“Servicers routinely capitalize delinquent interest, corporate advances, escrow advances and attorney fees and other foreclosure-related fees and expenses into the loan balance when completing a loan modification,” the report says.
In other words, the modification process usually allows lenders to tack onto the principal previously missed mortgage payments, as well as other fees incurred during the modification. The borrower may get to pay smaller payments each month, but those payments may be stretched out over a longer period, amounting to a bigger total balance owed in the end.
Unfortunately, given current house prices, increasing the unpaid balance of the loan also increases the likelihood that the borrower is underwater — meaning that the homeowner owes more than the property is actually worth.
Read more from the NY Times
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I applied for a loan modification through chase bank back in October 2009, as many individuals in these trying times, I find it harder and harder to make my payments. I’ve never been late!, always on time.
I’ve sacrificed necessitates simply to pay the mortgage, I’m self employed and find that might have been the one issue i was turned down for modification.
Within the process of dealing with Chase bank has been extremely bumpy, I submitted all the forms required, they kept
asking for documents I already sent, two, three four times.
When contacting chase via telephone (several times) the conversation starts out friendly, but ends up in a vicious cycle going nowhere, when requesting to speak to a supervisor, one is never available, and then asking for a return call from a supervisor
ASAP, the call is never returned. Three times I was hung up on by Chase bank.
Now nearly four long gurgling months later, I’ve been turned down.
I’m not asking for a free ride, simply a little help to stay in my home.
$75 BILLION DOLLARS was dedicated from the US government to help people like me in my situation, yet Chase bank slapped me and my family right in the face.
I guess Chase bank would rather let my home go into foreclosure then lend a hand.
Anyone with similar circumstances with any advise would be greatly appreciated.
I can’t offer any advice, Otis. Just a similar tale with Wells Fargo. They claim I have over $2000/mo surplus but they only look at gross income, not net. My “surplus” is the taxes I pay every month. They offered me a loan modification alright. Only it raised my monthly payment from $1960 to $2348 and increased my interest rate from 6.7% to 6.8%. Their response to all of my questions, “if you don’t like the deal, just reject it”.
I think we all need to start a Class Action Suit against banks, they hurry to put you into foreclosure so they can get more money and fees at the end of the loan; The banks got ticked when Obama told them to start making Final loan mods so they said Ok we will but the hidden agenda was to keep adding fees on top of fees the govt and homeowners have to pay at end of loan. They are not helping homeowners they are helping themselves to a Platinum Ticket. Which they received from The bailout plus foreclosed home that appraise for more than they say for when economy comes back and homeowners who are indebted to the banks for life.