Short Sale, Foreclosure and Strategic Default

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Wednesday, October 1, 2008

Loan Modification - Thi

Gov't launches mortgage aid program: Financial News - Yahoo! Finance
Investors would rather modify loans in ways that maintain the ability to "share in future appreciation," JPMorgan Chase executive Marguerite Sheehan said in written testimony submitted to House lawmakers last month.

On Monday, a group of state banking and law enforcement officials released a report that said nearly 80 percent of borrowers with subprime loans were not on track for assistance to avoid foreclosure as of May.

The report by the State Foreclosure Prevention Working Group criticized the lending industry for making only small changes to loan terms and noted that about one in five loans that were modified over the past year became delinquent again.

"While banks and Wall Street firms continue to report record write-downs of mortgage loan portfolios and securities, the losses do not appear to be flowing down to homeowners in the form of sustainable loan modifications," Iowa Attorney General Tom Miller, a founder of the state effort, said in a statement.

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Note that lenders generally make only small changes.  If you want to make big chances you have to find ways to gain some leverage on the lenders.  Just paying any old person a few thousand dollars to put together a loan mod app  - is probably not the best use of your time and money.

California has laws on the books that may help you gain some leverage against you lenders.  If you are going to spend a few thousand dollars why not work with someone who can use the law on your behalf. 

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