Upside Down Mortgage

Posts Tagged ‘loss_mitigation’

Loss Mitigation Application

Recent legislation at the state and federal level as well as some recent bank takeovers by the FDIC have made loan modification application rates soar. Unfortunately, most consumers on their own are having little to no success modifying their loan, unless it is just a forbearance agreement in which the lender allows the borrower to pay back any monies that are in arrears over time. This is hardly a loan modification and the late payments a have already adversely affected your credit and make it impossible for you to refinance.

Unfortunately, most companies that are not law firms can only get you a forbearance agreement, and they do nothing to protect your rights, so make sure you have loan modification attorney represent you with your lender to protect your legal rights. In fact recent legislation enacted in California Loan Modifications requires that a lender must give you a modification review prior to foreclosing on your property, and the consumer may only be represented by an Attorney for HUD approved Counselor, or they give up many of their rights in a foreclosure. Many of the "Attorney Based" or "Attorney Backed" companies actually are not law firms nor will you be represented by legal counsel and could give up many of your legal rights by using such a company. The banks will not modify willingly and only an attorney can protect your rights and apply the right kinds of pressure to a Lender's legal department to get you the result you are looking for. Even HopeNow, a free service that offers counseling to consumers is so mired in backlog, most consumers homes will be foreclosed on long before they get help.

"If you are looking to modify your loan, be prepared to have a truthful and honest about both the reasons for your financial hardship as well as your true financial picture" says Marc Bonanni, Attorney for http://www.consumerdebtadvocate.net. . "Be prepared to provide documentation as back-up. Properly preparing a case to take to your lender in the loan mitigation process is critical, and properly structuring the mitigation proposal off the information you provide is a key aspect of preventing foreclosure" says Marc.

It is also important to understand that you must meet strict financial guidelines to even be considered for mortgage mitigation. If your financial picture is so dire that you are still financially encumbered even with a 1% interest rate, it is unlikely that you will be able to save your home from foreclosure. If your lender feels they will take less of a loss if they foreclose now because there is uncertainty that you can meet your new modified loans structured payments, they would rather foreclose now to lessen their loss.

There are three key elements in any loan modification or loss mitigation process. Each is an area to negotiate depending on the borrower's unique circumstances. The first would be adjusting the interest rate of the first or second mortgage to a lower one that would be manageable by the consumer. The second would take into consideration any missed payments and penalties that are in the arrears, and structuring a repayment plan or putting those monies on the back of your loan. The third and most difficult is if your loan is now worth more than your property. Getting the lender to write down principal balance can happen in the right circumstances, especially if there are predatory lending issues involved in your case, but don't expect your lender to make you whole on your bad investment decision. Again, preparing the right argument is key and expect the negotiations to take 45-60 days at a minimum. It is an intense process and the Loss Mitigation departments at most lenders are understaffed to meet the monstrous demand of consumers who are vying for their attention from everything from late payments to foreclosures. Again, most attorneys can bypass the loss mitigation department and work directly with your lender's attorneys, so this is still your best bet for success in the loan modification process.

About the Author:

Bill Baskin is a nationally recognized expert on Mortgage, Credit, Automotive, and Debt topics, having been a quoted source on a variety of newspaper, radio, and television pieces. He currently writes for

http://www.consumerdebtadvocate.net
on consumer education pieces.

Source - What You Need to Know About the Loan Modifcation Process

LOSS MITIGATION EXPRESS-SALES PRESENTATION.WMV

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Loan Modification Cases

Question: Loan Modification First Payment or keep Checking from Chex?

Ok here is the brutal honest truth-I lost my Father had to pay for his funeral expenses and pay his debts- in the meantime did not pay close enough attention to my bank account and debt (obviously)-I did a loan mod on my house which was a long process and finally my first payment is due the 1st of May-now on the other hand I let my check account get out of control and I owe 1400-if I don't pay that off by the 30th of April they will send to collections and Chex-my mortgage NORMALLY gives a 15 day grace period but I am not sure in the case of just doing a loan mod-I cannot pay both by the due date-I can have both paid if the mortgage can wait until the grace period date-any advice? thanks!!

Answer: Have you contacted your bank? Usually you can set something up with them to pay it back in smaller increments, as long as you make your weekly payments. I went through that with my bank (I was overdrawn by 300) and they let me pay it back weekly while still allowing me to use my account and not taking all of the money out when my direct deposit went in. Contact your mortgage company and just ask them. Don't go into it detail, just ask. The worst they can tell you is no.

Can you get your pay/money in cash/check form and just Western Union or MoneyGram your mortgage payment to the company? That is one way to make sure your mortgage company gets the payment. I understand that your risking the account going to collections, but making your mortgage payment on time far outweighs your bank account going to collections. Good Luck!

Loan Modification Case Study

Loss Mitigation Attorney

Question: Small claims court or prosecutor?

Long story short, I filed a complaint with the BBB of Chicago about a "loss mitigation" company that defrauded me out of $1500. The complaint went unanswered and the BBB recommended I should contact Cook Co. small claims.

The question I have is a two-part one. First, I live in another state and travelling to IL to pursue this is going to be difficult at best. Can I file this claim in my own county's small claims court, seeing that I was a resident here when I contracted with the Chicago company? And secondly, should I first pursue this through either the IL or OH (my home state) attorney general's office instead? I believe what this company did was knowingly and willfully criminal in defrauding me.

I need some info on the next step in this process and any help would be greatly appreciated!

Answer: You may not have to go to another state to file your complaint. It depends, and it takes some real lawyer work here but if that company does enough business in your area (some other requirements need to be met) then your state may have jurisdiction over them.

Even if you do file a civil complaint, you should still contact their state's attorney general. You can do both. A criminal prosecution doesn't effect your civil law suit.

Good Luck

Mortgage Loss Mitigation - Mortgage Loss Mitigation