My H.A.S.P. Mortgage Workout Request

[2Bshinyandnew]

I figured I would document my mortgage workout request under Obama's Homeowner Affordability and Stability Program here. If anyone has any ideas, please feel free to comment!

I am in year 6 of my fixed rate 30 year Fannie Mae mortgage. I do not have any HELOCS or any other loans against this property. The original LTV was 60% in 2003 and today it is about the same, perhaps less, maybe 50% My home probably appraises for about $30K less today then it did in 2003, and in the last 6 years I have paid off about $12K in principal. I still have some reasonable equity, although that gets lower every day it seems. , and I have not done an appraisal.

I have not (yet) filed for bankruptcy although bankruptcy is definitely in my future. My exhub has filed a CH7 and discharged all our joint debt, including our mortgage. This may cause me some trouble as far as needing his signature for any workout, but that is another issue.

I have never missed a payment/never been late.

Due to divorce, my household income has dropped substantially. My income is 65% less now than it was in 2003. At this time, my mortgage payment takes up over 65% of my gross income.

I was previously told by my mortgage servicer that since I was not in default on my mortgage I would not be eligible for any type of modification/workout. Despite being told this, In late January 09, (pre-details of the Homeowner Affordability and Stability Program) I wrote a hardship letter and sent in an application for a workout to my mortgage servicer, Mortgage Service Center. I was pretty happy when the HASP details were released, and I realized my application may not be automatically rejected because I wasn't late.

I attached all the documents requested on the application. Included in my letter was the amount and source of my unearned income and a statement that I do not have a job and have no earned income. This was sent out late January 09. In the letter I requested a temporary interest-only only payment and possible forbearance so that I could stay in my home at least until my autistic son finished the special program he was in.

In mid February I received a letter from Mortgage Service Center stating they had received the request for a mortgage workout and to please send copies of payroll stubs I was pretty happy though because that meant that I wasn't denied!

I immediately called and was able to get through to someone in loss mitigation who advised me to send a copy of my bank statements, proof of the source of my unearned income and a copy of any divorce documents. I did so immediately, even though I had already sent all this with my original application and hardship letter. (where did my info go? scary!!)This was sent to them via USPS (I don't have a fax) in mid February.

As of today, I have called and left messages and I am waiting to hear back on the status of my workout options. I'm told I am in stage 2, and once they receive the documents I keep trying to send them (and they twice now have not received), my loan workout will go to stage 3, where my request will be forwarded to the investor.

When I called today (again) and was told my documents had still not been received, I asked for an e-mail address of the representative assigned to my case whose voice mailbox is now full and has not returned answered the message I was able to leave in her mailbox on Monday.

I sent an email this morning to the address I was given with a very nice letter, and attached everything they asked for and then some.

So, I guess I will wait another 2 days.

From what I understand, once I get to stage 3 and I am working directly with a representative of the investor, all the possible options outlined in Obama's HASP will (hopefully) be looked at.

The details of HASP can be found here:

http://www.treas.gov/press/releases/reports/modification_program_guidelines.pdf

The Department of Treasury is here:

http://www.treas.gov/initiatives/eesa/

I am praying something can be worked out so I can keep my house. My son has autism and goes to a special program close to home. There are currently 16 homes in my development for sale, so trying to sell is an absolute last resort, and unless I give the property away, it could sit for awhile. When I run the numbers, it appears it would definitely be profitable for the investor to do some sort of workout; there is still money to be made for them on my loan, even with the maximum possible modifications (see above PDF)

If the details of Obama's HASP are accurate, I could work something out by lowering the interest rate (2% is the bottom), increasing the term to 40 years, and forbearing some principal (without interest! - see the above link to the program guideline)

I'll keep y'all posted!

[2Bshinyandnew]

Update:

I know I am being impatient, BUT, I seem to be having a difficult time getting the requested info (divorce docs, monthly child support amount received) to the person handling my submitted workout request. I have sent this info 4 times at this point;
~ 1/27/09 with my original hardship letter;
~ 2/23/09 by USPS in response to a letter from the mortgage servicer saying they recieved my workout request and asking for pay stubs that I had already stated in writing I don't have (and they admit to receiving);
~ 3/11/09 after calling and speaking to 3 different reps I was advised to send an e-mail to the loss mitigation rep and attach all docs. I did so;
~ 3/12/09 I went to Kinkos and faxed everything again.

