Write Your Own Loan Modification Terms
There may be some good news for besieged homeowner trying to avoid foreclosure. For many homeowners, getting ground up in the gears of the big mortgage servicing machines is not a lot of fun.
Jumping through voice mail hoops, dialing in your account number, “the last four digits of your social security number,” sitting on hold, re-explaining your foreclosure situation to yet another person… it can be very frustrating.
However, some of these homeowners just might get lucky and be picked up by a smaller servicer. This could be good news, or it could be bad news.
Housing Wire reports that some of these “investors” are small-time players with little experience, looking to make a quick buck. All manner of groups are joining the gold rush to purchase distressed mortgage pools at sense on the dollars.
What does that mean for homeowners?
Well, it could mean a couple things.
If you have an investor with little experience in modifying loans or other loan workout options, you could find this more difficult than working with the monster mortgage servicers.
If you wind up with an investor that’s bought at a steep discount and is hell-bent on foreclosing on any homeowner that doesn’t do a full reinstatement, you’ll wish loan hadn’t been sold.
If you wind up with a servicer who has experience and is truly willing to work with homeowners, then you might get yourself some decent loan workout terms, and stop foreclosure after all.
The fourth possibility is most interesting: you get a mortgage servicer that’s inexperienced, but willing to work with you. If you get the right guidance, you may just be able to write your own loan modification terms.
I have found that even at the largest servicers, when I discuss options that the negotiator didn’t evern realize we had, I can often get some really sweet terms written into the loan modification.
There have been four cases I’ve worked on in the last 60 days where the loss mitigation rep insisted that the loan could not be modified.
I not only showed them what could be done, I showed them how, whom to call, what to say and how to ask for authorization to get the deal done.
There is no doubt in my mind that these homes would have gone to foreclosure without my involvement, as not one of these homeowners had the financial abiility to meet the terms that the loss mitigation department wanted to offer.
It’s unclear to me whether this was just laziness on the part of the foreclosure department staff, or if they truly did not know that we had as many loss mitigation options as we did.
At the end of the day, it doesn’t really matter. What does matter is that we were able to stop foreclosure, and get a solid loan modification on all four of those loans, with terms that give those homeowners the best possible chance to stay out of foreclosure.
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