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17 Comments on So is it 1 or 55,000?
Hi Myrl:
Last week, I had a deal on my listing die at the 11th hour.
The investor would not fund the loan...
These buyers are now working with another mortgage company, direct lender.
In the meantime the buyers are homeless and my sellers are in boxes.
We're all very frustrated with this non-sense!
Wow Myrl, that is very interesting. Yes, now which is it? That is quite a bit of a discrepancy -- for NEWS to be reporting!!! Please update us if you end up learning more!!! Thank you!
It amazes me, from what I have seen so far, banks rather go for a short sale or a foreclosure instead of modifying a mortgage. My mortgage terms for the original owner would keep the home of the market and balance the prices. But no, Short sale is it. Unbelievable.
Indymac did a great job with loan modifications while under FDIC control. Independent bank ie. Wells Fargo don't have to modify loans.
It's just such a mess these days. I also have a deal like Toula mentioned and it's frustrating.
Myrl - It seems to me that the lenders all have a different formula for deciding which loan gets modified , which are granted a "Short Sale" and which ones are foreclosed on. The only problem I see is that they all have different formulas and nobody understands them.
Toula - Frustration is an understatement in many of these transactions. My son (also an agent) has a transaction going that sounds very close to your experience.
Marney - I was shocked by the 1 - 55,000 descrepancy being reported in close proximity to each other.
Anne - Some of the decisions made by mortgage institutions seem quite odd.
Mark - Indymac did a great job on a modification that I heard about in the last week or so. I've yet to hear a single success story out of Wells Fargo or Countrywide.
Laura - I absolutely agree with you. . .They all seem to have their own formulas as to how they operate.
With regards to loan modifications, the plan requires you to be 2 or 3 months late. There are so many people late that banks are over whelmed. They cannot handle the volume.
Toula: Loan mods are for refi's only.
Myrl, I have heard rumors of a successful loan modification program, but I've never spoken to anyone that actually got one done. We seem to get those properties listed as a short sale after the owner gives up on a loan modification. The good news is that their paperwork is all in order for the short sale since they've been working with the bank already ... to no avail.
Tony - In hearing from those dealing with Wells Fargo, I wonder if they aren't shuttling them onto that path. One family asked for a loan modification, and within a couple of days, was sent registered, return receipt requested, an offer of forbearance. The family didn't want forebearance, because Wells Fargo was going to charge them $7,000 for the privelege of doing so. The family continued to make their payments on time, but each month their previously posted payment stated, "Not Applied." A second family has been late on payments, had asked for loan modification, and was also provided an offer of forbearance. In the Indymac case, the family wasn't late on payments but managed to get a wonderful loan modification.
Jim - I've heard of only one successful loan modification personally. I am wondering if that is the one mentioned in the Forbes article - LOL. Quite honestly I'm beginning to think that loan modifications are mostly a myth for practical reasons, and for not so practical ones as well.
Myrl,
The more I read on Active Rain, the more I learn. You guys down there really go through hoops with the lenders.
If both CNN and Forbes reported the same numbers still does not mean it is true. The media will distort stories/facts/figures to sensationalize so people stay glued to the tube.
I suspect the discrepancy is between the numbers of loan modifications and The Hope For Homeowners Program refinance program, which are two different things. I've also read that about half of the loan modifications went back into default.
Myrl - I am not sure of current numbers but I do know that by the end of last year, while greater than 1 the number was very small. I believe the number lies somewhere in between, perhaps closer to 1 than 55,000.
Terry - The more ActiveRain blogs I read, the more I learn too. The collective tribal knowledge of this community is astounding.
Mark - There's likely some truth to that. However the Forbes number of 1 modification (from the "Hope" program) was mirrored by National Association of Realtors, which was supposed to have been the source. Although, I am a member of that association, I do have suspicions the number could have an agenda of having homeowners give up and just put their market into short-sale status, or foreclosure. It generates more business for Realtors that way.
Elizabeth - I've heard there is a high rate of default on modifications also. But, I haven't seen that many modifications in the first place. . .Again, I'm looking seriously at the agenda of those reporting the news.
Mike - I agree with you! It's almost as if the lenders have been drug with feet dragging to try to accomplish anything meaningful at all. And of course, if there is MIP/PMI in place, they don't have much incentive to do anything at all.
Hi Myrl, Well, this is certainly an interesting question, isn't it? And it would be really interesting if someone could come up with a correct answer? I wonder which it is? 1 or 55,000, or is it either or these? I will stay tuned...great question.
I know of three successful loan modifications, one by Wells Fargo and two by Bank of America. I wonder how significant what we hear is, though, because how many of my friends would tell me that they were unsuccessful and are nearing foreclosure? Might not be very many. Foreclosure is still seen as an embarrassment.
Russel - I suspect in 90 days or so, you will know whether it was a loan modification or a foreclosure. If it was actually a foreclosure, your friends will move away:-(
Sandy - I think the truth is somewhere in the middle - as it is most of the time in life:-)
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