Mortgage Company Loss Mitigation Department Tips

Mortgage Loan Modification How To's - Mortgage Loss Mitigation Made Simple
By Ron Stephens

These are incredibly challenging times for American homeowners. More people than ever before are considering mortgage loan modification as an alternative to the possibility of losing their homes. The need for banks to consider loan modifications for homeowners has come about because of various reasons:

• Adjustable rate mortgages that have adjusted up and increased monthly mortgage payments beyond their ability to pay.



• Some homeowners took out adjustable rate mortgages, expecting to refinance at a better rate later, only to find their home's diminished value won't support a sufficient loan amount to qualify for refinance, and therefore they can not take advantage of new lower rates.



• Many have lost their jobs, some having worked for the same company for many years, and now can't afford their payment.



• Retirement income that would have helped pay off the mortgage, lost in the stock market crash.

If any of these situations describe you, there is hope. Because of the tremendous number of people facing foreclosure, banks are more willing than ever to work with homeowners in several ways. They know that the epidemic proportions of distressed homeowners, has created a bigger challenge than foreclosing the loans of so many people who are in default, can overcome. Here are some possibilities for you if you need answers:

• Short refinance: Your lender may be willing to lower the balance on your home mortgage, create a new loan at the lowered amount, and thus give you a lower payment.



• Short Sale: If you just need to get out of your house, your lender may be willing to let you sell the home to another party, for an amount that is less than what you owe, and forgive you of the difference.



• Loan Modification: Your lender may restructure your loan, add any late payments to the balance, create a new loan amount with new parameters.

Whichever one of these options that your bank may be willing to consider, depends on your personal standing with them, and your financial situation. Here are some things that you must do if you want your bank to consider a mortgage loan modification on your behalf:

• Communicate with them early on...DO NOT avoid talking to them about your hardship.



• Keep a proper perspective...They are not the enemy. You owe them the money, having borrowed it with the promise to pay it back. Don't get angry with them for your difficulty. Respect them, and you have a better chance of them working with you.



• Ask them for help. If the person you talk to is not willing to help you, keep calling and asking for a supervisor until you get someone who will listen and try to help.



• Consider enlisting the help of a professional "loan mitigation service". You may have to pay a small fee, but these people are very good at what they do. They have the know how and the resources, and the credibility that will get your bank's attention and cause them to be more willing to work with you.

The bottom line is: banks are more willing than ever to enter into mortgage loss mitigation with their customers. And if you do enough research, and you are patient and stick to the process of filling out many forms and making many phone calls, and being put on hold for long periods of time, you may be able to get a mortgage loan modification, and save your home and your credit.

If the thought of doing all of that causes you to break out in a cold sweat, and feel like giving up before you even start, than you should consider a loan mitigation specialist. They are available online, in the yellow pages, or you may be able to get a good one referred to you by a realtor or mortgage broker.

For more information about mortgage loan modification, and where you can go for more information to help you work through the process of saving your home and your credit, or to find out how you can enlist the help of some of the most qualified professionals in the loan mitigation business, go to: http://onlinemortgagerepair.com

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Mortgage Loan Modification Request Template

Loan Modification Hardship Letter Template

Author: Matt Sparks

In order to successfully modify a loan for your client (or for yourself), you will need to write a good hardship letter to send to the lender along with the rest of the modification package documentation. Make sure to include the borrower's name(s), the property address, the lender name, and the loan number at the top. In the body, state what kind of modification the borrower would like, the reason they fell behind, and why their situation is stabilized or better now.

Make the letter short and sweet. If the letter is too long, it will begin to sound like a sob story and could get skimmed or even ignored by the overworked people in the lender's loss mitigation department. Also, for an extra personal touch, keep the voice in first person for the borrower (i.e. I, me, and we), and always have them sign it personally. Have them write it by hand on a blank sheet of paper even, as it will seem less likely to have come from you or a template (which it did), and more like it came from the heart.

Below is a sample template you can use with my permission. Just cut and paste the text into a Word document, fill in the blanks, and tailor it to your own borrower's specific situation. You may even want to tweak the verbiage a bit, as the lenders will likely have seen many identical copies of just about every hardship letter you can find online.

--

Date
Client’s name
Property address:
Lender Name
Loan number: 99999999999

To Whom It May Concern:

This letter explains the unfortunate circumstances under which I fell behind on my mortgage. I’ve done everything I can to stay ahead, but I still fell behind. I would like to be considered for a loan modification to decrease my payments and interest rate to keep this from happening again, give me a fixed rate to prevent the payments from increasing down the road, and to recapitalize the delinquent payments. My number one goal is to keep this property for the long term.

