How Our Loan Modification Process Works

• The first step is the free consultation. Simply call the number on this web site or fill out the form and one of our advocates will contact you within 24 hours.
  
• Loan modifications at US Mortgage Advocate are completed in phases, the "Processing Phase" "Submission Phase" and the "Negotiating Phase.” Each phase is independent of each other and you may elect to hire us to do just the processing phase for you and you may submit and negotiate with your Lender. Once the processing phase is completed, you may subsequently hire us to complete the submission and negotiating phase with your Lender. We will submit your completed loan modification package to your Lender and begin direct negotiations with them, or you may elect to have us send the completed package to you so that you may submit the package to your Lender and perform your own negotiations.
  
• After our initial conversation, we will be able to determine if you fit within the parameters for our loan modification program. During this initial consultation, you will be asked a variety of questions, including information regarding your income, all debts, and other items in your budget, including exact balances, monthly payment amounts, and account numbers for all installments and revolving lines of credit. We will need property tax information and homeowners insurance amounts, health and life insurance premium amounts, electricity, gas, groceries, cable, child day care etc. Please have these figures ready and by all means, please answer them truthfully and candidly as this will only benefit your overall situation.
  
• If we unilaterally determine that you fit within our program, then we will send a Loan Modification Program Agreement containing a Borrower's Authorization and disclosures. The Borrower's Authorization enables our team to communicate with your lender.
  
• In conjunction with the Loan Modification Program Agreement, we will send you the Loan Modification Financial Worksheet. These documents will address detailed aspects of your current and past financial history and include the budget figures that we mentioned above. Our loan modification specialists will work with you to complete these documents. Also included will be a list of documents that we will need you to send to us by email, fax or mail including items such as W-2's, tax returns, pay stubs and a hardship letter which spells out in a detailed, yet concise manner, the hardship which occurred causing your inability to meet your monthly mortgage obligations. This can include events such as a loss of job or income, an interest rate increase, separation/divorce, a medical reason or death etc. that caused the hardship. We will help you to write such a letter and you we will provide you with several sample letters. We will then work diligently to complete your loan modification package for submission to your Lender.
  
• Within 24-48 hours from when we receive all of your documents, we will review your entire file and supporting documents that you have supplied and we will exercise one of the options in our written Money Back Guarantee.
  
• Once your loan modification package is completed, you then make the determination if you would like us to send the package to you so that you may negotiate with your Lender or if you would prefer to hire us to perform that phase on your behalf.
  
• The process generally takes between 60-90 days to complete but depending on each individual lender and how busy they are it can take longer but this is usually not the case. But the only constant in this whole process is "change.” That's one of the biggest reasons to hire a professional. Once complete, your lender will mail the new loan documents to review and sign. We strongly recommend that you do not sign the documents until you send them to us so that we may review them. We want to make sure that the documents stipulate exactly as we agreed and negotiated with your lender and that they do not contain lots of junk fees!
  
• Don't wait! If you do nothing the situation is not going to go away and will only get worse. The sooner you begin to be proactive; the better off you and your family will be in the long run! We can help and we want to help. Please call or fill out the form on any of these pages today for your free consultation.

US Mortgage Advocate LLC Disclaimer
Comments made on this web site by US Mortgage Advocate LLC and its affiliates and the materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. No advice or information, whether oral or written, obtained by you or through this web site shall create any kind of promise or business relationship.

Understanding the Loan Modification Process

First, you should know that you can absolutely do this yourself. However, there are several reasons why we recommend that you find an experienced, reliable Professional to handle your loan modification and we will cover those reasons below. We're are here to help you, and we will assist you in every way that we can, including listing in our Useful Resources section links to find information to guide you through the process if your desire is to attempt your loan Modification yourself.

On March 4, 2009, the Obama Administration also announced a new plan to help homeowners called "The Making Home Affordable" Plan that will work in conjunction with traditional lender loan modifications. You can view the guidelines here Making Home Affordable Modification Plan . As you can see by reviewing the Loan Modification Guidelines, they are quite confusing and intimidating for most people to even understand.

Here are your options:

1.       Do nothing! (Bad choice)

2.       Do this yourself.

3.       Go to www.hud.gov and try to work with a hourly paid government worker, in a system that is already overloaded and in crisis. We suggest that you call them and give it a try. You never know, you might be one of the lucky ones.

