DO I QUALIFY FOR A LOAN MODIFICATION? WHAT WOULD THE PAYMENTS BE?
We have the resources to research the specific Trust, Investor or Servicer and identify the specific Modification programs available to clients. We can also determine eligibility for the specific Modification programs by performing waterfall tests for all published modification programs. Also offering aggressive loan modification representation to monitor lenders’ compliance with the new federal rules.
Understanding Loan Modification and Your Rights as the Borrower
It is important to understand your rights as a borrower in regards to loan modification. There are powerful new regulations that have been promulgated by the Consumer Finance Protection Bureau (“CFPB”) under the Real Estate Settlement Protection Act (“RESPA”) and the Truth in Lending Act (“TILA”) that finally give borrowers the right to sue when mortgage loan servicers fail to meet their servicing obligations.
Mortgage Servicers MUST:
- Issue a decision within 30 business days of receipt of a complete application for a Loan Modification, Short Sale, or Deed in Lieu of Foreclosure;
- Advise the borrower within 5 business days after receipt of an application, if there are any additional documents needed;
- Stop any and all action in a foreclosure, while a complete application is being reviewed;
- Provide information properly requested about ownership of note and mortgage under TILA within 10 business days; and
- Provide information properly requested about loan payments, loan history, and other loan information within 30 business days.
- Provide payoff or reinstatement figures within 7 business days of receipt of written request
If a servicer violates these regulations, there can be liability under Regulations X and Z for statutory damages of $1000 to $4000, attorney fees, and compensatory damages (including emotional distress, legal fees, credit diminution and other losses).
You may have a Good Case Under RESPA Regs if:
- You have submitted a complete loan modification application and loan servicer moves forward in any way to foreclose. (This includes Filing of a Foreclosure Complaint, Filing a motion for relief from stay in Bankruptcy, Applying for Final Judgment, or Setting a date for a sheriff’s sale or failing to avoid a judgment or withdraw a sale.)
- Mortgage Servicer fails to honor an agreed to Loan Modification. (Even if your loan was transferred to a new Servicer, they must honor the modification)
- Mortgage Servicer fails to make a decision on a Short Sale within 30 Business Days.
- Mortgage Servicer refers for foreclosure before a borrower is 120 days past due.
- Mortgage Servicer charges for unnecessary appraisals, legal fees, property inspections, and other corporate advances.
You may have a Good Cases Under TILA Regs if:
- Mortgage Servicer Fails to Provide Correct Information on Monthly Statements to Borrower (Borrowers in Bankruptcy are currently exempted) For example, the statement shows the improper interest rate.
- Mortgage Servicer fails to send statements at all (Borrowers in Bankruptcy or Discharged from Bankruptcy are currently exempt)
- Mortgage Servicer takes money from suspense for payment of fees or corporate advances, before principal interest taxes and insurance are brought current.
- Mortgage Servicer fails to provide the name of owner, master servicer and servicer within 10 business days of the date of receipt of written request.
- Mortgage Service fails to provide payoff or reinstatement figures within 7 business days of receipt of written request.
Clients who could benefit from Reg X and Z Case Review:
- Borrowers who have been recently discharged from Chapter 13 or Chapter 7.
- Borrowers who have filed Bankruptcy to avoid Foreclosure but who had an application for loss mitigation pending.
- Borrowers who had a contract to sell their home by way of a short sale, and the Servicer failed to make a decision within 30 business days from submission of application and the buyer withdrew.
- Borrowers with loan modifications where the loan modification has not been honored by a loan servicer or successor loan servicer.
- Borrowers who have trial loan modifications that last beyond three months.
- Borrowers with Lender Placed or Forced Placed Insurance.
- Borrowers with excessive escrow deficiencies.