I work as a (job) for (employer). In (month and year), I hit hard times financially because (hardship reason). Since that time, (reason hardship is over or at least stabilized). My income is now (back to normal, lower than before, whatever).

Despite my recent hardship and reduction in income, it is my full intention to pay what I owe. Now that (reason hardship is over), I would appreciate if you can work with me to lower or recapitalize the delinquent amount owed, lower my payments, and fix the rate for 30 years so that I can afford to keep this home for the long term and make amends with (lender name).

I pray you will work with me on this. I’d like to get it settled so we can both move forward without problems ever again.

Sincerely,

(Client signature)

(Client Name, typed)

Article Source: http://www.articlesbase.com/mortgage-articles/loan-modification-hardship-letter-template-704886.html

About the Author:

If you'd like to learn more about starting a loan modification business, or if you want to access all the necessary forms, spreadsheets, and templates, click here:



http://StartALoanModBiz.com

Matt Sparks is a successful entrepreneur, both offline and on. He is also a licensed mortgage broker, employing real estate broker, and Realtor. He has written books, articles, and blogs about small business, real estate, finance, New Urbanism, and sustainable cities.

Mortgage Credit Insurance is Not Required

How Abusive Credit Insurance Leads to Foreclosure

By: Nick Adama

Some homeowners, when they originally purchase their home or refinance, are pushed into an expensive "credit insurance" policy. Despite how they are sold to the borrowers, though, these schemes can often just be one more way that lenders enrich themselves by taking advantage of the financial ignorance of most borrowers. Abusive credit insurance can also be used as a defense against a foreclosure lawsuit.

But what is credit insurance? There are two common types of it -- a credit life policy and a credit disability or accident and health policy. Both can be abused by lenders when they force expensive policies on borrowers who may receive little or no benefit from them. Although some policies may be advisable in some cases, expensive policies that have limited or no benefit for the borrowers are a sign of abuse.

Credit life policies will pay off the existing mortgage in the event the covered person dies. Credit disability coverage is designed to be used by borrowers to pay their monthly mortgage expenses in the event of a disability or other interruption in income due to health reasons. Both can be quite helpful for homeowners in certain situations, but these types of insurance are also offered cheaper through other sources.

One reason that other insurance providers may offer such policies cheaper is that the lender, when it pushes homeowners into a credit insurance policy, is often compensated directly by the insurer. The insurance company pays the mortgage origination company for placing the insurance, which gives lenders incentives to recommend the highest-cost policy available.

The potential abuse of such policies comes from the way that the creditors (the mortgage lenders) benefits from the sale of the insurance. Lenders receive a commission, in most cases, determined by a percentage of the total premium the borrowers have to pay. The higher and more expensive the coverage, the more then bank gets paid by the insurer. Of course, this means that the highest cost coverage is offered.

Also, borrowers who purchase a credit insurance policy voluntarily may have the premiums added to the balance of their loan amount. This means that the bank will be able to charge interest on the insurance policy premiums, thereby increasing the cost even more over the life of the loan. This raises the effective interest rate of the loan and increases the profit of the loan to the bank.

While most homeowners may just not be aware of how these policies work and the lenders' incentive in offering them, the practices described above may not be outright abuses. However, some borrowers have been pressured into paying for insurance policies where they are ineligible to receive any benefits under the terms of the policy. This is an obvious abuse and mortgage companies can be held responsible for it.

However, the most important point for homeowners to remember is that they have a choice with these policies. If the lender is forcing them into one, they can always go with a different bank or lower coverage amount. A future article will look at how the insurers inappropriately deny benefits even for borrowers who have adequate coverage, as well as legal claims against the lenders and insurers.

Author Resource:-> Even with all of the government programs available, still only 9% of qualified homeowners receive a loan modification. Nick is helping to change this, by providing more information to borrowers and their advocates, and showing them how best to approach mortgage modification. Visit his site on the web to learn more: http://www.foreclosurefish.com/modification.htm

Article From Articlebliss

4 Effective Mortgage Foreclosure Delay Tactics

Foreclosure Prevention - Prevent Foreclosure by Delaying the Process For a Few Years Payments-Free
By Alfred Sant

Many different foreclosure prevention techniques are used everyday by homeowners facing the possibility of foreclosure. I'm going to focus in very unusual yet very effective methods to avoid foreclosure even for a few years and without making any monthly mortgage payments; I'm talking about avoiding foreclosure by delaying the foreclosure process.

The foreclosure prevention by delaying the process has many advantages; you stay in your home payments free for a very long time and offer you the possibility to qualify for a mortgage modification program in the future among others advantages. Most of the strategies used to delay foreclosure can be applied free and you can do it on your own.

Foreclosure prevention techniques: To prevent foreclosure by delaying the process you first need to know how does foreclosure work and how is the foreclosure process followed. If you have a basic idea how this process work, use the following strategies to delay the process.

