BiggerPockets

Shari, don't know if this would be of interest but I have a co-worker who has a unique experience. Of course she contacted me just recently for advice after the fact. She became delinquent 4/07 and repeatedly contacted Countrywide for three months requesting a loan modification. When her husband found a new job in July 07 she tried again. Repeatedly Countrywide told her no to a loan mod. She gave up. She stopped paying the mortgage and the property was foreclosed in mid-2008. She moved and rented an apartment since she had no other hope. Her home was listed for auction in 9/08 and did not sell. Countrywide I suppose in the interim sold the loan or property as an "asset backed security?" to BNY. Well life went on for her, obviously heartbroken. Suddenly last week she receives a letter from Countrywise offering her a loan mod. They offered her in writing an interest only loan for 10 yrs, lowering the interest rate from 7.75 to 4.87 and tacking on the $50K in unpaid payments, escrow payments, legals etc. to the back end of the loan!! The house is now worth about $200K, she paid $275K with initially $255K financing. If she accepted this deal her new loan balance would be $305K. I can't believe how screwed up some of these lenders are.

Shari, I to have a story. After about a year waiting on the bank, this investor/friend is treating it as a business decision, which it should be. Bought the house for 300 has a current value, around 100 and can only get 950 a month for rent. Costing him around $2000 a month to keep a tenant in. The bank with all their wisdom can have it!

I'd be curious if anyone has been successful forcing a loan modification by using the "prove the note" strategy.

That is why this topic is called ...
[ Has your bank denied your loan modification request?]

Not, Lets have another happy story.

Josh, please explain the "prove the note" strategy

Thanks in advance

I heard of a guy who was able to pull that off for 2yrs.

I'd like to hear more about these strategies

John,
Your comments are exactly why I started this topic because the banks have got everyone brainwashed that they are trying to help, and that they are modifying hundreds of thousands of loans without mentioning that a modification can result in a higher payment.

For all of you that have a friend or client, or self, who is willing to be interviewed, please send me a private message with contact information and I will forward it to the reporter.

Ingrid, your story is ideal! It also happened to someone I know. So it probably happens fairly often.

Tell your friend to google loan modification complaints and any lender's name and she'll find tons of people willing to discuss their frustrations.

The client I just signed up this week tried to work with ASC, who is owned by Wells Fargo. He sent in the requested income and expense worksheet, and they told him he didn't qualify for a hardship modification because his expenses were larger than his income and he'd need to change that to show positive income. Well, that advice would get him denied a modification. Whether they did that out of ignorance or malice I don't know, but it' scary when your lender is giving you advice that will cost you your house. As it stands now, he should get a meaningful reduction in payment, hopefully a full $1K off. [I do business mostly with California, and the average person I talk to is inverted by more than $150K]

John,
Your comments are exactly why I started this topic because the banks have got everyone brainwashed that they are trying to help, and that they are modifying hundreds of thousands of loans without mentioning that a modification can result in a higher payment.

No question Shari! Isn't that the truth. What they are also not telling people is that the default amounts are often placed on the back of the loan, increasing the principle, not reducing it.
The only way I know a homeowner can be successful at this is to find some major violations in RESPA and especially TILA so that they have some ammunition to fire at the bank to restructure the loan.

In response to GHall. Chase will do loan mods for Chase, WAMU and EMC (previously Bear Stearns) loans only. Chase owns all these banks now.