I called today and the rep I spoke to still doesn't "see" that the requested docs have been recieved and until they are, nothing can be done, my application is on "hold" . The rep I spoke with this morning told me she would e-mail the loss mitigation specialist I was assigned to and request that I be called back and what I can do to get the documents (that they should already have) into the hands of the right person.

I am so frustrated. Then I did a little searching on the internet and found this page,

http://www.afscanhelp.com/companies/mortgage-companies/phh-mortgage-services.cfm

with a whole bunch of folks with the mortgage servicer I have complaining about the same problems I seem to be having. I'm wondering if I should consult an attorney about getting this moving. I meet all the criteria for a modification under Obama's Making Homes Affordable http://www.treas.gov/initiatives/eesa/.

What type of attorney would handle this and what info do I need to have? If I could get things moving by a couple of months the $$$ I could save in a modified payment would more than make up for paying an attorney $1-$2K.

Any ideas?

Oh, and I found this about my mortgage servicer as well:

http://themortgageinsider.net/mortgage-servicing/phh-mortgage-services-review/

"PHH Mortgage Services Review

PHH Mortgage Services even though they lend themselves, most likely they are a sub-servicer for the lender you owe. Subservicers are notoriously bad with customer service and it shows with PHH in the shear number of complaints we found. "

[Flowers]

2B:
I experienced the same thing today with Chase. I called to check on the status on my loan modification which I began with them in November. My filing BK put the LM on hold, and now that I am discharged they want as do I, to get going on it again. I called today, as I do once a week. I know they are incredibly busy and I figured it would be 60 - 90 days once they had the final information and a document ready for me to sign.

Anyway, I called today and the guy explains something about Obama Housing and that every customer has to know about it.

Same thing: 1. they want another hardship letter 2. tax returns last 2 years 3. bank statements

Just like you: I sent all this stuff several times already. I get the feeling that it all is by the book and they want the most up to date information.

It is frustrating though - I photocopy all the info and send it by mail. Too many pages to fax.

It will be worth it in the end. Just have to keep on top of them. I DO NOT THINK THIS CAN BE HURRIED ALONG. JUST GO WITH THEIR (SILLY) TIMEFRAME. NO NEED TO PAY A LAWYER.
I think there is strict ahereance to the foreclosure process if it goes that way and it does not sound like your case will be.

Thank you for the link to the info by the way.

[2Bshinyandnew]

2B:
I experienced the same thing today with Chase. I called to check on the status on my loan modification which I began with them in November. My filing BK put the LM on hold, and now that I am discharged they want as do I, to get going on it again. I called today, as I do once a week. I know they are incredibly busy and I figured it would be 60 - 90 days once they had the final information and a document ready for me to sign.

Anyway, I called today and the guy explains something about Obama Housing and that every customer has to know about it.

Same thing: 1. they want another hardship letter 2. tax returns last 2 years 3. bank statements

Just like you: I sent all this stuff several times already. I get the feeling that it all is by the book and they want the most up to date information.

It is frustrating though - I photocopy all the info and send it by mail. Too many pages to fax.

It will be worth it in the end. Just have to keep on top of them. I DO NOT THINK THIS CAN BE HURRIED ALONG. JUST GO WITH THEIR (SILLY) TIMEFRAME. NO NEED TO PAY A LAWYER.
I think there is strict ahereance to the foreclosure process if it goes that way and it does not sound like your case will be.

Thank you for the link to the info by the way.

Thanks for the support, Flowers!

On Tuesday I emailed all my info to my sister for her to print out and fax to the two fax #'s I have since my faxes (sent from Kinkos, I don't have a fax) didn't make it through. I called yesterday and YES, they did receive my info

I'm trying to be patient. Just like the rest of us, that next payment coming up and if I could at least get into the "3 month trial" they keep referencing in all the modification guidelines, I could breathe. My last resources have run out. My entire divorce/property settlement was based on my house's value in 2007...

