By Moe Bedard
If you have been looking for mortgage help or assistance with a loan modification, then you have came to the right website for safe and accurate information. This blog and our forum at LoanSafe.org was created for the sole purpose of assisting homeowners who are struggling with their mortgages to find the “real deal” when it comes to understanding what these crazy lenders and servicers are doing to help.
By all means DO NOT TRUST these phony loss mitigation companies that are preying on homeowners everywhere. Many of these fly by night companies are coming out of the wood work and their sole purpose is to scam desperate homeowners.
You will see these scammer websites advertised all over the search engines like Google and Yahoo.
Many make false claims that that they have a 98% success rate or they can obtain $100,000 mortgage loan principle reductions and their results are guaranteed. They take your $3,000 and you never see them again. There is no way in hell, ANYONE can promise that and remember, if it sounds too good to be true, then it is.
You are not alone and in fact there are millions in your same position!
The first thing you need to know is that you are not alone. There are literally millions of people suffering as a result of their mortgages and this housing crisis. Yes, SUFFERING! This is no game and I do not take this lightly. You shouldn’t either, but realize that you are not alone and you will get through this. One way or another.
Moe’s most important homeowner tip for mortgage help:
One of the first things that a homeowner should do is identify that the mortgage on their current property is a lawful one. Meaning that there are no Truth in Lending Act or RESPA violations and there wasn’t fraud involved on behalf of the lender or broker that originated your loan. If there is legal issues, then you can use these violations to your advantage and put the lender on the defense.
Red Flags and things to look out for in your mortgage loan. If your lender or mortgage broker violated the law, by all means, you may have found the holy grail to help you get out of your toxic or fraudulent mortgage.
Start by comparing the loan you got with the one you thought you were getting. Are the terms the same? That is, is your Annual Percentage Rate (”APR”) the same as the one you were quoted? Are your total monthly payments the same as you were told they would be? Is there a prepayment penalty, and if so, were you told about this prepayment penalty?
If you have refinanced your primary residence, that is, the home your currently live in, then the first thing you should look at is the “notice of Right to Cancel” which is also called the Three Day Right of Rescission. You usually has three days after signing loan documents to change your mind and cancel the loan.
The borrower must be told of this right in writing.
If the creditor fails to properly provide notice of this right to cancel, the right of rescission may be extended for up to three years.
When the right is extended for three years you can rescind the loan at any time before three years, meaning that the loan is treated as if it never existed. Essentially, you become entitled to all profits made by the creditor as a result of this loan. This means that the creditor must refund all interest paid, all closing fees, all broker fees, and even pay for your attorney fees. As you can imagine, this amount can be quite significant.
The extended right of rescission is a powerful tool to help borrowers who have been victims of predatory lending, and helping our clients exercise this right is often the first step in holding a creditor responsible for illegal behavior.
If you are the victim of predatory lending or mortgage fraud, then please call our sponsor, the Law Offices of Gregory A. Paiva & Associates at 888-432-6643 for a FREE consultation.
Gregory A. Paiva - “We use powerful laws like the Truth in Lending Act (TILA) and the Real Estate and Settlement Procedures Act (RESPA) to bring lenders to their knees. These laws MUST be followed and failure to do so can result in significant damages to the lender. So, naturally, they will be very amicable to working your loan out to more affordable terms to avoid costly litigation.
Many times the borrower is charged a lot of unexplainable fees and charges for the the lender cannot back up these charges. The Law Offices of Gregory A. Paiva & Assoicates, demand that these fees be fully documented to the penny and we insure that our clients are not being over charged by their lender or servicer.
We do not tolerate abuse and command respect with our thorough knowledge of the law. We are consumer and homeowner advocates that will protect you and your home.”
If it is determined that no laws have been violated on your mortgage, then it’s time to approach your lender for a possible loan workout or loan modification.
