As if there wasn’t enough on their plate, Bank of America and other large banks are extending their reach in the loan market by taking on the loans of other lenders. It troubles me that some of these bigger banks are taking on even more responsibilities since they are already under fire for a number of questionable foreclosure practices.

Here’s an example:  I was doing a loan modification for a client whose loan was with Taylor, Bean and Whitaker. Although off to a rough start in initially getting paperwork to them, things were going rather smoothly overall. A few months later, I was on the verge of getting a response for my client. That response never came. In fact, a Taylor, Bean and Whitaker representative informed me that the loan had been purchased by Bank of America and they no longer had information on the loan.

Weeks later, my client’s loan documents …

Underwater on your mortgage?

Earlier this month, the Federal Housing Administration began a new refinance program to help homeowners who owe more on their homes then they are currently worth. Unlike other programs, this program is only for homeowners who are current on their mortgage and who can meet other strict specifications for program inclusion.

The government-backed program, known as FHA Short Refinance, is like a refinance and modification rolled into one. According to the U.S. Department of Housing and Urban Development (HUD), the FHA Short Refinance option is designed to “encourage principal write-downs for [the] responsible borrower.” One catch, each lender’s inclusion in the FHA program is voluntary, and there is a chance your lender(s) may not be participating.

Basic Program Specifications

Requires the consent of all lien holders and existing first lien holder must agree to write off at least 10% of their unpaid principal balance.
Current …

A loan modification can save your home.

Are you in loan modification darkness? It still takes awhile to get a permanent loan modification, but that darkness should be clearing some, as on June 1 the new Home Affordable Modification Program (HAMP) guidelines came into play. But before the final mortgage modification, new HAMP guidelines state that there must be a required 3-month, trial-period modification.

Once you’ve submitted the required HAMP documents and been approved for a loan modification, the lender must mail (usually by FedEx), the trial-period paperwork for your signature, which you will then return by overnight courier to the lender (a postage-paid envelope is included). This paperwork will spell out the trial-period payment amount, dates due and other specifics of the trial modification. Make a copy for your files before mailing back, as you probably won’t get a fully signed copy from the lender.

Track the package to …