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Does anyone know how to get a loan modification when you are not in default?Thanks, Jane

  • April 05 2009 - Carmel Valley
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Answers (24)

A friend of mine did a loan modification with his Lender with out being in default and he was in a option arm product. 2 reasons they did it. His wife passed away  (Hardship) and he was in an opton ARM. He called them faxed over documentation and it took about 6 months to process, meanwhile he was still paying his mortgage and saved the upfront fees that Loan Mod companies are charging (nothing against Loan Mod companies, there are reputable ones out there). Guidelines change everyday in the industry and a few lenders have changed their Modification guidleines. Banks will not work with you. They do not want you to go in default and they do not want you to foreclose. And is most cases its not the bank that doesn't want to work with you its the investor. You may not be eligible for the Home Afffordability Stability Plan but ask your lender anyways. Before the plan there were only 5 options now with HASP there are 6. 1.Refinance  2. Forebearance 3.Home affordability 4.Loan Mod 5.Short sale 6. Foreclosure. I also advise you to contact a Mortgage Loan consultant request a time to go over options face to face. Customer service numbers are good to find out general information, but not specific information that you are looking for. I wish you the best.
  • April 17 2009
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Profile picture for sthenderson

I got the same go around with my bank Wells Fargo -said I didn't qulify. A friend of mine told me to call this law firm in los angeles that did her loan modification. They charge a fee upfront but to me it was worth it because my bank wouldnt help me.  My payment was reduced from $2700 a month to $1439.  They took care of my late mortgage payments too. 
Call this number  213-355-5966. Her name is Tara maybe she can help you too.



  • April 17 2009
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If the loan is an Option ARM, it will not be eglible for Making Home Affordable plans, it is not a Fannie Mae loan.

The servicer is important here.  In California there was a settlement last year from a lawsuit for Countrywide loans, so if they have your loan, you might have an angle there.

The majority of Option ARM loans currently have extremely low interest rates right now.  5% or less in most cases.  If your loan was World Savings (then became Wachovia, then Wells Fargo), then your rate might be closer to 6%....but still these are already very low rates.  So what exactly would you expect the servicer to do if they are already charging such a low rate?
  • April 14 2009
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Profile picture for savalencia

With the Making HOme Affordable Plan, you should be able to without any problem as long as you qualify.  I am in the process right now.  You can try this website:
http://www.homeaffordplan.com/

as a preliminary test...  Then contact your mortgage company ASAP and tell them you want a loan modification.

  • April 14 2009
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From my experiences it is very hard for the consumer to directly deal wit hthe lender and get a Loan Mod. if they are not in default.  If you would like to save your credit and get the Loan Mod. going I would reccomend you go through a law firm.
  • April 13 2009
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Profile picture for Mrs.. and Mr. G
Our condo is worth $100k less than what we purchased it at and we are in negative amortization.  When we tried to do the loan mod with the lender, after 6 months we were told no.  We called, emailed, got the name of the manager, and that didn't help.  Not sure what else we can do.
  • April 12 2009
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Profile picture for BobPhillipsRE
Here's the link to see if you can qualify for either a refi ( if your first mortgage doesn't exceed 105% of your home's present value.) or a mod:

Find Out If You Qualify For the Making Home Affordable Refinance or loan modification

To see if your mortgage is with Fannie Mae: http://www.fanniemae.com/homepath/homeaffordable.jhtml

To see if your mortgage is with Freddie Mac: http://www.freddiemac.com/corporate/buyown/english/avoiding_foreclosure/avoiding_foreclosure_form.html

Loan mod self assessment tool:  http://www.financialstability.gov/makinghomeaffordable/.

Good luck in finding solutions - that are FREE.
  • April 12 2009
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You can still request a loan modification; however, priority files for the case workers are borrowers that are in default.
  • April 11 2009
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''you have to be relentless with your lender and don't take NO for an answer. ''

That is the key right there. Couple that with your actual real hardship and it's on. But if it's  'my home value went down i want a loan mod' forget it. 
  • April 11 2009
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makinghomeaffordable.gov is how you can get legitimate help. as for the guys who is "licensed"...I cannot speak for him or his area(he may be completely reputable, i'm not here to bash anyone),
but in my are there is NO license requirement, which is why there are SOO many scam artists out there. just be careful, loan modification is something you CAN do yourself, you have to be relentless with your lender and don't take NO for an answer. 
On the MHA website there is a link to find out if you qualify, start there. The fact that you have an option arm is good reason for them to work with you. From what I read, you have a couple of other hardships to deal with too. But like the rest said, you have to qualify for the new payment. If you do not, check back in with us!

  • April 11 2009
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Its funny how the "loan mod" scam artists come out like roaches.

Mr and Mrs G, Larry is right. The fact that your loan is an ADJUSTABLE rate negative amortization loan is enough "hardship" that your lender should modify it. You do not need to show income loss and the fact that you are paying on time or can afford the fully amortized payment has nothing to do with it.