The factors they will look at to see if your are eligible for a loan modification are:
1. Nature of Hardship Causing Your Mortgage Problems
2. Ability to pay
3. Amount Owed
4. Equity in the property
5. Future financial situation
6. What is better for them. To foreclose or pursue a loan workout with you and or modify your loan. Meaning which approach will best benefit the lender in the long run.
Mortgage help can take form either via a loan workout or loan modification and this generally occurs where the parties to a problem loan mutually agree to workout the problem by creating new and better loan terms. The hope is that the new loan will enable to the borrower to meet their obligations.
Make the Plan and Work the Plan:
When applying for loan modification help, make a game plan on how exactly you are going to approach your lender or servicer. You need o plan for the worst and hope for the best. So, that means you are going to make 2 plans. 1 plan is to approach a loan workout plan with your lender and the 2nd plan is a “backup” plan in case your attempts to get a loan modification do not work. The 2nd plan is for your to prepare for the worst case scenario.
Understanding your lenders or servicers employees:
These people are trained in minimizing loss for their company and they get paid to by getting the most amount of money out of you as possible or declare that your case is un workable and foreclose on you. That is how they mitigate loss. If you understand this, then you’ll know that you have to approach them and all conversations very carefully. They are people just like you and they are just doing a job.
Many do not care much about anything but lunch and Friday’s. You have to befriend them and “win” their compassion and open ear.. My advice is to be as nice as you can to these people who answer the phone (no matter how pissed off you are at your lender). They have a tough job with hundreds of angry homeowners calling every day. Stand out and be the nice, calm and collective homeowner. You’ll be surprised that this simple tip will get you FAR!
The Mortgage HELP Plan:
1. Gather all your financial information and separate it into 3 categories
- Income - Any and all income. Wages, social security, child support, welfare etc.
- Assets – All real estate, 401k, IRA, stocks & bonds, autos, boats etc.
- Expenses - All expenses, mortgage payment, taxes, utilities, vehicles, cell phone, child care, insurance etc.
- Income & Expense Sheet – Now make a income and expense sheet with all your data. Here is a sheet to help you.
Your lender or servicer will ask you to fill out a financial statement and this is what the lender will use to determine if you are eligible for a loan modification.
2. Write a hardship letter. Here in an example hardship letter
You’ll need to provide this hardship letter, documenting the reason you are unable to afford the mortgage (or reason you have fallen behind) and the reason that you are a good candidate for loan modification. This letter will give your lender or servicer a clear picture and shows that you are a responsible borrower who has just suffered a hardship or a rate reset that is causing your problems.
- This letter is going to explain what is causing your mortgage woes and why you are having problems
- Make it short and sweet. 1 page to 2 at max. Remember you are sending this letter to an “employee” who is very busy and does not have time to read 5 page hardship letters.
3. Prepare for your first phone call:
- Here is a list of lender and servicer contact information
- Gather all the contact numbers you’ll need.
- Place your emotions to the side because this is all about “business”
- Place a smile on your face and get ready for the fight of your life!
The trick with any bank and getting a work out done is learning to navigate their phone system so as to increase your chances of getting a live person. Over the years I’ve learned some tricks that help, sometimes you hear options that you know will lead to a person like when it says “to speak to a representative press ___” but sometimes they don’t give you these options.
So, you have to think, what options WOULD get a live person. For example often anything that involves new clients signing up will get a live representative…because they always want new business. You have to be a little savvy though; you can’t just tell the sales guy you called them so you could get a warm body to answer the phone!
Once you get a live person, you want to be working your way up to a decision maker. This is sometimes harder to do for a homeowner than a 3rd party. Often with the homeowner they get stonewalled at the first level, and sadly the first tier in Loss Mitigation is really a glorified collections department. They are paid hourly employee’s who have very little if not zero motivation to go the extra mile and help you get some needed comfort and relief while resolving your problem. Often they just compound the problem by being rude and demanding, telling people things like “just pay your bills”. So it’s essential that you get beyond these people and to a specialist.
