Why are homeowners being lied to pretending there is a loan modification?

Question

So far I have not met a single individual who has been successful in modifying the terms of their loan. The most the lender offers (I have contacted Citi, Countrywide, Wamu) is deferring payment from 2 to 6 months depending on your application, and then you have to repay that amount on top of your originaly monthly payment after the deferrment period is up at a higher interest rate for the deferred amount. The 5 loan modification companies I contacted wanted an upfront fee, such as $3,500 they were so kind to say I could charge on my credit card, while making it crystal clear there were no promises they could get my loan modified but for sure they will help me with a short sale which is where they make most of their money. They also couldn't give me any referrals to anyone whose loan they had modified. An attorney and 3 of the loan mod companies advised me to start missing my payments so I wouldn't delay the short sale process that nobody really gets modifications.

So...while Obama is giving handouts to the bankers who are screwing us over, we have to foot their handout while suffering. I take it the modification hoopla is just smoke and mirror to conceal how screwed over we are getting and to prevent massive numbers of immediate heart attacks, just prolong the process of people losing their homes.

Answer 1

I'm with you. There's nothing that we can do in the current environment. I can't refi, modifi or foreclosurerfi. Obama is helping no one.

Answer 2

I do know many people who have modified their loans but they are the ones who did this as soon as they ran into trouble. No one is going to just dismiss the amount you owe. If you can defer some payments to the back of the loan, then that will at least give you 6 months to get things under control. That is preferable to losing your house.



Companies who will stop foreclosure are not going to do it for free. Paying $3,500 is better than paying $12,000 in arrears for some people. You need to be careful of the scams though. They also can't guarantee a modification because it depends on your payment history and credit rating. If you haven't paid anyone or if you have years of slow paying, you won't get one.



I don't believe that a lawyer told you that no one gets loan modifications. That just isn't true. It happens all the time but again, these are people who are basically good payers but have run into a short term rough spot and can start up again if they just get some help. They had good credit before a layoff or illness.



Edit: You just spoke volumes in your additional details. You have a cable bill. Obviously your house is not a priority or you would have gotten rid of all bills that weren't absolutely necessary. That could be why you can't get a modification.

Answer 3

rather obviously, it is in the best interest of the owners of the loan to make the minimum modification that will enable you to make the rest of the payments.



it isn't as if they were giving away free houses and you got one. They weren't and you didn't.



so what happens, if and when it happens, is the minimum needed to keep you paying.



If you're temporarily out of work, what's needed is for a few payments to be moved from now to at the end of the loan. That's it, and yes, there is a fee for doing this which is added onto those payments.



If some other life changing event has occurred, then the loan modification needed may be different.



However, there will NOT be a modification such that the lender thinks it would get more by foreclosing and taking the loss. So if you've gotten divorced and your ex- disappeared and ins't making the court ordered payments -- they just foreclose.



And if you've become permanently disabled and can't work at all -- you need to downsize your housing bills which they'll help you do by foreclosing.



oh

Answer 4

obama yo mamma is giving banks money to replace the money you borrowed to buy a house but refuse to pay for.... here is the scam you are running....you make a mortgage payment instead of a more expensive rent payment .....then you make a few less expensive mortgage (really rent ) payments....then you stop making any payment what so ever for a year until you finally move out....now you find it a little difficult to get a loan for the same exact house for half the price and you whine about it

Answer 5

I have had two people in my shop have their loans modified (because of their security clearances they are required to report any personal financial issues to me). Each of them was able to get their interest rates cut to a much lower fixed rate.



Each person's financial situation is different. Just because _you_ are not getting attractive refinancing offers does not mean that nobody else is.

Answer 6

uh...for starters the "modification companies" are rip off artists. Anyone who doesn't know that is asking to get taken.



Nothing happens overnight in the mortgage business; especially in the middle of a re-fi boom.

Answer 7

Obama spoke, you voted. Obama lied. Now what?