Loan Modifications-Where do you begin and do you even qualify?

The Making Home Affordable program is a comprehensive program designed by the Administration to offer relief to homeowners who are struggling to make their monthly mortgage payments and to get the housing market back on track. There are several components to this program.

HAMP-is the one most of us are familiar with.  By having the government provide mortgage loan servicers with financial incentives to modify existing first lien mortgages, the Treasury hopes this will help homeowners avoid foreclosure and remain in their homes. It does not matter who owns or guarantees the mortgage.

What are the requirements for eligibility in the HAMP Loan Modification Program?

Loan Modifications. Are they Spinning out of Control?

by Elise Fay

On 2 separate occassions I have had clients who in attempting to do a Loan Modification only to discover that they were not “qualified” and/or they never received an answer except to hear that the “package was not complete”.  As a result of their frustrations they called me, an AZ Short Sale Specialist..we listed the home, found a buyer and submitted the package to the bank.

My most recent client had tried to do a Loan Mod with IndyMac/OneWest Bank.  They submitted his request thru the HAMP Program (one of our latest and greatest Gov’t programs) and they eventually received a Denial. At that point we were ready to submit a full short sale package thinking that since they were denied a Loan Mod, the Short Sale process would proceed somewhat smoothly but….NO!

The bank decided that since they did not qualify for a HAMP Mod. they would try to qualify him for another type of Loan Mod…all without my client’s knowledge.  The short sale package was confirmed as received but it is still Spinning out of Control in the Loan Mod. dept and it has taken an act of God to get it moved over to Short Sale review, even after submitting 2 letters stating that a short sale is requested…(I would have said an Act of Congress but you know how that goes!)  I have had the same thing happen several months ago on a Chase file but that was before all of these great government programs were launched.

If the “correct Process” for a homeowner in distress is to start with a HAMP modification and when that fails request a Short Sale, why is this so darn comlicated?  To me it's unfortunate…this is all supposed to be designed to help the homeowner when in reality they can’t get out of their own way to get the process started.  Why does it take 3+ weeks and 4 escalations to get a file to the correct department?  I almost feel that it is a waste of time to even entertain a Loan Modification of any sort unless of course the homeowner’s intention is to really stay in the home for a while.  But to go thru this process as a formality???? The homeowner only gets disgusted and discouraged.

We're here to help you start on the right path from the beginning.  The most important part of the Loan Modification process is understanding what you are getting yourself into. 

Elise Fay, AZ Short Sale Realtor

(originally posted on wannanetwork)