You need to contact your lender again and be persistent. Painfully persistent. Before a week ago you had to be late on your mortgage for the lender to listen to you. Now that the MHA plan has started there is a lot of pressure from the federal governtment for lenders to modify and fix these bad loans. You do not need an atty or a "professional" loan mod expert to help you and especially not one that charges 3-5k up front. Beware of these scam artists as 3 years ago they were selling these loans in the first place.
  • April 11 2009
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Roy Mason, "Loan Officer Boy"---
Spamming isn't cool and your logo looks like a 4th grade art project.

Have a nice day!

---Boz
  • April 11 2009
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Roy stop the spam
Mrs G..call your lender and ask to speak to the loss mitigation department. Explain your hardhsip and ask for your options as far as a loan mod. If you qualify they will ask for your income and expenses and for a hardship letter. The will then submit your reuqest to the investor on the loan. Chances are your bank is just the servicer and there is a seperate investor that funded your loan. Your options are up to the investor. Calling your lender is step 1 before seeking aid from an attorney. Stay way from scam artis loan mod agecies that have recently popped up everywhere. Most of them are scams. Good luck.
  • April 11 2009
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YES , you can call your lender, ask them what they need from you. Sometimes they dont give it much attention or take you to seriously when you are not behind. Keep bugging them

YOU should also call the hope program ask for their home,

i can do prequal through a licensed Loan Mod company. I always advise my clients to try it themselves, and to contact profesional thats LICENSED to do loan mods

Good luck

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  • April 11 2009
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If you are in a hardship or you are inticipating one like a job loss or soon to be laid off.  Your lender may be willing to work with you now rather than waiting until you are in a crisis situation.

Mike Kench, Loan Mod Advocate

  • April 10 2009
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  • April 07 2009
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Can you afford to pay the 30 year rate that is on your options to pay your mortgage statement every month? If they take you out of the pick a pay your income has to be able to afford that payment  If you can only afford the mininum payment right now it's going to be tough to modify. If you can afford the payment and you just want to get into a fixed rate a mod would defintely be possible but they would not include the heloc.

  • April 06 2009
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Profile picture for Mrs.. and Mr. G
Hello Larry,

Yes, it's a pick-a-pay loan, interest only option with negative amortization.  Luckily, the large change won't happen for another 5 years, but we would like to refi/modify, whatever loan option there is out there to find a fixed rate to eliminate losing this place when the rate does change.  Just like all the others that have lost their homes, I am trying to prevent that from happening in advance.

Now another hardship has come into play that one of our moms (we taking care of both) will be living with us.  Our condo can't accomodate 3 people, therefore we hope to purchase a home.  We can purchase a home for less than what we paid for this condo and the interest rates are very attractive.  My dad is going through a divorce and will be renting our condo, but if the interest rate goes skyhigh, I can't imagine kicking out my dad. 

That's why the questions on re-working our condo loan and the reason for purchasing a home.
  • April 05 2009
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Profile picture for Clearpoint
You have an option arm?  That alone should get you a fixed rate modification.  They will not incorporate your HELOC into it but they should convert your 1st into a fixed rate product.  In my opinion that loan product was a death trap and should never have been given to 99% of the people that had them.  The Banks paid Brokers 2 to 3 times what they would be paid on a amortized loan so steering people into these products was rampant.  You really have two choices as I see it.  The first one is to be persistent and contact your lenders mitigation department.  State that this loan is negatively amortizing and you as well as they are loosing every month.  Your other option is to contact a modification company (I detest them but you may need a good one) and let them know your loan program.  These exotic programs have a lot of issues and good lawyers can help force the issue though I don't think you should have to.  Most lenders now are doing anything possible to get people out of these loans especially in your area.
  • April 05 2009
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Profile picture for Mrs.. and Mr. G
We are just trying to combine our interest only loan with negative amortization and HELOC into a fixed rate.  The lender won't even talk to us because we aren't in a hardship.  We can't refinance because our equity is completely gone. 

We are looking to purchase a home because we are taking care of both our mothers and one will be moving into our home soon.  The condo is too small and we will have a new expense for elder care.  Therefore the hardship has come into play.  But we are just trying to get a fixed rate loan.  But the lender won't even talk to us.
  • April 05 2009
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If you can afford the payment there is no reason for a modification.  If you want a better rate that is a refinance process which may be an option.

  • April 05 2009
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Profile picture for Clearpoint
The key term is HARDSHIP.  Why are you having difficulty making your payments? 
  • April 05 2009
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Profile picture for Mrs.. and Mr. G
The lender is completely unreasonable.  I took 6 months to get an answer back.  A year ago, our condo was appraised by this lender.  We started the loan modification in October 2008.  In January 2009, they said it had to go to another underwriter because they just realized it was a condo.  When you have a #19 on the address and their appraiser went out earlier in the year, you would think they would have known that already.  Then we get the you don't qualify for $328k, but I have no problem paying the $405k from the original loan.  They won't do anything because I'm not in default.  And then they tell me I can't borrow against my HELOC, which I never have, but it was another jab from this lender.  They won't do anything until you default.
  • April 05 2009
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Call your current lender.  The modification may be available if your current payment can be show as a hardship due to change in income etc.
  • April 05 2009
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