The Fannie Mae website has even more info now:

http://www.fanniemae.com/index.jhtml

and here the financialstability.gov site that was temporarily up is now replaced with:

http://www.makinghomeaffordable.gov/

This borrower FAQ is pretty informative:

http://www.makinghomeaffordable.gov/docs/borrower_qa.pdf

My biggest concern now will be how the bank will look at my ex's income since he was a co-borrower on the original note. The guidelines for the MHA modification state that income from all borrowers, even co-borrowers on the note must be included. In my case, not only has my ex had his responsibility to this mortgage discharged in a CH7, he has no legal interest in the house, doesn't live here and is ordered to pay alimony/support. Our divorce docs clearly state I am responsible for the mortgage, his name was never on the deed, but the only way to get his name off the note is for me to refinance, which so far I do not qualify for. I'm worried they will either not give me a modification unless he signs it, which would reaffirm the mortgage for him (he may do this,, I don't know) OR they will go by HIS income which if they go by his income would knock the PITI payment to below 32%. I sure hope that doesn't happen! I do not qualify for a refi on my own. I just hope they can do the modification based on the actual household income. I'm hoping his BK7 will be enough to have his name removed, since they can't collect from him.

Flowers, Is your loan a Fannie/Freddie?

[Flowers]

My loan is with Chase. I don't think it has anything to do with Freddie or Fannie.
But it is wild how long this has been going on.
My hardship comes 100% from divorce. Somehow I am managing to "benefit" from the poor economy situation and it's relationship tot he mortgage industry.

Perhaps your divorce attorney can be of help? Get him to help you get the lowest possible rate/payment with no responsibility of his. Start you off on your own the best way possible.

[justin37013]

Just a few bits of information regarding HASP loans and what we know so far. I work for a lender and I'll give you the details that we have and hopefully you'll get something useful out of it.

Freddie is the only one to release details on their HASP loan program. Fannie is set to realease early April. This is important because if your loan is currently owned by Fannie there isn't an option for you until next month. If your loan is owned by Freddie your existing servicing company can help you out. You should be able to call your lender and find out.

So assuming your loan is owned by Freddie here is what you need to do. You can only go back through your existing service bank. So if Chase is servicing your mortgage you have to go back through them. If it's with Fannie you will have the choice of going with whatever bank you want, but not until next month when the program is released.

- If you have never been late more than 30 days on your mortgage you are eligible, regardless of income, up to 105% of the value of the home which is determined by an automated report or by using a drive by or full appraisal if the value is low or one cannot be generated.

-You cannot take any additional cash out but you can finance $2500 over your current principle balance to help setup the new escrow account and pay closing costs.

-If you are currently paying PMI you will continue to do so. If you are not paying PMI you will not have PMI on the new loan regardless of whether or not it is more than 80% LTV. So lets say you were at 75% LTV and your home lost value and setting up the new loan puts you at 103% LTV.. you will NOT have PMI on the new loan.

-You cannot pay off a 2nd mortgage, even if it was a purchase money second(used to purchase the home like an 80/20) you will only pay off the 1st. There is however no maximum combined loan to value. You can owe as much as you want on the second and it will not affect the loan as long as the bank that holds the second is willing to subordinate behind the new first mortgage. So for example if you owe 100k on a mortgage and have a 30k second and your home appraises for 99k you can still re-do your mortgage with this program.

... these are the easiest loans we have ever done. The bank takes a loan application and is not required to document income,assets etc.. there is no appraisal required on 90% of the loans as the HVE tool banks are using will generate a value for most properties. On average they have been taking about 2 - 3 weeks to close only because of the amount of volume banks are seeing with this program. Otherwise they would close within 1 - 2 weeks max.

Hopefully this information is useful to someone out there reading. Again, if your loan is not owned by Freddie you have to wait. If your bank made an exception and held the paper and it's not owned by Freddie OR Fannie you probably won't have an option. No word on government loans either so if you have FHA or a VA loan there might not be any options either.

[myhearts07]

Your last statement is my whole problem right now. Do you know why FHA/Va were not included?