4. Document your efforts
- Make a separate folder for this and attach a “conversation log” or a “call log”
- Document every call, conversations, fax, letter, email on your call log
- This is very important in case you receive abuse and neglect from your lender or servicer. This will be your “evidence” in case you have to file a complaint with the Housing and Urban Development (HUD) or if your decide to bring a lawsuit against your predatory lender or servicer.
5. Do you have complaints against your servicer? Please do not take this abuse and understand your have rights that protect you from predatory servicing.
The Real Estate Settlement Procedures Act (RESPA) is a consumer protection statute, first passed in 1974. RESPA covers loans secured with a mortgage placed on a one-to-four family residential property. These include most purchase loans, assumptions, refinances, property improvement loans, and equity lines of credit. HUD’s Office of RESPA and Interstate Land Sales is responsible for enforcing RESPA.
Loan servicing complaints
Section 6 provides borrowers with important consumer protections relating to the servicing of their loans. Under Section 6 of RESPA, borrowers who have a problem with the servicing of their loan (including escrow account questions), should contact their loan servicer in writing, outlining the nature of their complaint. The servicer must acknowledge the complaint in writing within 20 business days of receipt of the complaint.
Within 60 business days the servicer must resolve the complaint by correcting the account or giving a statement of the reasons for its position. Until the complaint is resolved, borrowers should continue to make the servicer’s required payment.
Borrowers may obtain actual damages, as well as additional damages if there is a pattern of noncompliance.
Closing loan modification thoughts:
The MOST crucial element to this whole process is your Budget and if you have done your due diligence, you’ll be ready . They will ask you for a detailed list of your monthly expenses. If it’s too tight, you may not get approved, if you have too much extra income you are going to have an outrageous payment plan.
Don’t agree to it!
The 2nd MOST important thing you can do is DO NOT SPEND YOUR MORTGAGE PAYMENTS.
Often people stop making their payment because they are falling behind on other bills, or they can’t quite make the whole house payment. Over the years more often than not, the people I met with still have an income coming in each month, they just can’t meet all their obligations, so while the house is falling behind they take advantage of the fact that they aren’t paying the house payment in order to catch up on other debts. Sock away as much of that money each month as you can. Its crucial, here’s why;
If you don’t pay your mortgage for 3-4 months and your lender decides to negotiate a repayment plan or a loan modification, then they will want what is called “good faith” money for you to come to the table with. Typically this is from 30-75% and sometimes 100% of what you owe in delinquent fees and attorney fees. Often I speak with homeowners who spend all their money and have nothing to work with. If that is the case, then don’t expect them to work with you or you better have a REAAAALLLY good explanation and proof as to why you have no money to bring to the table.You can search for more homeowner tips under the category “Loan Modification” on the right bar of my blog.
Other great mortgage help reads from Moe to help you in your quest.
http://loanworkout.org/2007/10/19/should-you-handle-a-loan-modification-on-your-own.aspx
http://loanworkout.org/2007/10/18/tips-to-get-you-a-loan-modification.aspx
http://loanworkout.org/2007/10/12/loan-modification-success-story.aspx
http://loanworkout.org/2007/10/06/a-real-story-on-how-fight-for-a-countrywide-loan-modification.aspx
http://loanworkout.org/2007/10/01/example-hardship-letter.aspx
http://loanworkout.org/2007/10/04/fha-va-and-rural-mortgage-modification-information.aspx
http://loanworkout.org/2007/07/09/whats-a-loan-workout–repayment-plan.aspx
Contact your lender as soon as possible or have a competent third party handle it for you. There are non-profit HUD certified Housing Counseling Agencies in every town in America and also reputable for profit organization that can help you.
