Officials from the Treasury department met with lenders yesterday in yet another attempt to get them to step up the pace of loan modifications. As of the end of September, 14% of all home owners with mortgages are either behind in their loan payments or in some phase of the foreclosure process. This is a record level of mortgage delinquencies, for the ninth straight quarter.
The big banks, for their part, continue to blame home owners for their failure to assist home owners with the modification process.
All is not bleak and awful. There are actually some lenders, primarily the lesser known smaller lenders, who are working actively and aggressively with homeowners to assist with modifications and actually process these loan workouts in a very short timeframe. For example, if you are one of the fortunate borrowers with a mortgage serviced by PNC Mortgage, you most likely can negotiate a 2 year reduction in your rate, have late charges forgiven, and be on your way to a workable payment schedule with just a phone call with one of their loss mitigation specialists.
PNC is a glowing reminder of a bank committed to working with borrowers who have fallen into a hardship situation. In sharp contrast, Bank of America advertises on their website that extensive documentation is required. will offer at best a 3 to 5 month trial modification after 30-45 days of review of your documents. What isn't advertised is that a final disposition of your loan modification, if in fact you ever get one, is likely to still either revert your loan back to pre-trial modification terms, or result in a notice of default being filed against you.
B of A, like many of the big banks find excuse after excuse to NOT qualify borrowers for modifications. Excuses range from "too much equity" even in situations where the home owner has two mortgages and the combined mortgages put the borrower under water for equity, (The second mortgage is not included in the equity calculation), to the borrower never filled out all the paperwork or filled it out incorrectly. If this is such a huge issue, why doesn't a bank with literally thousands of branches across the country, put people into the branches to work with borrowers in need of assistance. There are certainly abundant unemployed people across the country who could be hired to help.
The paperwork being requested is not difficult to compile and send in. However, the modification agreement must be signed and notarized, and this is where many homeowners seem to fail, according to bank spokespeople. Most banks do have notary service available, though you will very likely have to pay for the service. Also, title companies and law offices should all have notary service available.
What is difficult to comprehend is why banks such as PNC can accomplish in an hour what some of the bigger banks can't manage to accomplish in a year. Processing of modification paperwork is really not all that different from processing a loan application.
The Treasury department has indicated that the banks must now report to the Treasury on the status and final decision on all of the 650,000 trial modifications in process. Failure to report to the Treasury department, in what the Treasury is calling "servicer accountability" can result in fines to these lenders. As of last month, less than 2,000 of the more than half million modifications in process had been converted to permanent modifications. Many of those borrowers ultimately lost their homes to foreclosure.
There is considerable criticism of the HAMP (Home Affordable Modification Program) as it currently exists. It was initially designed to help 3 - 4 million homeowners, but there are now more than 7 million delinquent mortgages in the pipeline.
Freddie Mac, one of the largest holders of mortgages, has hired an outside company, Titanium Company to send real estate agents door to door to assist homeowners with filling out required documentation for modification requests. But, even if filled out correctly, will the banks continue to "lose" documents that are sent to them again and again?
And, like so many programs that have been rolled out, this one still leaves out those who have been trying for months, and even up to a year to get a loan modification agreement of any sort.
Analysts estimate that this foreclosure crisis is likely to continue well into 2010 as unemployment numbers continue to rise and more home owners find themselves with loans they cannot pay.
The Treasury department is working to find means to help the struggling home owners by making more aid available.
Home owners who think they should qualify for assistance can call 888-995-HOPE or visit the website www.makinghomeaffordable.gov to learn more about what help might be available. You are advised to visit the site often as hopes are that more organizations and more assistance will be offered soon.
If you have an experience, whether positive or negative, that you would like to share with others, please leave a comment below. It is especially good to hear from those who have positive experiences to share, such as that report about PNC Mortgage. Borrowers with loans with PNC might not have realized how near help is for them.
Resource: US to push lenders to Modify loans
Comments
how about trying for 18 months. Bank of America has no intention of helping anyone. and the government is looking the other way, pretending to be interested in helping. shaming the banks? what a moronic idea, what do they care. they all go home and sleep very well thank you. they could care less.thanks Mr. Obama for the help, when is your next vacation coming up?
How about talking to Bank of America about me struggling month by month to pay my mortgage. I have perfect credit score, reduced but consistent income and low unsecured debt but "since I'm not behind in my payments yet" they can't help me. Their priority is to "people that is missing payments already"
Funny because people that fall behind is not getting help anyway. WHERE IS THE TAX PAYER'S MONEY YOU GOT TO "HELP US" BANK OF AMERICA?