4.       Hire a highly experienced, aggressive Professional to get the job done for you for something that is as critically important as saving your home.

From the above statements, we might not sound very objective to you, and you'd be right! That's because we know the facts and they reveal that sadly, the incidences of success for those attempting a loan modification on their own is very low. “The average American trying to get through to their bank to negotiate a loan modification will not be able to get it done!” - U.S. Congresswoman Maxine Waters (January 21, 2009).

We're are aware that some well meaning Government Officials recommend doing this on your own and that you don't need to pay someone to do this for you. There have been quite a few scams out there that we're equally appalled by, and we're sure they're only trying to protect innocent Homeowners already struggling from being victimized. However, we're confident that if you do your homework and due diligence, you will find countless people who attempted to get a loan modification on their own and either completely failed or failed to get a significant enough result to make a difference. We've heard countless stories where the Lenders have just flat out refused to work with Homeowners, or agreed to modify their adjustable rate mortgage by freezing it at its current rate of 8.5% and not letting it go up any further. How does freezing it and not reducing the rate ease their situation at all and make their home more affordable so that the Homeowner can remain in the home? A couple questions might help to put all of this into a better perspective for you:

·         Do you do your own taxes? Do the same Government Officials recommend not paying a Professional to prepare your taxes either? After-all, it's absolutely possible for you to prepare your own tax returns, but most Americans hire a professional to do this for them.

·         If the Internal Revenue Service started a program whereby they offered to prepare your tax returns for you, would you hand them over your W-2's and let them prepare your taxes for you? Somehow we don't think there'd be many takers on that offer simply because they do not have your best interest at heart. Neither does your Lender have your best interest at heart. They have their best interest at heart.

·         Have you ever sold a home yourself? Again, do the same government officials recommend against hiring a professional to assist in selling your home? Again, it is absolutely possible to do on your own, most leave this to experienced Professionals.

·         Lastly, if you were in a car accident, it is widely accepted that you should never try to negotiate with the insurance company yourself that is if you want the best possible outcome for yourself. The insurance companies are only looking after their own best interest, and their only interest is to minimize loss for the company, not compensate you well, or even fairly from your perspective. Hiring a trained professional, usually an attorney in the case of a car accident is the best course of action. Just as with Insurance companies, you have to approach Lenders and all conversations very carefully. Everything can and will be used against you. Likewise, hiring a trained professional to handle your loan modification is equally important.

Much like in any important matter, having the proper guidance and representation can make all the difference in the world. It can save you time, trouble and money and ultimately, your home. There is an old saying that aptly applies here: "The most dangerous thing in the world is a little bit of knowledge!"

This is a very emotional time for you. This is your family, your life, your house. It is often very difficult for most people to completely set aside emotions and work strictly from a logical standpoint when it is something so near and dear to us and this important to us, and the ability, or inability to be able to set these emotions aside can be very important when negotiating with a lender. The same reason most Doctors will decline operating on a loved one or close friend and will recommend and defer to a trusted colleague. There are just too many emotions involved to do the job correctly.

The process of working with lenders and their many layers of staff can be inundating and frustrating. Trying to get a "live person" on the phone often can be a challenge, and trying to get the same person twice is even a bigger challenge for a homeowner trying to attempt their own modification. Your lender often has several separate departments to work with delinquent borrowers. The first is the collections department is employees who are highly trained in methods to compel you to get current on the payments. The second group consists of the loss mitigation specialists. This second group can go by different names, depending on the servicer, and they include foreclosure prevention, loan resolution and delinquency customer service. The most common name for the department is the loss mitigation department. It can be very difficult to get through to the loss mitigation department because collection agents are often trained and discouraged from transferring calls. This is one of the major benefits of having a Professional Loss Mitigation Specialist working on your behalf. A Professional will most likely have contacts within the loss mitigation department and will have worked with these contacts in the past many times and they have experience in navigating "the system.” Good working relationships are actually developed between them.

