The last blog I wrote, http://www.zillow.com/blog/mortgage/2008/10/25/the-new-breed-of-scam-artists/, was a little on the abrasive side. Why? Because Loan Modification is a new, untested industry and consumers should approach any ‘opportunity’ to better their situation with much caution. Since I am a cynic at heart, it was natural for me to question every little facet of the new “business”.
One example of the abuses that are occurring can be found here: http://www.latimes.com/business/la-fi-scam5-2008nov05,0,7629587.story.
As I explained to a couple of people who felt I was attacking their own credibility, I was merely pointing out what the reality is. People that have no business offering advice are taking people’s money and running! So, consumers, be careful out there.
I have also decided to start offering loan modification because I do absolutely feel that people can benefit from the process, and I DO trust myself to help them. I think my cynicism and apprehension comes from not wanting to ‘refer’ people elsewhere, and have them come back in worse shape than when I sent them out of the door. I have done my homework, and found a company with an actual track record of getting things accomplished (what a novelty!!) and that even offers a money-back guarantee. To me, that’s a good fit.
This is a new thing for me, and I am sure it will be an adventure. I will post here on my first clients- with their permission. It should be an informative few blogs. Of course, i will continue originating new mortgages as well. I have an excellent customer service record, and I don’t intend to squander that.
Good luck to all who are making a REAL effort to help consumers, and good luck to those people who find themselves in horrible situations with very little hope left.
Jennifer Monastero
Citizens Community Bank
Last 5 posts in Loan Modification
- Loan modifications are lowering monthly payments - October 4th, 2009
- More Homeowners are Late on Their Mortgages - September 21st, 2009
- Successful Short Sales…I mean plural…more than one! - September 14th, 2009
- FHA Mortgages Now Qualify For Government Help - September 3rd, 2009
- Loan Modification Slowdown - August 28th, 2009
- Stumble it!
- Categories: Loan Modification, Mortgage Types, Refinance
Comments
8 Comments so far
Brian Brady
“So, consumers, be careful out there.”
That’s the best advice I’ve heard you give, Jennifer. The whole world would be a better place if consumers took the time to perform the proper due diligence. Licensing or designations will never truly protect consumers from the bad apples in our industry. Consumers, do your homework and select originators in whom you CAN place your trust.
Trust NONE OF US… until you can, does that make sense? Don’t trust Jennifer…until you’ve read the advice she gives on her Active Rain weblog and her contributions to Mortgages Unzipped. Do NOT trust me until you’ve done the same.
Call us. Question us. Read the disclosures we provide. Challenge us. Do YOUR homework.
“I have also decided to start offering loan modification because I do absolutely feel that people can benefit from the process, and I DO trust myself to help them. I think my cynicism and apprehension comes from not wanting to ‘refer’ people elsewhere, and have them come back in worse shape than when I sent them out of the door.”
On the surface, this might appear to be an incredibly arrogant statement BUT IT ISN’T. Those of us in the know are confident in our ability. So confident that we offer the transparency of information about us, on the internet, for you to perform your due diligence. I know Jennifer to be an excellent choice for loan
modification not because she’s an expert but because she’s honest. While you’ll see me publicly disagree with her I know her to be passionate about her desire to help consumers.
Don’t trust me. Don’t trust Jennifer. Don’t trust ANYONE…
…until you do.
I’ll quote our friend Dan Melson, in the way he closes all of his posts, on Searchlight Crusade:
Caveat Emptor
Ginny Holmes
For those of you who don’t trust anyone but yourselves, I am here to tell you that you don’t need a professional to negotiate a loan modification. I am a homeowner and have just completed a short refinance on my own. A short refinance is like a short sale, only you are the one buying your own house at a reduced price. It’s not difficult at all, you just need patience, lots of it.
Contact your bank, the bank will fax you a list of the information they need from you, you gather your paperwork fill out their forms and fax it all over. Once you clear one level, your file is sent to the next level, then on to a negotiator, and finally approval from the investors. The whole process took about 6 or 7 weeks, but in the end it was well worth it.
Good Luck to you all.
Jennifer Monastero
Brian- very true.
Ginny- Good for you!
