = Fixed
12. Have you been modified before? No
13. When did you get this loan, what year? = 2006



SPS loan:


1. Loan Balance Now= 330000
2. Past Due if any= 20000
3. Gross Monthly Income for Borrower and Co Borrower= 7300
4. Mortgage Payment without taxes and insurance (do not include taxes and insurance) = 2122.50
5. Real Estate Taxes per month= 361
6. Hazard Insurance and/or HOA per month= 119.83
7. Home Value (check zillow.com or chase home value estimator)= 305000
8. Mortgage servicer and Investor (check if fannie or freddie or MERS below links) N/A
9. Other monthly debt payment total for credit cards and collections = 700
10. Current interest rate = 6.00
11. Fixed Rate or Adjustable Rate? = Fixed
12. Have you been modified before? No
13. When did you get this loan, what year? = 2006





Thank you!
 

TomEason

LoanSafe Guide
Jun 18, 2009
12,390
85
48
SF Bay Area CA
derekkk

Thanks for your post. As I'm sure you know, properties 1 and 2 (with the WF loans) are not underwater, i.e. you have a small amount of equity. The property with the SLS loan is underwater (no equity). As you know, each property must be dealt with separately. If it were me, I'd resubmit loan mod apps on all 3 properties. I'd also recommend you immediately stop making any payments to the lenders and to the county for property taxes, and rent out the vacant properties. You'll realize immediate positive cash flow rental income because you'll not be paying anything. And you'll likely continue to enjoy that recurring rental revenue stream for many many months until the lender finally FCs. Enjoy!
 

derekkkk

LoanSafe Member
Jul 30, 2013
9
0
0
Thanks for your post. As I'm sure you know, properties 1 and 2 (with the WF loans) are not underwater, i.e. you have a small amount of equity. The property with the SLS loan is underwater (no equity). As you know, each property must be dealt with separately. If it were me, I'd resubmit loan mod apps on all 3 properties. I'd also recommend you immediately stop making any payments to the lenders and to the county for property taxes, and rent out the vacant properties. You'll realize immediate positive cash flow rental income because you'll not be paying anything. And you'll likely continue to enjoy that recurring rental revenue stream for many many months until the lender finally FCs. Enjoy!
Thank you very much for your reply. I believe I might have made an error in my description, because the wf properties are also under water. I owe at least 80,000 on them and they are worth 30,000. I would love to keep them, but my financial situation has charged. I can now afford them, but I can't afford the back payments, penalties, etc.
Do you have any other ideas as to how to keep the properties?
thank you so much
 

TomEason

LoanSafe Guide
Jun 18, 2009
12,390
85
48
SF Bay Area CA
Hi derekkk

Thank you very much for your reply. I believe I might have made an error in my description, because the wf properties are also under water. I owe at least 80,000 on them and they are worth 30,000. I would love to keep them, but my financial situation has charged. I can now afford them, but I can't afford the back payments, penalties, etc. Do you have any other ideas as to how to keep the properties? thank you so much
Thanks for your post. You didn't make an error - I did! I misread the $39K value you posted. My answer was based on the value being $390K. Big error! Again, I would recommend you rent out the properties ASAP, not only for the cash flow, but in order to qualify for a HAMP Tier II mod, a rental property must either be rented, or the borrower must have the intention to rent it. If it were me, I'd submit loan mod applications on them all.
 

derekkkk

LoanSafe Member
Jul 30, 2013
9
0
0
I have applied and the wf loans are being declined because my housing to income ratio is to low.
Sps used my net income and are declining it because my net income isn't sufficient. Gross is more than sufficient. I have stopped my 401k and increased deductions to increase my net. Any ideas on what I can do? I would be willing to pay money to get the loans modified. Thank you for the help
 

TomEason

LoanSafe Guide
Jun 18, 2009
12,390
85
48
SF Bay Area CA
Hi derekkk

I have applied and the wf loans are being declined because my housing to income ratio is to low. Sps used my net income and are declining it because my net income isn't sufficient. Gross is more than sufficient. I have stopped my 401k and increased deductions to increase my net. Any ideas on what I can do? I would be willing to pay money to get the loans modified. Thank you for the help
Thanks for your post. You might contact the LoanModHelpCenter for assistance. They are a sponsor of this site; their logo is prominently displayed.
 

derekkkk

LoanSafe Member
Jul 30, 2013
9
0
0
U have left a few messages at 855.678.6690. Do you have a different number for me to call?
Thank you
 

derekkkk

LoanSafe Member
Jul 30, 2013
9
0
0
Sorry for my mistyping
'I' have left messages.... Not 'u'
Thank you for your help
 

derekkkk

LoanSafe Member
Jul 30, 2013
9
0
0
I have left a few messages, but have not had any responses. I will apply for the modifications, but the sps loan, they are using my net income vs gross income. They are indicating that my net income is not enough. Has anyone else run into this issue? I have now stopped my 401k, and increased federal withholdings to increase my net, but wanted to pass it by the experts.
would you recommend any other loan modification companies as this one will not call me back
thank you
 

TomEason

LoanSafe Guide
Jun 18, 2009
12,390
85
48
SF Bay Area CA
Hi derekkk

I have left a few messages, but have not had any responses. I will apply for the modifications, but the sps loan, they are using my net income vs gross income. They are indicating that my net income is not enough. Has anyone else run into this issue? I have now stopped my 401k, and increased federal withholdings to increase my net, but wanted to pass it by the experts. would you recommend any other loan modification companies as this one will not call me back thank you
If you click on the LMHC's banner ad, you may find other ways to contact them. To find other loan mod outfits, you might Google the term.
 

derekkkk

LoanSafe Member
Jul 30, 2013
9
0
0
Net income calculation

Hello, and thank you for all of the information and assistance. Understand the gross income calculation. What percentage are the banks looking for with the net income calculation? I have been denied because of my 401k, and other voluntary distributions and would like to see if I could qualify.
On a side note, I have called and left many messages on different phone numbers....
Thank you for your answers. They are appreciated
 

TomEason

LoanSafe Guide
Jun 18, 2009
12,390
85
48
SF Bay Area CA
Hi derekkk

Hello, and thank you for all of the information and assistance. Understand the gross income calculation. What percentage are the banks looking for with the net income calculation? I have been denied because of my 401k, and other voluntary distributions and would like to see if I could qualify. On a side note, I have called and left many messages on different phone numbers.... Thank you for your answers. They are appreciated
Thanks for your post. I'm presuming you weren't able to get assistance from LMHC. It may not matter. You can do this yourself if you the HAMP reference to refer to. To know first hand for certain what the criteria and standards are for a HAMP mod, I recommend you download the MHA Handbook for Servicers on Non-GSE Loans v4.2.
 

derekkkk

LoanSafe Member
Jul 30, 2013
9
0
0
Can you please email me the link to
MHA Handbook for Servicers on Non-GSE Loans v4.2

Thank you!
 

Evan Bedard

Call 1-800-779-4547
Loan Safe Mortgage
Aug 26, 2007
18,837
48
48
San Diego, California
www.LoanSafe.org
Thank you very much for your reply. I believe I might have made an error in my description, because the wf properties are also under water. I owe at least 80,000 on them and they are worth 30,000. I would love to keep them, but my financial situation has charged. I can now afford them, but I can't afford the back payments, penalties, etc.
Hey Derekk,

Just wanted to chime in here, it seems to be in your best interest to find a renter asap for both properties. This will not only enable you to receive some extra cash flow, but you will also have a much better chance receiving a loan modification if you have tenants. I cannot recall ever hearing of a successful loan modification on a vacant property.