BOA sucks! Our mortgage was owned by Countrywide. They were great. Beware when calling BOA. I could hear other callers talking on the phone givng personal information regarding their loan, bank account numbers, SS#, and insurance information. When I told the Customer Service Representative she laughed. My husband had the same experience. It really stinks, because I could only modify my Payplan by phone. I could not modify it online since BOA took over.
I submitted my loan modifications application since July of this year to BOA and not getting any help. I complete all documents as the way they required and waiting patiently. I really think that the treasury should review this bank thoroughly for their modification process priority. It is terrible for a home owner like me who struggle each month to try to pay them on time to have to wait for 5 months and still not hear a single answer from them. I really agree with you all that BOA not actually out there for helping us.
I have been trying to get a loan mod with Bank Of America since July 09. I have even hired a company to represent me but still no answer. They are so full of bull. They lie to people. What do they think that people are stupid. I am not going to give up. I am going to fight to save my home.These people have no morals or values. They will have to bring the military to get me out. i am so sick of the lying.
Hi Congressman Farr,
Somehow I feel as if I should address you as Sam, but today let's let decorum stand.
My Issue is this, "The Bank (PNC) that holds my mom's HELOC has shut it down because she had one payment that was within the grace period, but which PNC now regards as a late payment." That is it! She will now have to move in a short amount of time, and sell her home of the last forty years. She is eighty five, and her home far exceeds the value of her outstanding loans.
Mom was a top of the line educator, teaching locally at Aptos in the seventies and Harbor high in the eighties. And finishing up with the ROP program. When she is out shopping there will usually be at least one past student that will approach and thank her. Sometimes it is the parents of students thanking her.
I qualified for HAMP, fulffilled my reduced payment "trialperiod" and was strung along for 8 months.
During that time, I repeatedly called Citi trying to find out what the problem was and was never able to speak with any of the 5 counselors assigned to my loan mod. Finally on December 28th, 2009 I recieved a letter from Citi stating I did not qualify for the HAMP program and that my account is now delinquent nearly 3,000.00 due to the reduction of my mortgage payments over the past 8 months. I am now in a much worse situation and am being threatened with foreclosure when I wasnt delinquent when I entered the program! Citi did contact me today by phone ( finally) and advised me to resend my financial info ( again for the 3rd time) they would see if they could do a different type of loan mod which might include converting me to a 40 year note which of course would have some up front fees OMG - I am 50 yrs old. Decision now is to default on my mtge or other debt.HAMP is a cruel joke.
Hi all,
I just wanted to say that PNC/National City Mortgage does not modify loans. I have sent my loan modification request to them two times and both times was rejected. The first time in March 2009, they told me that PNC does not do loan modifications. The second time, today, March 10, 2010 PNC loan negotiator told me that my request was denied because my mortgage loan is own by private investors. I am still current on my mortgage payments but not for long because my severance package will be gone in a couple of months and have not been able to find work. Any advice?
My mortgage company is Midland Mortgage. I have been trying since 12/2008 to get them to lower my mortgage. They refuse to do anything to help me. I had a reduction in income and asked if they could modify my loan by reducing the principle and the interest rate and was told it could not be done. I ended up filing bankruptcy in March of 2009 and have been paying it along with the mortgage. In October I was given permission 2 bankruptcy payment in order to purchase and have a water heater installed. In January 2010 the bankruptcy judge dismissed my bankruptcy because I had missed 2 payments (the 2 they gave me permission to miss). It was reinstated in February 2010. I continued to make my mortgage payments on time. They returned my January 2010 payment and after the bankruptcy was reinstated I sent in January, February and March 2010 payments and the Midland Mortgage returned the payments. I am waiting to hear from their lawyer as to why they keep refusing my payment.
This letter concerns Ever home Mortgage. My loan was transferred to Ever home mortgage about three years ago and everything was good. I was paying my mortgage on time and someone that was living with me paid the taxes. The person that was living with me left and I was unable to pay the taxes without help. I faxed Ever home Mortgage and asked for help with the taxes which they complied. Now here is the problem:
Ever home Mortgage put $20,000 in an escrow account to pay the taxes and insurance, by the way I never asked for the insurance to be in escrow. When I received my new payment from Ever home Mortgage the payment went for $1479.04 to $3926.38 per month. They added an extra $2446.34 per month to cover the escrow, which made my mortgage payment unaffordable. I contacted Ever home Mortgage and asked about the making home affordable program. I stated that I needed to be put in the modification program or to add the $20,000 to the end of my mortgage and let me pay the principl
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