It can be done on the consumers end, but I am wondering if the lenders offer the same deal to “unrepresented” people. Care to share the details of your situation?
Ginny Holmes
Sure, I’d be happy to.
When our household income dropped by about 35% within the last 6 months we knew we wouldn’t be able to hold on to the house for much longer so we made the decision to sell.
Although we live in an upscale area in Southern California,I was shocked to find that because of a foreclosure in the neighborhood, the value of our home had decreased dramatically. I researched my options and we decided that a short sale was the only way we could go.
I called my lender and asked for information on the short sale process. The representative asked me if I really wanted to sell my home or if I preferred to stay. I told her that of course I wanted to stay in my home but that I just couldn’t afford the payment any longer. I was very pleasantly surprised when she told me not to do a short sale but that I could do a short refi! She told me that the bank would rather keep me in my home and sell it to me at a discount than to sell it to someone else at a discount.
I completed the bank’s Financial Workout Package, wrote a Hardship letter, secured a loan that we could afford and sent all these documents along with my new loan approval (from another bank) to their Loan Mitigation Dept.
The bank ordered a BPO (appraisal) and used 90% of the new appraised value as their sale price. After some negotiating, we agreed on a payoff amount and received our approval letter/payoff letter.
We now have a new loan that we can actually afford!
I need to make it clear that we had not missed any payments when we started this process. We had a conventional, fixed rate loan that we just could not afford any longer. If we had missed any payments I don’t think the short refi would have been an option as we would not have been able to secure a new mortgage through another bank.
The reason I am writing this is because I want to get the word out that the short refinance option is available. A short sale is not the only option.
For those of you who don’t have the confidence to do this on your own, I suggest that you find a Mortgage Broker you can trust to help with the negotiations. If I could do it - you can do it.
Jennifer Monastero
Wonderful post Ginny- thank you for coming back and sharing. You should read my initial post on loan modification as well- you’d probably get a kick out of it.
Does the town/city consider this a ’sale’? I am wondering if this will still affect house values or not.
beachdude
Loan modification mortgage is a process whereby a home owner’s mortgage is modified and both the lender and homeowner are bound by the new terms of the new mortgage. The most common loan modifications are listed below:
lowering the mortgage interest rate
reducing the mortgage principal balance
fixing adjustable interest rates within the mortgage
increasing the loan term throughout the mortgage
forgiveness of payment defaults and fees
or any combination of the above
Check out this Public site at http://LOANMODIFICATIONMORTGAGE.ORG
Cynthia
Hi Jennifer I think I commented on your earlier entry on loan modification I work in a office that does loan modifications I dont do them but see what goes on all day everyday and I wanted to share a couple things I have seen that leave me shaking my head The first one is the company charges a small upfront fee if the loan is not in default and the remainder when there is a sucessful signed modification They have no problem getting the upfront fee of $950 but the remainder they hardly ever get from the client it is $2950 they are fighting for these people and let me tell you it is a like a street fight they almost always dont have to make a payment for 30 to 45 days on the new modification but they dont bring in the money when they sign and there isnt anything the company can really do about it except go to small claims court which ends making something you feel good about doing for someone into something ugly. I have seen a majority of the modifications the payment decreases between 600 to 1000 per month and that is what a modification should be all about what can the homeowner comfortably afford to stay in the home that is where the second thing comes I have seen some of these clients pissed off because they did not recieve a principal reduction 2 of them the payment went down $1000.00 per month that is $12,000.00 a year one of them signed but was still pissed the other didnt sign and would rather walk away. So I just wanted to let you know they think your great while you are fighting for them but some of them will forget they ever met you once they have a modification especially if they owe money. If you have any ideas on how that can be avoided let me know this office is in California. Thank You, Cindie
Jim
People in trouble with their mortgages should find free professional consultation. Mortgage modifications can often only be done once or have limitations on use. A successful modification with the best possible outcome requires careful preparation. A homeowner must show a viable case for modification to be considered. They must have detailed information on debt to income ratio and budget planning. Free information is at http://www.wemodifyyourmotgage.com . Find out what it takes to qualify before you approach your bank. Carefully prepare you documents for submission to the bank. You are preparing to take advantage of a clause in the mortgage contract.