Respond the foreclosure Summon. By responding the foreclosure letter directly to your lender, if you know how to do it properly, you may stop the process for a few months.

Negotiate the late payments. By agreeing to a repayment plan of the late payments your lender may agree to stop the process. You are not negotiating a mortgage refinancing but your current already late payments.

Requiring a Court Hearing. This is a very effective yet little used technique to delay foreclosure for a few months in some instances.

File for bankruptcy. This is a very controversial but often used foreclosure prevention strategy. Filing for bankruptcy, if doing the right way, may delay the foreclosure process for a very long time and at the same time, gives you the opportunity to save your home. Filing for foreclosure should be one of your very last options and it is not a decision you should take lightly.

Foreclosure is a process and there are ways for you to delay that process and stay in your home mortgage-free for a few years even if you do not qualify for The Obama's Loan Modification Plan or any other Program, even if you have not income at all. Unfortunately, most people don't know about the many tactics and strategies available for fighting foreclosure.

To stop foreclosure and stay in your home is of up-most importance not only because it can potentially save you thousands of dollars, but because it will ensure that you maintain the ability to qualify for future programs.

For more detailed information and for tips and strategies to avoid foreclosure and stay in your home for over two years without making any monthly mortgage payments, go to: How-To-AvoidForeclosure.info Click Here: How To Stop Foreclosure Remember, you can do this without paying for Lawyers, Agencies or for any service at all. Click here to save your home Foreclosure Prevention

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Mortgage Fraud Schemes could make you a victim

Top 3 Mortgage Fraud Schemes to Watch Out For
By Kevin Sandridge

Recently, the Mortgage Banker's Association released a report that echoed findings by the Mortgage Asset Research Institute describing three of the most recent mortgage fraud schemes rising in the ranks in terms of popularity. Know what these are and watch for them.

1. Foreclosure Prevention Schemes

Foreclosure prevention schemes typically involve some sort of self-proclaimed foreclosure specialist who promises to help you keep your home - seemingly out of the kindness of their heart. These"foreclosure specialists" contact homeowners at risk of foreclosure and promise to work out their mortgage loan problems - sometimes by buying your home and allowing you to live there as a tenant. What happens more often than not - however - is that this type of scam ends up with the company buying your home and then selling int out from under you. They may allow you to stay in the property and pay your agreed rental amount, but it is very likely that they'll be negotiating the sale of the home at the same time. Once the home sells, you can be evicted, with the fraudulent individual leaving town and moving on to their next opportunity.

2. Fraud Against Immigrants and the Elderly

Elderly and Immigrant fraud is, unfortunately regaining popularity. Once prominent forms of fraud, these practices are rising again. What happens is this: consumers who are elderly or have limited English-speaking capabilities fall victim to fraudulent individuals who use them as "straw buyers" or create fraudulent loan transactions using their information. Sometimes elderly or immigrant renters are asked to sign documents that are actually forms that open up access for these folks to inquire about or post as those in control of your credit.

3. Builder Bail-Out Scams

Builder bail-out scams consist of a fraudulent individual who collects money from you for say - condominium conversion - with no plans for the work to be completed. The scams involve a host of purchases from potential investors using false identities on fraudulent loan transactions. Investors are shown convincing photos and mock ups and are allowed to tour converted units used as models - reassured that their conversion will look the same. However, as soon as the contracts are signed, and money is given over to the contractor, work on the conversion stops - with investors and lenders being left with incomplete and, in some cases, unlivable dilapidated buildings.

Was this article helpful? If so, take a read through the Florida Home Loan Report to find articles on similar topics.

The Florida Home Loan Report, always on hand to provide useful financial information.

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Tips for fighting Mortgage Foreclosure guaranteed by HUD or FHA

Relevant Court Cases to a HUD or FHA Mortgage Foreclosure

By: Nick Adama

When a mortgage is insured or guaranteed by the Federal Housing Administration (FHA), an agency overseen by the Department of Housing and Urban Development (HUD), servicing companies must follow HUD servicing guidelines. Some of these regulations involve the foreclosure process on a such a property, and failure to follow the guidelines may be used by homeowners to defend their foreclosure in court.

The following is a list and brief description of some of the court cases that have involved HUD and FHA loans that were improperly serviced, ones that were decided in favor of homeowners, and ones in which borrowers facing foreclosure were denied claims. Knowing some of the background of these cases may help homeowners decide if their loan is being properly serviced, or if it is worth their time to apply for an FHA loan.

One of the requirements to foreclose on a HUD loan is that the servicer must attempt to hold a face-to-face meeting with the homeowners before three payments have been missed. In Banker's Life v. Denton, homeowners raised the failure to hold the meeting as a defense against foreclosure. Also, the servicer did not send the request for the meeting via certified mail or attempt to visit the borrowers at the property. The court found for the owners in this case.

