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Bank of America – Fannie Modification

Posted in Mortgage Modification

HMH came to me following a financial hardship. He faced high payments on his Bank of America serviced loan, with a rate of 5.625. The investor is Fannie Mae. HMH is self-employed as a taxi driver. He also owns a rental house in Brooklyn, which breaks even or makes a small profit. He also owns a taxi in Brooklyn,  and it has a mortgage against it. The rent on the taxi is roughly the amount of the mortgage payments. These self-employed situations are always a challenge. The result was satisfactory. HMH got a 2.0% rate with a 40-year amortization. There was no principal reduction first because Fannie Mae does not give principal reductions (although it sometimes gives principal forbearance) and second because his house is worth approximately what he owes on it.   See HMH’s modification here. The client...

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Zombie Titles

Posted in Foreclosure, Mortgage Modification

The latest foreclosure horror: the zombie title By Michelle Conlin  Thanks to Reuters. COLUMBUS, Ohio | Thu Jan 10, 2013 1:58pm EST (Reuters) – Joseph Keller doesn’t expect he’ll live to see the end of 2013. He blames the house at 190 Avondale Avenue. Five years ago, Keller, 10 months behind on his mortgage payments, received notice of a foreclosure judgment from JP Morgan Chase. In a few weeks, the bank said, his three-story house with gray vinyl siding in Columbus, Ohio, would be put up for auction at a sheriff’s sale. The 58-year-old former social worker and his wife, Jennifer, packed up their home of 13 years and moved in with their daughter. Joseph thought he would never have anything to do with the house again. And for about a year, he didn’t. Then it started to stalk...

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Consumer Financial Protection Bureau Guidelines

Posted in Mortgage Modification

U.S. Consumer Watchdog to Issue Mortgage Rules By EDWARD WYATT Thanks to New York Times Published: January 10, 2013 WASHINGTON — Banks and other lenders will be prohibited from making home loans that offer deceptive teaser rates or require no documentation from borrowers, and will be required to take more steps to ensure that borrowers can repay, under new consumer protections to be announced on Thursday. Enlarge This Image Brendan Hoffman for The New York Times Richard Cordray is the director of the Consumer Financial Protection Bureau. The rules, being laid out by the Consumer Financial Protection Bureau and taking effect next January, will also set some limits on interest-only packages or negative-amortization loans, where the balance due grows over time. Banks can make such loans, but the new rules would not protect them from potential borrower lawsuits if...

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Aurora, Bank of America, Citibank, Chase, MetLife, PNC, Sovereign, SunTrust, U.S. Bank, Wells Fargo –

Posted in Mortgage Modification

Independent Foreclosure Review to Provide $3.3 Billion in Payments, $5.2 Billion in Mortgage Assistance WASHINGTON–Ten mortgage servicing companies subject to enforcement actions for deficient practices in mortgage loan servicing and foreclosure processing have reached an agreement in principle with the Office of the Comptroller of the Currency (OCC) and the Federal Reserve Board to pay more than $8.5 billion in cash payments and other assistance to help borrowers. The sum includes $3.3 billion in direct payments to eligible borrowers and $5.2 billion in other assistance, such as loan modifications and forgiveness of deficiency judgments.  The payments involve mortgage servicers operating under enforcement actions issued in April 2011 by the OCC, the Federal Reserve, and the Office of Thrift Supervision.  The agreement ensures that more than 3.8 million borrowers whose homes were in foreclosure in 2009 and 2010 with the participating servicers will receive...

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Calibur – Formerly Vericrest

Posted in Mortgage Modification

I have only modified one Vericrest loan, and that one was non-owner occupied and way underwater and with a sky high minimum variable rate. And so Vericrest agreed to a reasonable modification. Vericrest has changed its name to Calibur, perhaps to escape its bad reputation for being difficult to work with. Vericrest – Caliber is the worst servicer I know of to work with. Since then I have had the good or ill fortune to work on two more Caliber loans. One failed to go through because the borrower failed to tell me that he had already had three modifications from Caliber. Another Caliber modification is still pending. I continue to receive emails about people who say they have been screwed over by Vericrest/Caliber. To read more click on this link, and make your comments over there: http://jamesrobertdealattorney.com/lenders/vericrest-financial/ This is...

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Debt Forgiviness Will Be Imputed Income Unless Congress Acts

Posted in Mortgage Modification

Beware of IRS Tax Whammy With Short Sales and Mortgage Modifications in 2013 Posted on Wednesday (December 26, 2012) at 6:00 pm to Mortgages & Sub-Prime Mortgage Meltdown Thanks to Long Island Bankruptcy Blog Written by Craig D. Robins, Esq. When a mortgage company agrees to accepts a lesser amount than what is due on the mortgage, then the amount of savings can be taxed as if it were ordinary income.  This is the concept of “imputed income.” If a mortgagee forgives some or all of the balance owed on a mortgage, then the forgiven mortgage debt is taxable. Thus, if a lender agrees to accept a payout of $100,000 on a mortgage, even though $150,000 may be owed, that $50,000 forgiven amount could be taxable as if it were regular income that the homeowner earned. However, in 2007, Congress passed...