The final decision maker needs to be found. This is very often more difficult for a homeowner to do than a third party Professional. In most cases, the homeowner will not be able to get past the first level, and if you are lucky enough to get to the first tier in Loss Mitigation, this group of people are really just glorified collections department. They are hourly employee’s, often not paid very well, and lack the incentive and motivation to put forth the effort to sincerely help you to resolve your mortgage problem. Often they just compound the problem being rude and demanding that you pay your mortgage. So it’s essential that you get beyond these people and to a specialist who has final decision making power. Unfortunately Lenders and Servicers do not have enough trained staff or the capabilities to help everyone. Many people are simply getting lost in the system and suffering an unnecessary foreclosure when they could have worked it out with their lender. However, when a Profession Team of Loss Mitigation Specialist such as US Mortgage Advocate is involved, it seems as if the calls start to get answered and the letters responded to. Often this can make the difference between saving your home and losing your home. Remember, time is of the essence here and you do not have time to waste!

Loan modification outcomes are ultimately determined by a Lender. No one can guarantee what the exact terms or outcome of a loan modification will be. If you encounter anyone, or any company who is adamant that they can get you a fixed rate, a principal reduction, or they quote you a rate that they are adamant that they can get you, our suggestion is to walk away fast! These are nothing more than fast talking salespeople in our opinion telling you what they know you want to hear just to get paid. There are lots of them out there and it's appalling to us also. It bears repeating... No one can guarantee what the exact terms or outcome of a loan modification will be. Every case is different. . What we can and will tell you is that, in our experience, this is what we're seeing others get but in no way does this mean this is what we can get you. This isn't a one size fits all, it varies between situations, lenders and often between Loss Mitigation Specialist amongst the same lenders.

When our Senior Mortgage Analyst presents your properly presented loan modification package to a lender, we include with the package a letter reasoning that in order for this to work, in order to ensure that this homeowner can remain in the home and avoid foreclosure, which no one wants to see happen, this is what we need! We actually tell them what we need and we always ask for a reduction in principal which occur in less than 3% of the cases, regardless of what other companies promise!  The negotiation process often requires several rounds of negotiation. So we don't just prepare your package and leave it completely up to the lenders and chance as to what type of terms that you will get. We fight and negotiate hard on your behalf that this is what we need in order to make this work!

Lenders and servicers will look for several things when we submit a loan modification request. They look for a documentable hardship of course, and before they make the decision to decide to grant your request for a loan modification what they really want to know is if you can afford the new payment once the loan is modified! What they don't want to happen is that you end up back in the same situation, behind on your payments, a few months down the road. There is an art to making loan modifications work. You must disqualify yourself from your old payments and at the same time qualify yourself on a new payment structure; this can often be a tricky area to navigate alone. To understand what the lender or servicer considers qualified, you have to know how lenders calculate your income. The income you can use to qualify for a modification is different from traditional income calculations used to qualify for traditional loans. Moreover, the difference in the qualification guidelines is typically in your favor.

For a loan modification, you can qualify based on your documentable total household income. You can count income from almost any source: One of your Grandparents Social Security incomes if they live with you, income from child day care services, from a second job paid under the table, etc. so long as it can be proved. Proof must be in the form of bank statements showing t his money being deposited routinely, 1099’s or in some other documentable form as outlined in the submission paperwork you will provide the lender. In addition, if only one of two spouses was on the original loan, the other spouse’s income can count so long as it is documentable by seeing the money going into the bank when looking at bank statements, or some other means of proof.

An important distinction between US Mortgage Advocate and many other Loan Modification Company's that we have observed is that we take the initial position that "you can always get more with honey than with a baseball bat"! By this we mean that we try to position ourselves on the same team as the lenders. We want to develop a good friendly working relationship thereby creating a win-win situation for all parties involved. Many companies start off by doing a forensic audit and then threatening the lender with a lawsuit based on some violation they have discovered that occurred during your original loan origination process such as a discrepancy in your Truth in Lending statement, your right of rescission or some disclosure on some document. While there are indeed violations to be found, they are often not serious enough to send your Lender into a panic to give you your home for free and forgive your entire mortgage debt, as some would like you to believe!