Hearts

[2Bshinyandnew]

Just a few bits of information regarding HASP loans and what we know so far. I work for a lender and I'll give you the details that we have and hopefully you'll get something useful out of it.

Freddie is the only one to release details on their HASP loan program. Fannie is set to realease early April. This is important because if your loan is currently owned by Fannie there isn't an option for you until next month. If your loan is owned by Freddie your existing servicing company can help you out. You should be able to call your lender and find out.

So assuming your loan is owned by Freddie here is what you need to do. You can only go back through your existing service bank. So if Chase is servicing your mortgage you have to go back through them. If it's with Fannie you will have the choice of going with whatever bank you want, but not until next month when the program is released.

- If you have never been late more than 30 days on your mortgage you are eligible, regardless of income, up to 105% of the value of the home which is determined by an automated report or by using a drive by or full appraisal if the value is low or one cannot be generated.

-You cannot take any additional cash out but you can finance $2500 over your current principle balance to help setup the new escrow account and pay closing costs.

-If you are currently paying PMI you will continue to do so. If you are not paying PMI you will not have PMI on the new loan regardless of whether or not it is more than 80% LTV. So lets say you were at 75% LTV and your home lost value and setting up the new loan puts you at 103% LTV.. you will NOT have PMI on the new loan.

-You cannot pay off a 2nd mortgage, even if it was a purchase money second(used to purchase the home like an 80/20) you will only pay off the 1st. There is however no maximum combined loan to value. You can owe as much as you want on the second and it will not affect the loan as long as the bank that holds the second is willing to subordinate behind the new first mortgage. So for example if you owe 100k on a mortgage and have a 30k second and your home appraises for 99k you can still re-do your mortgage with this program.

... these are the easiest loans we have ever done. The bank takes a loan application and is not required to document income,assets etc.. there is no appraisal required on 90% of the loans as the HVE tool banks are using will generate a value for most properties. On average they have been taking about 2 - 3 weeks to close only because of the amount of volume banks are seeing with this program. Otherwise they would close within 1 - 2 weeks max.

Hopefully this information is useful to someone out there reading. Again, if your loan is not owned by Freddie you have to wait. If your bank made an exception and held the paper and it's not owned by Freddie OR Fannie you probably won't have an option. No word on government loans either so if you have FHA or a VA loan there might not be any options either.

Thanks for the info, Justin!

My loan is a Fannie, so I guess I won't know anything until April. Hopefully, the process and outcome will be similar to Freddie.

I wonder if you can answer a question regarding income verification?

My ex husband is on the original loan. We are legally separated and our divorce agreement says I get the house and all the associated joys of home-ownership. He signed the quit claim deed with the agreement (although his name was never on the deed anyway) My ex filed for BK CH7 in 2008 and included the mortgage to the house I am still living in, paying on and not late on, yet. He was discharged last month. If it meant that I could get a modification or refi, he would probably sign an agreement, even if it meant reaffirming.

The modification guidelines state that income from all borrowers on the note are required. In a situation like mine where one of the borrowers on the note has had their liability discharged through BK and divorced, etc., will they still count his income? Previous inquiries about refi were NOT successful.

[beachymama]

I am sorry if I missed this, but does this H.A.S.P. work for people who have been served a foreclosure notice (I was served yesterday). My loan is Fannie Mae. IndyMac has turned me down for modifications. I called them tonight and they offered a forebearance plan, i.e. pay your mortgage amount for the next three months while we think about giving you a modification. If I could pay my mortgage payment amount each month, I would not be in default.

Do I respond to the summons? Do I wait for April to come around to get the Fannie Mae H.A.S.P. modification?

I am behind, I live in the home, it is under $700,000 and I have a job/income to pay a mortgage, just not the $2400 (inc tax & insurance). According the the calculator on the H.A.S.P. website, I am paying 45% of my income towards my home and this plan would put me at 31%.

Should I put off bankruptcy? I have been putting it off because I want/need a loan modification if I am going to save my home.

Can you be in bankruptcy with H.A.S.P.?

[justin37013]

Thanks for the info, Justin!

