Loan Modification We Finally Were Approved

I am not a member of the Tea Party, but increasingly I understand the anger that fuels it. Who is representing the interest of the average American? When we Americans were aghast at the federal rescue of banks, that astonishment was diminished only by the establishment of the loan modification program That meant, we thought, that because so many of us through no fault of our own found ourselves with homes that were underwater we would get help. We owe

 more than the home is worth. While some people walked away from underwater mortgages others liker us wanted to avoid foreclosure, to continue to stay in our homes and pay our mortgages. The banks would help us we were told with a national loan modification program.

We needed help. Our situation mirrors that of many other homeowners I am sure. We are retired and have had to work part-time to “get by”. We applied for a loan modification. The first step was to apply over the phone. We were told we didn’t qualify. We asked why. The bank representative told us perhaps our chances would increase if we simply didn’t pay the mortgage for a couple of months. So we missed two payments. The timing was perfect it turned out. Both my husband and I were laid up with medical problems for three months. This left us behind on all our bills, and dependent only on Social Security. We had exhausted our savings; our medical bills were significant.

We applied again. This is when the marathon started. Starting in March we filled out and sent forms, copies of requested documents. Just complying with the requests was a full time job.

But here is the catch, and here is where our story mirrors that of hundreds of thousands of applicants. It was a bureaucratic nightmare! We would be told all information was up to date and then we would call to find there was additional information needed. And this is the part where the disillusionment really set in. We never knew we were missing information until we called our bank. Then they would tell us they needed more information. And just how do you explain beyond the confines of forms that our income is not steady. Our part time work depends on whether work is available and in one case if a medical condition caused us to temporarily be unemployed. How do you explain the income statements you submit that your monthly income is not consistent month to month. I cut back from teaching four college classes a night to two. Health-wise that is what I can maintain.

This saga has gone on since March. A week ago I called and was told our request “was in the last stages of review”. Two days later I called and was told that it was on hold and two more documents were required. My husband started a handy man business seven months ago. For four of those months he couldn’t work because of a health problem. However, we needed a profit and loss statement and, oh yes, by the way, the latest copies of his checking account (non-business account). This is after we have sent copies of his checking account since March.

So finally the light dawns! The banks don’t want to modify loans. They say they do,

People get discouraged. They think they are waiting for notification when the loan has been shelved. What makes this even worse is that supposedly we were notified of additional information needed. Supposedly a letter was sent out on September 21^st; it was one of several letters supposedly sent to us that we never received. Harriet Miller supposedly called us on September 22^nd and told us we needed more information. That call was never made.

Recently, a great deal has been made of employees of banks never reading foreclosure notices. Perhaps a greater scandal is banks that simply sit on loan applications leaving borrowers to naively watch the mailbox waiting for word that the their loan has been modified. We read in the newspapers that the banks have given few loan modifications. Guess why?

We will continue to try to hold up our end of the bargain and pay every month without the needed help from the bank. We live in Deltona, Florida that has one of the highest foreclosure rates in the country. Does our bank really want to add the home to its stable of foreclosures, a home we love dearly and are fighting to keep?     And you wonder why Americans are mad?

I must enter a postscript since I wrote this several weeks ago. Finally, we received word that we had been approved for a traditional modification. This came after we turned down for one under The Affordable Housing Act. Here is something to be aware of when you apply or even if you are rejected the first try. The Affordable Housing takes into account your gross income including Social Security. If your mortgage payment is a third of your gross you won’t qualify. On the other hand, the traditional takes into account your hardship circumstances. It is also based on your net income, meaning that your expenses are taken into account. Hang in there! I still believe the banks are hesitant to lend but if one course of action doesn’t work, try another. Also, I complained with well written letters to so many people including the top officials of the bank that I was transferred to The Executive Complaint Committee. I was assigned one bank officer to work with me which did take away some of the frustration. She was the one who when we were rejected the first time, re-filed the application for the traditional mortgage. Also, as much of a pain as it was, when our circumstances became worse I asked to make changes to the original application. I think it paid off. Good Luck~