In addition to Real Estate, I also work for a loss mitigation company assisting homeowners in getting all the documentation in for loan modification.
I was meeting with some homeowners tonight, and what I found out estounded me.. When you enter the HAMP program, you are giving a "trial period" for making payment, while your modification is being processed. These homeowners had never been late on a payment, but the husband, who was self employed, had seen a sharp decrease in his earnings..and they wanted to head any problems off at the pass.
During their trial period,, they have not missed one payment, HOWEVER....the payments received during the trial period ARE NOT BEING APPLIED TO THEIR MORTGAGE...they are being held in escrow..in the mean time... THEIR MORTGAGE IS NOT BEING PAID AND IS REPORTED IN ARREARS.....consequently.... they are 6 months behind and their once stellar credit is gone!!!!!
Not sure of the logic of this...why destroy someones credit who is trying to keep their head above water..... If you have clients who are working on a modification..... they need to read the fine print
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Konnie, My sister looked in to this and when they told her she had to be late to get help she told them NO WAY.
the payments ARE NOT BEING APPLIED TO THEIR MORTGAGE..." amazing program. Very interesting post. Very misleading. A bit spooky.
Konnie - Thanks for the warning. I have a client who entered the program but said his payments were applied to his mortgage during the trial period.
Thanks...I will be calling Wachovia tomorrow AM discussing a clients options under the HAMP program...
Wow, what a great help huh??? I tell ya you just can't win. I'm not sure in what twisted way they think they are helping people. I keep hearing all the horror stories about loan modifications. Its really too bad. Great post, thank you.
Konnie ~ I have tried to help many people and the banks don't really care. It easier to file bankruptcy, wipe out the cars debt, home and credit cards for a cost of $1000 to $2000. It is craxy, but the simplest as easiest solution than trying to be good and save your credit, I think that;s why more people area shopping at the malls. lol.
Konnie, Yikes! Remind me to help people stear clear of that program!
Some of these programs can be very harsh....case and point!
Konnie, Great information. It doesn't sound like a program that I can recommend.
Konnie, After reading the post, i looked up more information on the web. First, I found the administrative website for the program (www.hmpadmin.com) and here is what it says :
This site provides mortgage servicers with the information and tools needed to participate in the Obama Administration's Home Affordable Modification Program (HAMP) and other program updates related to the Making Home Affordable (MHA) Program.
The italics are mine. Now I understand -- it is a typical government program and my personal belief that the last thing I ever want to here is, "We're from the government and we are here to help you."
The next site that I looked at was a fact sheet from Freddie Mac and one of the qualifications is:
"Borrowers may be current or less than 31 days delinquent and in imminent default with a hardship that can be documented, or 31 days or more delinquent."
Now I am wondering what type of borrower there is who isn't current, 31 days or more delinquent or less than 31 days delinquent.
Between this being an administration program and one administered by Fannie Mae and Freddie Mac -- I think anyone who is considering it should change their mind and run like H***!
Konnie - I feel their pain and frustration. The other problem is that if the bank does not modify the loan they have to come up with the original payment amounts AND LATE FEES to get current again. What a farce!!
Konnie Thank you for the warning. This is the first time I have heard of this. I am going to forward this information on to my agents. Thank you again for the heads up.
Dave
Thank you for this info, because we need clear understanding:
I am trying to assist a family member in this situation and he and i are both confused. He is about 2 months behind on his mortgage and his current mortgage company says they are trying to enter him into this program, but only if he pays the rears 2 month payments and current payment. They also said that he "MIGHT" or "MAYBE" he will qualify, but they're not for sure if he qualifies. My question is.... He spoke with some other Mortgage company of some sort and they informed him that he qualifies immediately. They insisted that he give them "CHECK STU BBS, BANK STATEMENTS, W-2, and ect... " . But they also needed him to pay $500 to get the process started... hummmmm.. I told him not to trust this company without further research, because i thought these modification programs and or the"HAMP PROGRAM " was done with your original mortgage company and not a private company that has no affiliations with his current Mortgagor..... can anyone help us please...
Another bank rip off in the guise of a helping hand.