My loan is a Fannie, so I guess I won't know anything until April. Hopefully, the process and outcome will be similar to Freddie.

I wonder if you can answer a question regarding income verification?

My ex husband is on the original loan. We are legally separated and our divorce agreement says I get the house and all the associated joys of home-ownership. He signed the quit claim deed with the agreement (although his name was never on the deed anyway) My ex filed for BK CH7 in 2008 and included the mortgage to the house I am still living in, paying on and not late on, yet. He was discharged last month. If it meant that I could get a modification or refi, he would probably sign an agreement, even if it meant reaffirming.

The modification guidelines state that income from all borrowers on the note are required. In a situation like mine where one of the borrowers on the note has had their liability discharged through BK and divorced, etc., will they still count his income? Previous inquiries about refi were NOT successful.

With the HASP loan program the borrowers have to be the same on the new loan as the old loan unless there is a divorce or death associated. You will have to supply the divorce decree and property settlement agreement to show you have legal right to the property. Your income must be listed on the loan application but debt ratio is not a factor in the Freddie HASP loan. I'm assuming the Fannie program will be the same but we wont know for a couple more weeks. You can even be unemployed and qualify. Even though it states all income is required nothing is verified and you don't supply any income documentation. This is NOT like a subprime loan however because all the company is doing is basically modifying your loan.. no cash out,no debt consolidation and max 105%.

[justin37013]

I am sorry if I missed this, but does this H.A.S.P. work for people who have been served a foreclosure notice (I was served yesterday). My loan is Fannie Mae. IndyMac has turned me down for modifications. I called them tonight and they offered a forebearance plan, i.e. pay your mortgage amount for the next three months while we think about giving you a modification. If I could pay my mortgage payment amount each month, I would not be in default.

Do I respond to the summons? Do I wait for April to come around to get the Fannie Mae H.A.S.P. modification?

I am behind, I live in the home, it is under $700,000 and I have a job/income to pay a mortgage, just not the $2400 (inc tax & insurance). According the the calculator on the H.A.S.P. website, I am paying 45% of my income towards my home and this plan would put me at 31%.

Should I put off bankruptcy? I have been putting it off because I want/need a loan modification if I am going to save my home.

Can you be in bankruptcy with H.A.S.P.?

Probably not. HASP states that no 30 day lates within the last 12 months. It's not a program for people about to lose their home to foreclosure, it's a program designed to allow people who are not in danger but who could not take advantage of low interest rates because of appraisal issues or issues with new strict lending guidelines.

The idea is that if all these people are able to get rates <5% (which are currently available) it puts more money in their prockets which will ultimately increase spending and stimulate the economy. It's a stimulus program, not a bailout.

This is why the criticism by people that we are rewarding people for getting behind on their mortgage is simply not true. This program specifically rewards people who have paid on time but have lost out because the housing market has crashed and killed their home value.

In your case there are other options but you have to work with your bank to see if they will play ball. Unfortunately some banks are not willing to help much

[2Bshinyandnew]

Just a few bits of information regarding HASP loans and what we know so far. I work for a lender and I'll give you the details that we have and hopefully you'll get something useful out of it.

Freddie is the only one to release details on their HASP loan program. Fannie is set to realease early April. This is important because if your loan is currently owned by Fannie there isn't an option for you until next month. If your loan is owned by Freddie your existing servicing company can help you out. You should be able to call your lender and find out.

So assuming your loan is owned by Freddie here is what you need to do. You can only go back through your existing service bank. So if Chase is servicing your mortgage you have to go back through them. If it's with Fannie you will have the choice of going with whatever bank you want, but not until next month when the program is released.

- If you have never been late more than 30 days on your mortgage you are eligible, regardless of income, up to 105% of the value of the home which is determined by an automated report or by using a drive by or full appraisal if the value is low or one cannot be generated.

-You cannot take any additional cash out but you can finance $2500 over your current principle balance to help setup the new escrow account and pay closing costs.