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we are in the process of loan modification with litton loan, the house is set to foreclose actually sell on mar 4, 08. we have been approved for a loan modification, just waiting on final papers from the attorneys, it is just very scary, because litton has not contacted the attorneys that have our house up for sale. they are telling us not to worry, they have to wait until a few days before it is to sell before they can call them and put the sell on hold. has anyone ever heard of anything like this? thank you
i need to know if you are going to help me with my loan on my house i am getting very worried about it i have been doing everything i can to keep making my paments i even got rid of my newer car so i would not have the car pament so i could keep paying my house pament because its more important my house payment keeps going up every six months all i am asking for is to give me a rate and pament i can afford so i can keep our house its all my eleven yearold son and myself has and i worked very hard to get it and i have been working very hard to keep it ihave got rid of alot to keep it so far please help us so we can keep our house if it keeps going up another time or so i dont know what i am going to do ineed to keep it and i know you all need me to keep paying so please help me so we all can win please i dont know what else to say just please help thank you darryl reed feb 24 2008
i really need help and fast. i am a married woman whose husband is very sick and i can’t tell him we are in trouble with our mortgage. i also take care of 29 abused animals. we are working on a retirement budget. many things have affected this bad situation we are in. many of my animals got very sick from a dorment virus one of the strays brought in. i get them checked immidiately for illness before i mix them with the others, but this was dorment and did not show up for several months. i have already paid a few thousand dollars to the vet, but still owe 7,000.00. i have been doing this for over 33 years and have been told previously by the loan people to just kill my animals and save the money. this has become our life and we have sacfificed to do this. also no one knows this and i can’t tell the loan company this, but in august of 2006 i was prescribed the drug Reqip made by GlaxoSmithKline for restless leg syndrome and the drug had not warning about sideaffects. well almost immediately i began to have uncontrolable urges to gamble and i spent house money on this. in december of 2006 i found out from a radio show that Mayo Clinic found that a serious side affect for some people from Requip is uncontrolable urges to gamble and also breast tumors. (i had 22 breast tumors removed in Feb. 2007 after never having any previous problems.) i contacted Sir Chris Gent in England. He is the Ceo for the drug company he just pushed me off to some lawyer in Triangle Park NC. after much to do they sent me a large booklet where is clearly stated that the gambling problem and breast tumors do occur in some people taking their drung requip. they got 5 years of my medical records that showed that i had never had these problems prior to taking Requip, but they refuse to do anything to settle for my hellish problems. this drug has literally destroyed my life and has brought me to the brink of suicide many times. it has also put me in this terrible financial situation. i found out that the FDA forced GlaxoSmithKline to put these warnings on the packaging in August of 2007, but i started taking it in August of 2006.
i feel that my situation is so hopeless.
GMAC is our mortgage carrier with the VA to back it up. the VA went and made arrangements with GMAC to put us back on a plan to make up a payment. originally our payment was 610.00 then the plan went to an outragous amount of 1,034.00 i couldn’t make the large payment after a few, so now they want us to pay 788.00 for over a year to make up for the missed payments and i just got this notice on 2/2208 and have to have the first payment to them by 2/27/o8. i am beside myself as this is to high. i have to pay the vet 700.00 a month and we both take a total of 22 prescriptions together. that is not counting all the other expenses. i really don’t have any extra cash around because of the bills. i told the va that i wanted a modification to a 40 years mortgage from the current 30, but this is what i got. she told me not to deal with people like you. i need help fast. we could permanently make a payment of around 550.00 and not get in trouble again. i also had to take out 8 payday loans to try to keep the house running while the gambling went on. i was hoping to put those down as debt and pay them off with money consolidated in the new mortgage. is their any hope. i have not a single person to turn to not even my husband and i don’t know just what i should do. the deadline of 2/27/08 is so close and i didn’t know about this until 1/23/08.
you must leave a very detailed message as i am usually taking care of either my husband or an animal. my husband can’t hear the phone and never answers it. i just dropped my long distance carrier to save money so i can’t get out on my phone unless it is a toll free number. i could pay you the $1,500.00 if we were to get the above stated modification or in payments. i had been praying that the drug company would come through with a settlement and i have that on my mind also. my e=mail is (removed by Moe to protect you against the predators). thank you in advance for any help. i don’t have a website, just an old computer.
