My Mortgage Loan Modification True Story
Hi my name is Sonny Collova and I have decided to share my very own mortgage loan modification story.
Today I am just writing the about my initial phone call, my personal situation, and the application (submitting the initial paperwork) process.
I will update my story as it unfolds almost in real time.
My situation is that I moved into my father’s second home soon after he closed on it and agreed to make the payments and pay the loan off. Being in the mortgage business my income has declined by 75% over the last two years.
This home has also dropped from the purchase appraised value of $360,000 to $235,000. We paid $310,000 thinking that we were paying 50K under the appraised value. I owe about $244,000 on a $248,000 6.25% 30 year fixed conventional Freddie Mac Backed Mortgage. Wells Fargo needed over $7,000 in CLOSING COSTS brought to the table for the HARP refinance program (Making Home Affordable Refinance Program) with a max LTV (loan-to-value) of 105%. So the loan I am modifying is not in my own name but since I am making the payments of $2056 per month and have been for over two years. I can apply using my income, hardship, and asset information. I needed my father’s written authorization and will need a financial statement from him and his monthly expenses too.
I called my lender Wells Fargo a couple of weeks ago and they only asked for three things. A hardship letter, proof of my income, and to write down my monthly expenses. I was surprised they did not have any kind of application or anything , just use a blank sheet of paper they told me.
I lost the fax number so I called again today and even though my loan is current I had to get routed to the loss mitigation department since they handle the loan modifications. Amazingly there was almost no hold time and I got right through after being transferred one time. I retold my story and the guy seemed surprised that I wanted my payment reduced from $2056 to around $1400. He said “that’s over six hundred dollars per month!” I reminded him that the HARP refi was going to save me $300 per month (6.25% to 4.75%), that I did not qualify with out bringing the 7K in closing fees, and that I can now really only afford around $1400 per month. So he gave me the fax number, told me to sign and date everything, and put my loan number on all of the documents.
Being motivated to get this done, I gathered a P & L from my father’s company, filled out the budget spreadsheet found in my DIY Kit, and used the hardship template letter also in the DIY Loan Mod Kit. I also sent in a print out from my bank account for the last two moths to prove my expenses claimed on the budget and to prove my income since I do not get paychecks just commission payments form the company that I deposit. Oh the Wells Fargo Guy said to call exactly three days after I faxed my documents to make sure they were received. So that will be my next update after I call to see if the actually got what I faxed in. Then I will just sit and wait for a few weeks until I hear from them.
I called in to follow up on the paperwork that I submitted. I was a little surprised that the lady that took my call went over all of the financial information and took it right over the phone (even though I sent it in writing). She asked for copies of my checks to prove income and told me to call back after I have sent them in. Read: How to get the best Gap Insurance
I sent in copies of my income checks and spoke to someone else this time. He again went over my financial information and other documents I had previously submitted. He suggested I send in some back up proof of my income and said it would take another three weeks for a negotiator to be assigned to my account and that they would contact me in a few weeks. We’ll see…so far smoother than I expected though.
Ok. It feels like I may be getting somewhere after about 30-45 days so far into the process. I got a letter in the mail today and it was a Wells Fargo Completed Mortgage Loan Modification Application for me to update and sign and return. I immediately updated and signed the form. It also said to send in proof of my income again (I have already sent this in twice). I faxed the form without proof of income. I need to find my check copies and resend in the form with the checks attached.