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Obama to Replace DeMarco – Stingy Leader of Fannie and Freddie

Posted in Mortgage Modification

BYE-BYE DEMARCO! Obama to Replace Director of FHFA 3 You know, I was having kind of a crummy day… nothing serious, just dragging my feet a bit and grinding through some writing I’ve been working on for too long… and thinking about how nothing is changing… and then out of the blue it happened… and I started smiling right away… kicking my heels up a bit… even opened a cold beer to celebrate the news.   Nick Timiraos, at the Wall Street Journal, is reporting that the Obama Administration is replacing Edward DeMarco, the current “acting” director of the Federal Housing Finance Agency, the conservator for the failed mortgage behemoths Fannie Mae and Freddie Mac.   This past year, Ed single-handedly transformed his otherwise obscure position lurking in the bureaucratic shadows of an agency born less than five years...

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California Puts Attorneys Out of the Modification Practice

Posted in Mortgage Modification

California State Bar RECENT Decision to Cause More Harm to Homeowners in Foreclosure Thanks to Martin Andelman   It’s hard to imagine anything gone so totally wrong as the California State Bar’s interpretation and subsequent handling of SB 94, a law passed in 2009 to prohibit the taking of advance fees in conjunction with providing loan modification services by both lawyers and Department of Real Estate licensees. A few weeks ago the state bar’s Review Board, which functions as the appeals court of the bar’s trial court, published a ruling that effectively prohibits lawyers representing homeowners in the hopes of getting their loan modified from accepting fees AFTER work has been completed.  The new ruling will essentially eliminate a homeowner’s ability to consult with an attorney having anything to do with a loan modification, as it will prevent that...

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Stratigic Default

Posted in Mortgage Modification

Giving Up and Getting Out Foreclosures are no longer a last resort, and a growing percentage of americans think it’s ok to strategically default LISA IANNUCCI Years ago, homeowners viewed foreclosure as a last resort – after all other means had been exhausted to save the home. Homeowners were often embarrassed that they had to take this route. Today, times have changed and, according to a recent study, homeowners find it more socially acceptable to hand over the keys and walk away from their debt. A recent study, by ID Analytics (a consumer identity insight group) and research firm JZ Analytics, shows that 32 percent of U.S. adults say that homeowners should be able to strategically default on their mortgages without any consequences. The report also said that 13 percent would do so if they needed. Rick Sharge, executive...

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Jumbo Modification

Posted in Lenders, Mortgage Modification

A residential property where the first loan was more than around $729,000 at the time of the default is not eligible for modification under the Making Home Affordable program. However, home owners with jumbo-size loans should not despair – especially if their home is under water. Many lenders will modify. Consider this modification in which the owners owed $1.078 million. They received a Making Home Affordable like modification in which their rate was reduced to 2.0% for five years, then 3.0% for one more year, with a probable permanent rate thereafter of under 4.0%. The amortization was 40 years. And they received a principal reduction of $316,000! The servicer is Ocwen, and the trial payment program is here. The final modification is here. The key to the modification is this: The property is now worth only around $700,000. The...

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What Caused the 2007 Crash

Posted in Mortgage Modification

The Trillion Dollar Mistake That Triggered the Economic Meltdown Thanks to Martin Andelman It was summer, 2006, and Fed Chair Alan Greenspan had just raised interest rates for the 17th consecutive time in an effort to cool off the over-heated U.S. housing market.   And it was working.   By the third quarter of 2006, defaulting loans became the first foreclosures of today’s full blown crisis, and as 2007 began, defaults were occurring at the fastest rate in a decade.  Finally, as the summer of 2007 was approaching, even though the prices of some bonds backed by sub-prime loans had dropped, their ratings reflected no change.     London… July 10, 2007 It was July 2007… the 10th to be specific, and Moody’s and Standard & Poors (“S&P”) were each slated to hold press conferences that day.   S&P...

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Strategic Defaulters – To Jail With You

Posted in Mortgage Modification

FHFA Looking to Jail Strategic Defaulters by my friend Martin Andelman   The Federal Housing Finance Administration (“FHFA”), which is the agency created to oversee Fannie Mae and Freddie Mac… the one run by perhaps the least popular man in America for his refusal to allow Freddie or Fannie to grant principal reductions… Ed “It’s a Matter of Principal” De Marco… is back in the news.   Nothing to do with principal reductions on GSE loans (those owned by Fannie or Freddie), this time it’s even more offensive, if you can imagine that.   A reader brought the story to my attention (Hat tip to Deontos) and if it hadn’t appeared in the Chicago Tribune, I’m not sure I would have believed it.   Apparently, the Feds have announced that they are coming after “strategic defaulters,” who they define...

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