PLEASE DO NOT PLACE YOUR PERSONAL INFO IN THESE COMMENTS. PREDATORS WILL PREY ON YOU. THANKS FOR THE HEADS UP SABINE – MOE
Anyone who needs help needs to post a message on the Loansafe forum, the link is right on the top, on the left hand side.
Please DO NOT POST YOU PERSONAL INFORMATION, SUCH AS YOUR ADDRESS, PHONE NUMBER, EMAILS, THAT IS VERY UNSAFE ON THE INTERNET!
The Dodd and OTS plans are simply transferring the subprime risk from the banks to the taxpayers. In essence, making the taxpayer the subprime lender of choice. Not a good idea at all.
The Castle plan will render written contracts useless. Further it puts the banks above the law. Yet another terrible idea.
I sincerely hope the Oversight Committee leads to a parade of Mozilo, Prince and O’neal, in handcuffs, on their way to life prison sentences.
All these actions will do is foster false hope that something is being done about the credit and real estate meltdowns. In response to the false hope, the stock market will rise as will interest rates, which will further aggravate our delicate situation. Meanwhile, nothing has been done to fix the problem and the markets have stalled the inevitable “adjustments” needed to move beyond this crisis.
I am frustrated that everyone is worried about the investors when the ones who are at fault with the problem foreclosure are those such as Litton Loan Servicing. An example is in my case. Litton is added fees to my loan which are taking out of payments which should be going to the loan and not to them. Example. A woman I know paid Litton 2500 dollars to catch up her loan which she got behind because she had cancer. She called Litton and they told her that is what she owed. She then received a notice of foreclosure a month later. Saying she is 3200 behind. When she looked at her statement she noticed the 2500 was disperse in this way. Instead of three payments which would have caught her loan up, they paid only one. Then 700 went to forebearance fee (which she was not under a forebearance plan and 1200 went to coorporate fees. None of this 1900 went to the payment of her home but to Litton Loan who does not own the note but represents an investor who owns the note. What is wrong with this picture you ask? Well lets see, not only will the investor have lost because the loan will go into foreclosure but will also lose when my friend files for chapter 7 bankruptcy. So if you want to get the fraudulent company – look up litton loan and you will not believe all you read. Many homeowners in Ohio, Michigan, Texas and many other states have loans of investors through Litton. Lets be fair to everyone and shut down Litton. They need held accountable for everything they have done. Lying, cheating, stealing, etc etc. Time for our government to put them to rest and make them accountable for putting investing and homeowners at risk. And the economy and those middle class are the ones who have to foot the bill. All loans litton has should be paid in full and investors and homeowners should be the winners.
Dear Federal Office of Thrift Supervision:
Home owners who owe more than the current value of their homes should continue to pay their loans, as they agreed to do. The owner would expect to get the full value of the increase if the value of their house went up. If it goes down, they should not expect someone to guarantee themselves against loss.
To any remaining free Americans:
Very soon, nearly every home in America that was purchased using a mortgage in 2004-2006 will be “under water”. All of these loans will be turned over the federal government under the suggestion of this federal agency that wants to expand. The point of all of this is to nationalize the home mortgage business.
Good points, homeowners can do most of the loss mitigation on their own. Sometimes the hardest part is dealing with the lender or even getting them to answer the phone and respond to voicemail. That seems pretty ironic since their collections department has no problem calling homeowners all day, but their loan workout department can’t seem to answer the phone or call anyone back. But if the homeowners can not get a call back, then a third party loss mitigation company will probably not have any more success. And the third party companies have far less interest in saving the home.
This is Clarks Loan Investments. We are into helping people get out of financial problems. Do you need a loan; do you have had credit but serious need financial help? Have you been turned down by banks and lending homes?. We offer out financial help to the public with low rates of 5% and from the range of $2,000 to $100,000 (Personal Loans) $20,000 to $5,000,000 (Business Loans) 100% Project, business and personal Funding with secured and unsecured loans available. We are guaranteed in giving out financial services to our numerous clients all over world. With our flexible lending packages loans can be processed and funds transferred to the borrower within shortest time possible. We operate under a clear and understandable terms and we give loans of all kinds to interested clients who are approved by our funds approving dept. More in formations about our firm contact us via email. Interested clients should please fill the borrower’s form below.