-If you are currently paying PMI you will continue to do so. If you are not paying PMI you will not have PMI on the new loan regardless of whether or not it is more than 80% LTV. So lets say you were at 75% LTV and your home lost value and setting up the new loan puts you at 103% LTV.. you will NOT have PMI on the new loan.

-You cannot pay off a 2nd mortgage, even if it was a purchase money second(used to purchase the home like an 80/20) you will only pay off the 1st. There is however no maximum combined loan to value. You can owe as much as you want on the second and it will not affect the loan as long as the bank that holds the second is willing to subordinate behind the new first mortgage. So for example if you owe 100k on a mortgage and have a 30k second and your home appraises for 99k you can still re-do your mortgage with this program.

... these are the easiest loans we have ever done. The bank takes a loan application and is not required to document income,assets etc.. there is no appraisal required on 90% of the loans as the HVE tool banks are using will generate a value for most properties. On average they have been taking about 2 - 3 weeks to close only because of the amount of volume banks are seeing with this program. Otherwise they would close within 1 - 2 weeks max.

Hopefully this information is useful to someone out there reading. Again, if your loan is not owned by Freddie you have to wait. If your bank made an exception and held the paper and it's not owned by Freddie OR Fannie you probably won't have an option. No word on government loans either so if you have FHA or a VA loan there might not be any options either.

I just re-read this. I think this info is regarding Freddie Refinance, and not modification, correct?

[2Bshinyandnew]

I am sorry if I missed this, but does this H.A.S.P. work for people who have been served a foreclosure notice (I was served yesterday). My loan is Fannie Mae. IndyMac has turned me down for modifications. I called them tonight and they offered a forebearance plan, i.e. pay your mortgage amount for the next three months while we think about giving you a modification. If I could pay my mortgage payment amount each month, I would not be in default.

Do I respond to the summons? Do I wait for April to come around to get the Fannie Mae H.A.S.P. modification?

I am behind, I live in the home, it is under $700,000 and I have a job/income to pay a mortgage, just not the $2400 (inc tax & insurance). According the the calculator on the H.A.S.P. website, I am paying 45% of my income towards my home and this plan would put me at 31%.

Should I put off bankruptcy? I have been putting it off because I want/need a loan modification if I am going to save my home.

Can you be in bankruptcy with H.A.S.P.?

Beachy, If your loan is with Fannie Mae, I would call your mortgage servicer again and ask them if they are participating in the Making Home Affordable Program. You may still be eligible for a modification, I suspect the info posted by Justin was regarding the Making Home Affordable Refinance.

See:

https://www.efanniemae.com/sf/mha/

The modification program says that if you are behind, even in foreclosure, they will work with you. I suspect that as Justin posted, while mortgage servicers have gotten Freddie Mac guidelines and are actively refinancing and/or modifying loans, the servicers have not gotten the Fannie Mae details yet, for either modification or refinance. Hopefully they will by April 1st.

After all the many phone calls and faxes and conversations I have had with my servicer since January, I spoke with someone in loss mitigation on Monday 3/23/09 to ask about the status of my workout request. I was told that my original request was probably going to be denied because I am not in default but hey, guess what!, she she could take my info over the phone and put me on a "list" for a new program coming out soon for people who aren't late as well as people who are in default. Nobody has asked me for any financial info over the phone yet so I was pretty happy about that. I gave her all the info and she said I would receive a packet in the mail in 7-10 days. We'll see.

[beachymama]

After all the many phone calls and faxes and conversations I have had with my servicer since January, I spoke with someone in loss mitigation on Monday 3/23/09 to ask about the status of my workout request. I was told that my original request was probably going to be denied because I am not in default but hey, guess what!, she she could take my info over the phone and put me on a "list" for a new program coming out soon for people who aren't late as well as people who are in default. Nobody has asked me for any financial info over the phone yet so I was pretty happy about that. I gave her all the info and she said I would receive a packet in the mail in 7-10 days. We'll see.

It is nice to see that somebody's servicer is attempting to help their customers!

[beachymama]

Fannie Mae

I was able to read the info on the efanniemae site. I used the fanniemae verifier and my loan is a Fannie Mae loan.

It looks promising for me. I will call IndyMac again and ask for that particular program.

Thank you!