Notices of default must also be sent to delinquent borrowers in accordance with the HUD regulations. In Federal National Mortgage Ass'n v. Moore, homeowners raised the argument that the lender had not sent out a notice of default that was in compliance with HUD's regulations. The notice sent, according to the borrowers, was not valid because it was on a form that was not "approved by the Secretary" of HUD and was not sent in a timely manner as the regulations require.

Since these two cases had been decided, HUD's regulations have changed, but the language of the preforeclosure servicing, including notice requirements and review guidelines, have remained the same. In fact, another court case, Mellon Mortgage Co. v. Larios, decided that the requirements are the same now as they were before the statue was revised. Lenders failing to comply with these guidelines can still be used as a defense against foreclosure.

The face-to-face meeting with homeowners is also an important aspect of foreclosing on a mortgage backed by HUD. The minimum requirement to comply with this regulation is visiting the borrowers at home and sending at least one letter via certified mail. The issue came up in Washington Mutual Bank v. Mahaffey, and the lender was denied summary judgment because it had not sent the letter, even though someone had been sent to the property to visit the homeowners.

Of course, this is not to imply that every homeowner will win a case and successfully defend against foreclosure. Courts have also ruled against borrowers who raised issues regarding servicing. In Miller v. G.E. Capital Mortgage Servs., Inc., the court ruled that private citizens have no right to sue for violations of HUD's loss mitigation provisions. The law, according to the court, is meant to focus on regulation of lenders -- not creating rights for borrowers facing foreclosure.

Also, courts have found that the language included in deeds of trust insured by the FHA are not negotiated contractual terms. Instead, they are imposed by the FHA on both the borrowers and lenders, and the borrowers may not raise defenses in relation to breach of contract if lenders fail to follow the FHA guidelines. This case was decided in Wells Fargo Home Mortgage, Inc. v. Neal. If the homeowners and mortgage company can not bargain for that aspect of the contract, there can be no breach of the contract.

Homeowners, their loss mitigation professionals, and their foreclosure attorneys should become aware of some of the issues involved with HUD loans if they have a mortgage insured by the FHA or are considering taking advantage of the new government programs. While some protections may be offered to borrowers, others seem to be taken away by the courts if there is a question about a foreclosure. Knowing the issues through previously-decided court cases can help educate borrowers.

Author Resource:-> Nick writes for the ForeclosureFish website, which gives homeowners the advice and resources they need to avoid foreclosure on their own and fight back against the bank's lawsuit. The site describes numerous methods to save a house, including foreclosure refinancing, deed in lieu, repayment plans, stopping a trustee auction, bankruptcy, and more. Visit the site on the web to read more about how you can avoid foreclosure and eviction, repair your credit, and establish a long term financial plan once a crisis is over: http://www.foreclosurefish.net/

Article From Articlebliss

Are you Eligible for President Obama's Mortgage Loan Modification Program?

Eligibility Requirements Under Obama's Loan Modification Program

Author: Walter Sigmore


Do you have questions about Obama's loan modification program and who is eligible to participate in it? Are you wondering which financial institutions are providing loan modification options using the $75 billion allocated by the Treasury Department? Keep reading for some answers to these questions and more.

Lender participation in the federal program isn't required, but many financial institutions have already signed up and many more are eager as modifying a loan is a much preferred alternative to foreclosure. Also, under Obama's loan modification setup, lenders are being offered incentives to participate in this plan that is expected to protect four to five million American homeowners from losing their homes.

The federal loan modification program has the following requirements for eligibility:

- the loan being modified must be a first mortgage on your primary residence

- the loan being modified must represent a monthly payment > 31% of your monthly income

- the loan being modified must not be delinquent

- you must be able to provide proof of your income

In order to process your application for the federal modification program, you must provide the lender with a detailed hardship letter, a thoroughly completed application form, a detailed income statement, and proof of your debt. There is no fee associated with applying for modification under the Affordability and Stability Plan.

Not only are the lenders who agree to participate in the federal loan modification system being provided incentives, so too are homeowners. For example, if you pay your newly modified loan as required for five years, you may qualify to receive a $5,000 bonus.

Don't procrastinate applying for relief through the federal loan modification program. Avoid the rush and inevitable glut of paperwork that's going to start rolling in and get in front of your lender before the crowd.

Article Source: http://www.articlesbase.com/mortgage-articles/eligibility-requirements-under-obamas-loan-modification-program-1163804.html

About the Author:

For more information about Loan Modifications, visit the #1 loans modification resource on the net: http://HomeLoanModifications101.com