Saturday, January 10, 2009

Loan Modification Frequently Asked Questions - HUD

There are few good questions on the following link to the Hud website.



Loan Modification Frequently Asked Questions - HUD: "Loan Modification
Frequently Asked Questions


A Loan Modification is a permanent change in one or more of the terms of a mortgagor's loan, allows the loan to be reinstated, and results in a payment the mortgagor can afford.

Question 1: In utilizing the Loan Modification option to bring an asset current, can the mortgagee include all fees and corporate advances?

Answer: Mortgagee Letter 2008-21 states in part: Legal fees and related foreclosure costs for work actually completed and applicable to the current default episode may be capitalized into the modified principal balance.
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Question - Many people wish to negotiate a loan mod without going into default on their loans. Can a homeowner be current. The only way to really find out is to try. Many lenders want the borrower to be 60 days late before they will negotiate. However, there are exceptions.

Before you go into default you should consider all your options.

Loan Modification

Thursday, January 8, 2009

Mortgage Cramdowns, Bankrutpcy bill to give homeowners leverage against Lenders

Wow would this be heaven for San Diego Real Estate owners, or at least homeowners. 
You could cram payments down the first and perhaps sold out second lien holders

There might be some down side to the measures... but I do not want to get in the way of this. 


Plan to Cut Foreclosure Rate Clears Key Hurdle - WSJ.com
WASHINGTON -- A Senate bill aimed at giving strapped homeowners more leverage in renegotiating their mortgages cleared a hurdle Thursday when Citigroup Inc. dropped its opposition.

The legislation, which is being advanced by top Senate Democrats, would let judges set new repayment terms for mortgage holders in bankruptcy court. Lawmakers say the measure is aimed at jump-starting broader efforts to renegotiate millions of underwater mortgages now weighing down the housing market.

The proposal from Sen. Dick Durbin, an Illinois Democrat, to allow so-called mortgage "cramdowns," would apply only to homeowners who have filed for Chapter 13 bankruptcy protection. It is the first of several pieces of legislation Democrats intend to push this year to give homeowners more leverage in bargaining with banks and mortgage-servicing companies.

Sunday, January 4, 2009

Predatory Upfront Loan Modification Fees | Rain City Guide

The following is a comment about "attorney backed" loan mod schemes. Please note the discussion which takes place around this post is not based on California law. But the principle laws are similar in many regards. Basically attorneys are in jeopardy of losing their licenses when then get involved in fee splitting arrangements.


Predatory Upfront Loan Modification Fees | Rain City Guide: "his is a scam. Any good bankruptcy attorney is capable of doing a loan modification without filing bankruptcy. Some real estate attorneys may do it as well. They will also explore the client’s other legal options.

Loan modification firms causing more problems for homeowners : Real Estate : The Rocky Mountain News

Loan modification firms causing more problems for homeowners : Real Estate : The Rocky Mountain News: "Lee Monson said she and her husband, Rich, paid a San Diego-based loan modification company almost $3,000 in June to keep from losing their Parker home to foreclosure.

Their home now is in foreclosure and she has turned for help to the Colorado Division of Real Estate, which is in the midst of a major investigation of loan modification outfits.

'I think they should be put out of business,' Monson said about Peoples First Financial in San Diego, the company that she said kept their money and did nothing for them."

California Foreclosure Consultant law and Loan Modification

Warning to those who have working on california loan modifications for others.

The following link will take you to the California Foreclosure consultant act.
Everyone charging California real estate owners money to negotiate loan modification should be aware of this law. It restricts the actions of non attorneys.


California Real Estate Law: "California Foreclosure Consultant law
People doing loan modifications need to be familiar with this law.

Note: Even if you have a retainer agreement approved by the California Department of Real Estate, a non lawyer is not allowed to take money up front from a homeowner after a Notice of Default is filed.

CIVIL CODE
SECTION 2945-2945.11"