Steps for Qualifying for Loan Modification

Question: I have been given a run around by my bank regarding a loan modification. They put me in a foreclosure and then rescinded. They assigned multiple representatives to my account. Recently they sent me a letter stating that I am not eligible for a loan modification, because I did not provide them the documentation they requested, although they had this documentation from me on file for a while now, but according to them it now needs to be updated. Our biggest fear is that they can put us in foreclosure and take our home away whenever they want to. So far, I tried working with the bank directly with no third party assistance. We sent them all requested documents months ago, only to be asked to start all over. We thought we were going to be approved for a loan modification, so that we can move on with our lives. But now we are at square one again. We have sufficient income, so we can afford the mortgage.

Response: There are a lot of criteria that need to be satisfied to be approved for a loan modification. Banks are so overwhelmed by the number of homeowners who are in default and are seeking assistance that is it almost impossible to find a bank that completes its deadlines to review the documents timely. You have to be patient and annoying and call the bank at least once a week to find out the status of the review. If anything is missing, it needs to be supplemented immediately. Otherwise, documents have such a short life span that within 60 days, documents will go stale and will need to be updated again and again. It is always best to send everything at once. If something is missing or income cannot be verified immediately and you need two new bank statements, you will have to resubmit all documents again (including updating all the forms which sometimes change its format). That's the first part of the puzzle. Second is actually qualifying for a loan modification. To get a loan modification, you must qualify, which means you have to be within specific income brackets to qualify in proportion to your total debt (including arrears). You can't make too much and you can't make too little since both of those reasons could disqualify you, among many others. Receiving a denial for missing documents is not the end of the road. Rather, it is the beginning for a new submission with all new documents. Before you submit, it is better to speak to a professional who has knowledge of this area so your financial situation could be properly assessed whether you qualify.

In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.

The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
Copyright © 2015 Law Office of Svetlana Kaplun, P.C.

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Bank Attorney's Fees in Foreclosure Cases

Question: The bank I have my mortgage with is saying that I have been behind on my mortgage for several months. I acknowledge that I am behind on my mortgage but by much fewer months than my bank suggests. When I tried to make a payment, I was told that I had 48 hours to pay the outstanding balance. I got the money together, but then the bank representative told me that they would not accept my payment because my case had gone to foreclosure and I need to pay the foreclosure attorney's fees now as well. On the other hand, my account manager told me to send the payment in, so I did and now he says that my case will be taken out of foreclosure and the bank will inform them if I owe them anything with regards to the foreclosure attorney's fees. Who do I believe and what will happen next?

Response: Generally, if your loan was referred to a foreclosure attorney, the bank cannot accept the money anymore and it has to go through their attorney's office to reinstate it so all the fees could be properly evaluated. In your case, you are not behind by much and it seems that the bank referred your case into foreclosure at its first chance. Generally, what it means is that the attorneys for the bank have to draft a summons and complaint and serve you with the papers. So, if their attorneys just received a referral but they haven't done anything that would have incurred fees yet, then it is very likely that the amount of arrears is still the same as you were told. You can also call the attorneys for the bank to double check but based on the short amount of time in default, the scenario you described could make sense.

In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.

The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
Copyright © 2015 Law Office of Svetlana Kaplun, P.C.

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Is Mortgage Company Obligated to Stop Foreclosure Proceedings by Accepting my Past Due Payments?

Question: My mortgage company offered to accept the past due payments on my account in the foreclosure process in exchange for stopping the foreclosure proceedings. Is the mortgage company obligated to stop the foreclosure by accepting the payment? I am not the mortgage holder but I am in the house with a filed quit claim deed in my name. Since I am not the mortgage holder I can't get anything in writing legally from the mortgage company stating their terms to me.  I have had a consultation with a real estate attorney, who answered some questions for me.

Response: That's right. As long as the bank receives its payment, they will keep on taking it. They will reinstate the loan, the payments will go back to their original terms and the foreclosure proceedings will be stopped. You can't get anything in writing because you are not the borrower. You would have to assume the loan to make it in your name and to have any new terms stated in writing. But if you are not trying to get a loan modification on your mortgage and just trying to resume to making payments, then you can just send the check to reinstate it and then continue making monthly mortgage payments. As long as you do, the bank will not bother you. As soon as you stop, again, the borrower, who is the person financially obligated under the note will end up in foreclosure, thus, risking losing the home that you own.

In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.

The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
Copyright © 2015 Law Office of Svetlana Kaplun, P.C.

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