Mortgage Loan Modification - Phony Counselling Scam

Phony Counseling:

This scam has several variations. In all of them the con artist takes your money and doesn't perform any meaningful service. Here is how it works.

1. The con artist requires that you pay him an up-front fee (usually $1500 to $3000).
2. He then "advises" you not to contact your lender, credit counselor, housing counselor or attorney.
3. Sometimes, he then requests that you make your mortgage payments to him while he "negotiates"
4. At some point, he disappears with your money.

Mortgage Loan Modification - Red Flags To Watch Out For

If you have received a foreclosure notice or are having problems paying your mortgage contact your lender and / or attorney immediately. There are many con artists who prey on customers facing foreclosure. Avoid any person / company that does any of the following:

* guarantees to stop the foreclosure process – no matter what your circumstances
* instructs you not to contact your lender, lawyer, or credit or housing counselor
* collects a fee before providing you with any services
* accepts payment only by cashier’s check or wire transfer
* encourages you to lease your home so you can buy it back over time
* tells you to make your mortgage payments directly to it, rather than your lender
* tells you to transfer your property deed or title to it
* offers to buy your house for cash at a fixed price that is not set by the housing market at the time of sale
* offers to fill out paperwork for you
* pressures you to sign paperwork you haven’t had a chance to read thoroughly or that you don’t understand.

Another View About Mortgage Loan Modification

Bill Schmick, writing on www.iberkshires.com makes an interesting argument that mortgage loan modifications may be doing little more than postponing inevitable foreclosures and exacerbating the mortgage crisis. He sees the real problem being lenders' refusal to agree to principal reductions.

Plans whereby lenders reduce payment amounts for a period of time or tack missed payments onto the end of the loan may not be helpful because the borrowers have a reduced amount of time to pay back the loan after the reduced payment period has lapsed. Also, everyone involved, is betting that housing prices will rebound to a higher price than the borrower originally paid for the house.

Half of the modified loans eventually go back into default.

Finally, the National Association for the Self-Employed (NASE) estimates that 1,279,800 small-business owners have missed one to three mortgage payments by mid-November of last year. That was before a wave of resets on their mortgages was about to begin in the fourth quarter of 2008. At the same time, the economy has taken a nosedive that has really walloped the small-business owner.

When a small business fails, it affects not only the business owner but the 5-20 employees who lose their jobs. Since small business is the engine that powers our economic growth, a crisis in that part of the economy could greatly eclipse the damage caused by the subprime crisis.

Mortgage Loan Modification - Here is why it is so hard to modify a mortgage

President Obama, congressional leaders and various regulators, lenders and community groups are proposing more aggressive measures to try to stop the rising pace of home foreclosures.


No matter what measures are enacted, these programs will likely encounter the same financial and legal hurdles that have slowed public and private foreclosure preventions for the past year.


Here are some of the roadblocks lenders and homeowners have faced as they try to work out more affordable loans that will slow the foreclosure rate and keep more people in their homes:

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Mortgage Loan Modification For Chase, Washington Mutual, and EMC Customers

Chase announced on January 17, that they plan to modify $1.1 Trillion dollars worth of mortgages which are currently tied up in mortgage backed securities or investor owned loans. They estimate that the modifications may stop up to $70 Billion in mortgages and 400,000 homes from going into foreclosure.

Chase will also offer the same programs for WAMU and EMC customers. Chase owns EMC, the former mortgage arm of Bear Sterns and purchased Washington Mutual (WAMU) in December 2008.

Here are some numbers to call for help:

Chase (800) 548-7912
Loss Mitigation (877) 838-1882 ext 52195.
The Number you will be directed to after you give your loan number: (866) 665-7629 (business hours are 11AM-8PM M-TH, 8AM-12PM F)
Chase Home Finance (800) 848-9136 (customer service) (858) 605-2181 (delinquency customer service)
Chase Home Finance-New Jersey(800) 446-8939*Chevy Chase Bank(800) 933-9100*
Web: https://chaseonline.chase.com/chaseonline/logon/sso_logon.jsp?fromLoc=ALL&LOB=COLLogon
For SUBPRIME ONLY (877) 838-1882 ext 52195. The Number you will be directed to after you give your loan number: (866) 665-7629 (business hours are 11AM-8PM M-TH, 8AM-12PM F)
Subprime Letter of Authorizations Fax: 1-877-287-7559.
Subprime Workout Packages Fax: 1-888-219-7813.
For Prime Loans: 1800-446-8939
Prime Letter of Authorization & w/o packages Fax: 614-422-7259
Chase Home Finance (800) 848-9136 (customer service)
(858) 605-2181 (delinquency customer service)
Chase Home Finance-New Jersey(800) 446-8939*
Chase Manhattan Mortgage
(800) 446-8939 (Ohio Servicing Center)
(800) 526-0072 (Florida Servicing Center)
(800) 527-3040 x533 (Florida Servicing Center)
Chevy Chase Bank (800) 933-9100
Web: https://www.chevychasebank.com/htm/payment.html

Mortgage Loan Modification - Fixes for Common Credit Problems

Homeowners with financial trouble wanting to refinance their mortgages to better rates may be pleased to know there are still options out there for them. There are strategies available to help overcome challenges such as inadequate income, excessive debt, negative equity or poor credit.

Inadequate income and excessive debt are two sides to the same coin. Lenders consider a borrower's Debt to Income (DTI) ratio.to make sure that a borrower can pay back the loan. If you've suffered a loss of income, overstated your income on your original loan application, are self-employed or have taken on additional debts, you're most likely to be among the many homeowners who face this type of problem. You can change this ratio by earning more money with a second job, or, by paying down other debts such as credit card or other consumer debts. When you are in the process of getting or refinancing a loan, do not borrow more money as this can damage your DTI ratio. Lenders normally look for a DTI ratio no greater than 38%.

Negative equity means that you owe more on your house than it is worth. Lenders consider your loan to value ratio (LTV). Most lenders require an 80% LTV. You can try to lower the amount of your loan through a lump-sum payment, or by gradually making extra principal payments.

You can use funds from a savings or retirement account, sale of another asset, income tax refund or bonus to make your lump sum payment. You can also achieve a gradual reduction in principal by making bi-weekly payments or by making extra payments to principal. If you are going to make extra principal payments, you must indicate that the payment is to be applied to principal by writing that instruction on your check. Most mortgage agreements provide that unless you specify that a payment is for principal, it will be first applied to interest.

If your mortgage is insured by the Federal Housing Administration, or FHA, you might be able to qualify for a so-called "streamlined" refinance that doesn't require an appraisal. Mortgage insurance, which protects the lender from loss if you default on your loan, also may be a way to overcome insufficient equity.

If you have a second loan and the lender refuses to subordinate, you might want to combine both of your loans into one new loan. If you obtained your second loan through the same lender as your first and as part of your purchase-money financing, you may be in a better position to combine the two loans than if you obtained your second loan later on. In that case, you'll be subject to more strict guidelines because your refinance will be considered a cash-out, rather than a conventional rate-and-term refinance.

Mortgage Loan Modification -Is now the Best Time To Refinance?

Mortgage rates are now at a 51 year low. The treasury department plans to make more money available for mortgage loans. This video shows why you might want to consider refinancing now.