Borrower’s In formations
Name:
Location:
Amount Needed:
Country:
Phone Number:
Thanks for your time.
Clarks Loan Investments
E-mail: clarks_investments@hotmail.com
Boy Moe, sounds like you are assisting people in cheating the system. Two wrongs dont make a right. You should really think before you write about ways to swindle and steal.
I can understand that many of you are facing financial difficulties. What many homeowners do not understand is that when you hire a modification company to contact your lender on your behalf is that they are on the phone 2-3 hours a day making sure that all the documents provided are received, and in the process of being underwritten or being reviewed. I don’t disagree with Bob. This website state do not pay anyone to help you do your loan modification, but there are advertisement of attorney to review your paper work, and also this company founder also charges you to review your paperwork. There is no difference. There is a contradiction in the statement on this website. I have been in the mortgage industry for 10 years, and you will always have loan officers who come and go, but understand that because of people who cashed out their equity to buy new cars, take vacation, and over spent. The banks and people like me are suffering for it. You people are grown adults, and should know better! Bank over analyzed on the booming market, but it doesn’t mean you treat your house like a piggy bank and spend all your money and then blame the bank for what you spent your money on! I’m sure at 1 out of 10 had different situation. It’s like giving a drug addict to sell drugs. How could you expect the drug addict to sell his drugs and make a profit. It’s unfortunate that people who are responsible have to suffer for this situation! People with bad credit complain they can’t get even approved for a FHA loan. Do you seriously think the government can help people who are in this boat? Raising the conforming loan limits because people can’t support their monthly income.
If you think an attorney can help you stop your foreclosure, think again. Most attorney have their head up high. What makes you think their fees are reasonable? If you really deep where your like 10 months behind, the best thing to do is contact a bankruptcy attorney and file a chapter 13 right away! If you are working with an attorney on your loan modification, the chances are they will charge you addition fees to fill a chapter 13, if they are specialized in bankruptcy! the court charges their fees,and this is something not disclosed in this website.
Which 3rd party Loss Mitigation Companies are legit?
I have had a very difficult time. After fixing mold in my condo I took the equity and purchased a home three years ago. The realtor forged my escrow docs and we have been in litigation for fraud breech of contract and non disclosure for three years. I was three months behind in mortgage payments due to the cost of legal fees, mold remediation (realtor conspired with inspector she insisted to hire) and was not safe and 40 grand in undisclosed code violations. she was the dual agent for the guy in her office that was the agent seller owner and builder of the home. long story short. I have renters now in the house and live with my family. I can cover the mortgage that way only but am behind. they are calling 20 plus times a day and put it into forclosure it is in CA. I have 450 grand invested in the home which is everything I had. They promised on tape to renegotiate the loan if I made a good faith payment with an extra 40 a month. I did so. no new loan docs. april comes they claim they are on the way. I send another nearly three grand. two weeks ago they call the note saying if I dont cure the 19 grand default (4 grand in fees) that they will foreclose. I asked about the renegotiation and they told me that the rules had changed. they milked me for an extra 6 grand. what do I do? ready to lose it all in CA
Clarks Loan Investments is listed as a scam online. About half way down the page:
http://www.data-wales.co.uk/ni_fake_loans.htm
Barr Donald frank, psfcb_loanoffer@yahoo.it, NO 5 Adeola hopewell, Victoria island, Lagos, Nigeria. Matheu Hilario, chublenders1@hotmail.com. Clarks Loan Investments, clarksinvestments.com. Nalcfl Finance Inc, nat_alanf@hotmail.com, Alan Franklin. Derrick George Telling, , communitytrust@gmail.com, Rev. Antony Jones.
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