There several reasons why we don't initially take this hard-ball approach and take a more friendly posture. First, as mentioned, the number of serious violations is not as significant as portrayed and some would like you to think. Second, if you start off the relationship with your lender by poking your finger in the lenders eye right from the beginning, threatening and posturing, good luck in trying to get the best deal possible. We prefer to view ourselves as a team working toward the same goal, creating a win-win situation for both you and your Lender. The homeowner gets to remain in the home and the lender has yet one less property to take back in the foreclosure process. Third, we save you money by not engaging an attorney until necessary and by not performing a forensic audit first. Attorneys are expensive! If we are unsuccessful during "peaceful" negotiations, then by all means we may then suggest a forensic audit, at which point if you decided to pursue this, it would cost an additional amount to have the audit performed by an Attorney. But we have been hugely successful by employing our preferred method of gentle persuasion toward a common goal! Everyone involved just wants to get this problem fixed...and move on!

Attorneys usually approach loan modifications from an entirely different perspective than experienced Financial Professionals do. An attorney’s life is about litigation, finding fault in the other party then suing! They often don't understand the mortgage process, how the numbers work, how to prepare packages so the numbers and files do not make sense to a Lender nor do they often know what the banks and lenders are looking for. That is why most of them pursue a forensic audit first; they don't know how to do it any other way. It's also important to remember the statute of limitations for challenging any violations in your mortgage origination process is just 3 years.

In our opinion, and in our vast experience, it is not necessary to have an attorney handle any part of the process in most cases. The key to successful loan modifications is submitting a package to your Lender that makes sense financially. An experienced, professional Negotiator can usually get the job done quite effectively. If by chance your loan modification is denied and we have exhausted every effort, we will explain and suggest other possible courses of action that you may take such as a short sale or deed in lieu of foreclosure.

Understanding the Foreclosure Process

(Please note that much on this page is quoted from Mortgage Daily News and Bank Rate and direct links are provided to each)

The foreclosure process varies in every state and it's imperative that homeowners understand this process. One thing is for sure, time is NOT on your side. But, an educated consumer is always an informed consumer who can make a "good" decision based on facts and we try to educate you throughout this web site.

Understanding the foreclosure timeline.

         

Day 1 - You are just falling behind and you miss your first payment by a day. No penalties will be assessed at this time.

Day 16-30 - A late charge is now assessed to your payment.
Your Lender or mortgage servicer will contact you for an explanation and to try and resolve the situation from deteriorating further.

Source Mortgage News Daily:

Quote:

"Day 45-60 - The servicer sends "demand" or "breach" letter to the borrower stating the mortgage terms that have been.
The borrower is given only 30 days to resolve the delinquent amount."

Quote:

Source Bank Rate:

Quote:

"Day 90-105 - The servicer refers the loan to its loss mitigation department / foreclosure department and retains an attorney or other firm to handle the foreclosure proceedings. Depending on the state where the home is located, the servicer's representative may record a notice of default at the local courthouse and it will be published in the local newspaper."

Quote:

Source Bank Rate:

Quote:

"Day 150-415 – A notice of trustee Sale is filed and the home is scheduled to be sold at foreclosure sale or auction. This time range varies due to individual state laws and requirements."

"States with judicial foreclosures / where foreclosures are done via the court system, can sometimes extend this period to a year or more."

"A foreclosure is a legal event and there are benchmarks that must be met. Once the case is turned over to attorneys, the impending foreclosure must be advertised, usually in both the local papers and in the largest and closest metropolitan daily. The entire process can take a very long time from initial default to the actual public auction of the property. If a member of the military is an owner of the property, there are additional safeguards required by federal and in some cases state laws from the beginning of the process, however, the meter is running. The longer the foreclosure takes, the greater the debt that accrues and the larger the liability the homeowner has, something that will become critical down the road."

Quote:

"Non judicial foreclosure states can foreclose in as little as two months.

Day 150-415 – Some states offer what is called a redemption period after the foreclosure sale in order to give the borrower time to purchase the property if they have the ability. However, most will be forced out of their home by the local sheriff’s department."

Quote:

Source Realty Trac

Quote:

"Customers should try to negotiate the best deal they can get without feeling guilty. Someone whose property has fallen in value significantly below the mortgage amount because of a neighborhood decline, for example, should consider pushing for a short sale or short refinance rather than a repayment plan. That way, the borrower doesn't pay more money than necessary. Nevertheless, the best way for consumers to get out of foreclosure without racking up extensive legal bills and ruining their credit histories is to start working on a solution before their problems get out of hand.

In no case should people take the step that is most often taken in this situation that is to stick your head in the sand and ignore it."