How many of you have talked to someone looking for a loan modification? I have spoken to a few people who have opted to try and receive a loan modification instead of short selling their home. I know that this can be a difficult decision on the part of the homeowner and we certainly don't want to see anyone lose their home.
My reading this weekend included some interesting findings with regards to loan modifications and their issuance and subsequent success. The information focused on the Home Affordable Modification Program which is intended to help homeowners keep their homes. The study found that the success rate for receiving a loan modification was very low. It also found the process to be a paper work nightmare for homeowners.
Most request for a loan modification had some sort of incident with loat or missing documents. In one case the entire file was lost 8 times. Does this sound familiar? This seems to be a consistant problems with banks and loan servicers less of course the error or gain is in their favor. To add insult to injury some homeowners received modified payment plan only to receive notices informing them they didn't qualify for the program months later. In some cases they received foreclosure notices with no warning of failure to qualifying into the program.
The horror stories will continue in part due to the fact that the oversight program designated to oversee that financial institution abide by the regulations set forth in the Home Affordable Modification Program are followed. To date not one bank, loan servicer or financial entity has been fined for bungled paperwork or improper foreclosures. I wonder what the future will bring?
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