Loan Mods MAY Be Easier

Today the US Treasury Department issued updated rules for the Home Affordable Modification Program (HAMP) that require large lenders to provide and maintain a single point of contact for borrowers through the entire loan mod process. This should make things a bit easier in keeping track of the progress of your HAMP loan mod while it is under consideration. It should also make it easier to communicate back and forth with your lender when pursuing a HAMP mod. A word of caution, however: this new rule only applies to the largest loan servicers. That is defined as those servicers with a program cap of a minimum of $75 Million. However, Treasury's also "encouraging" smaller servicing firms to also participate. Whether or not they do so remains to be seen. This new rule also applies to Federal short sale and unemployment-related home programs, more formally known as Home Affordable Foreclosure Alternatives (HAFA) and the Home Affordable Unemployment Program (UP).The new rule also doesn't apply to second lien situations that may be covered by other Federally supported programs.
The way it works, basically, is that not later than September 1, 2011, a servicer MUST assign a relationship manager to all borrowers who may be eligible for HAMP mods, and by November 1, must assign by November 1, a relationship manager all borrowers who are either in a HAMP, HAFA or UP plan, or have executed a short sale contract or deed in lieu agreement. Once the relationship manager is assigned, the rule goes on to set specific requirements of how the servicer/borrower relationship must then proceed. For the details, check with your servicer or try the US Treasury (USTreasury.gov website; then go to Making Home Affordable tab).

As always,
Good luck.

Some Help From Bankruptcy Court

For the full legal details of the following, you'll have to call your attorney, or, if you cannot afford one, Legal Aid. But this morning, I just learned of a very interesting detail of the US Bankruptcy law. It's not very well known, even though it's apparently been the law for quite some time now. But it can definitely benefit those of you using bankruptcy to avoid foreclosure.

Basically, it goes like this. Your first mortgage cannot be eliminated by filing bankruptcy if you plan to continue to live in the home; it can only become one of your debts to be paid under your approved bankruptcy payment plan, assuming the court approves of your plan. BUT, and that's a very big 'but', if you have a second mortgage, it may be possible to totally eliminate it if there is no equity left in the home after the first is accounted for. The elimination doesn't happen instantly. Rather, the first becomes part of your repayment plan and the second is put on hold for the duration of the repayment plan, frequently 3-5 years or more. At the end of that time, assuming the debts have been handled according to the plan, the second mortgage is eliminated.
Something this important definitely is worth a call to an attorney if you have a second to consider.

As always, good luck.

Bank of America To Offer More Help

In an announcement yesterday, BofA said it is increasing the number of foreclosure prevention/customer assistance centers around the country. Presently a dozen in number, the bank said that beginning in July it will add another 28 to bring the total to 40 nationally. This expansion will see centers added in 22 states. For details, call your BofA branch or loan officer.
As always, good luck!

Good News in S. Carolina

For those of you in SC, there's good news this morning! The state Supreme Court has ruled that all foreclosure actions by banks must be halted as of May 9, until the lender can demonstrate that it has attempted to pursue either a loan modification or other loss mitigation action. This effectively does a couple of things. First, it requires that your bank work with you to try to achieve a loan mod or alternative action to avoid foreclosure. Second, it eliminates, for the present at least, the situation known as "dual tracking" that I talked about here just a few days ago. In cases where the lender attempts a solution with the borrower, but is unable to accomplish this, the ruling requires the lender to certify this to the borrower in writing. More info on this good news? Call your attorney, and if you don't have, or cannot afford one, call Legal Aid.
Good luck.

Dual Tracking Derailed by FED

Well, if you're in the process of trying to get a loan mod situation and simultaneously facing foreclosure, you may have just gotten a lifeline thrown your way! Frequently, people facing an imminent foreclosure on their homes try to avoid it by applying to their lender for a loan modification. Some succeed, some don't. However, all too often the left hand in the bank never tells the right hand what's going on and the foreclosure happens even when a loan mod is underway, or, in some cases, approved. This is what's referred to as the 'dual track'. Under new regulations issued by Federal regulators this month, banks MUST cease foreclosure action against any homeowner who has been approved for a loan mod, regardless whether the approval is a trial loan mod or a permanent one. If you are in this situation, get in touch with your banker IMMEDIATELY, and get confirmation, preferably in writing, that your lender is aware of this new regulation and has covered your situation with it.
For those of you in California, a new bill is in the state Senate, SB729, that would go even farther if approved. Authored by Mark Leno and Darrell Steinberg, it seeks to immediately stop foreclosures the instant that a loan mod application is made. This would allow the homeowner time to negotiate the mod with the lender without that foreclosure sword dangling dangerously over his or her head. At first reading, it failed to clear committee, tying 3-3. But another reading is scheduled on Wednesday, May 4. California Mortgage Bankers Association, as you would expect, is totally opposed to the bill. What to do? Call, write, email your legislator and tell them to support the bill. The home you save may be your own!

Good News In Florida

If you're in Florida and having trouble making your mortgage payments because you're either unemployed or underemployed, you just got some good news! The Florida Housing Finance Corporation, which has been providing financial assistance to make mortgage payments since last October on a test/limited pilot program, has announced that the program is now going statewide. Beginning on April 18 (which by the way for this Boston native is also Patriots Day--pretty good symbolic coincidence, don't you think?), homeowners who are out of work or just hanging on in a job level well below what they previously were before the recession gutted the economy, can make application for this assistance. It is estimated that the number of those qualifying for this program will more than double. It is directed at those up to 180days delinquent in mortgage payments. It will pay up to $12,000 for delinquencies, for up to six months, or until you can resume making the payments yourself, whichever cones first.Also, you must make at least 25% of the monthly payment yourself, minimum amount of $70. For more info immediately get in touch with the folks at Florida Housing Finance Corp!
And, as always, GOOD LUCK!

Good News in California!

The California Housing Finance Agency (CalHFA), a state agency to help homeowners, broadened its eligibility for a number of its programs to help California homeowners qualify for these programs dedicated to help homeowners in danger of losing their homes avoid foreclosure.The program, Keep Your Home California, is a federally funded program with $2 Billion to assist homeowners avoid foreclosure. There are three programs in this overall Program: Unemployment Mortgage Assistance, Mortgage Reinstatement Assistance, and Transition Assistance. UMA can provide up to $3,000 month;y if you can't pay your loan because of unemployment;MRA pays up to a max of $15,000 based on you documenting a financial hardship that';s preventing you paying your mortgage; and TA will help by funding your relocation costs if you are losing your home by foreclosure or deed in lieu. Each case is decided on its own merits. For more info, call your lender or servicer NOW!

GOOD LUCK!