Loan Modification Companies - How do they work? Has anyone used them?

We have been trying to do it ourselves since February with Chase, we have gotten the run around like crazy, you can never talk to the same person when you call, and your left to explain the situation over and over, they wanted a "good faith payment" we sent that they returned it to us, than they asked for it again we sent it again, than they said there was a problem with the title to the house a 2nd mortgage modification denied, we proved that there was no 2nd mortgage we were told to send the good faith payment again we did again it was denied, I don't think these people CHASE want to help anyone, The people that work in the Loan Modification department are so rude and uneducated in any form of mortgage knowledge, where is the help we where supposed to receive? Unreal!!!!!

I called and spoke with an individual at Mortgage Modification Legal Network and they were able to answer a lot of my questions. They work with attorneys and paralegals so they were really able to address my concerns I have. I would definitely recommend calling them.

I am a consultant and work for a number of loan modification companies. I have personally set up the entire procedures that my clients use today.

First, I have seen many examples of success.

Second, the good ones, the ONLY ones I would use, are owned by lawyers and staffed by ex-mortgage underwriters (there are a lot of ex-underwriters in the workforce since most of the old lenders are gone).

Third, you can do the entire process yourself without the assistance of one of these companies....but I would not recommend it because (a) you are way to emotionally fraught to deal with the red-tape of your lender correctly, (b) you don't know all the tricks and twists that can be used to apply pressure on the lender, (c) you have absolutely no experience in dealing with the lenders, and (d) you have absolutely no basis upon which to determine what is a good result versus a bad result.

Fourth, to get any decent service in this country, you will have to expect to PAY for it, just like you would expect to pay a doctor or plumber (and I wouldn't recommend trying to do either of those jobs myself either).

Fifth, everybody's case is different and needs to be handled differently.

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I have tried to get ahold of my mortgage co. for 3 wks!! All i get is more hold time and people that are very rude and don't care!! Has anyone heard of OceanView for a loan mod? I found a link on line and oceanview called me! so far they have talked to my mortgage co. and they are willing to do great things!! BUT oceanview wants 1200 dollars! I just want to make sure this place is credable and not one of the scammers!

The quick answer is yes, you can modify your own loan but the long answer is, yes, you can modify your own loan and you can also represent yourself in court but one must next ask, do you really want to?

A loan modification company can offer you four things which you probably don't have.

1) No emotional tie. Therefore, the bank saying, we are going to foreclose carries no weight.
2) Knowledge of process and precedent. A Loan mod company knows what the banks can and can't do.
3) Access to the decision maker. This is kind of like having a lawyer who can go into judges chambers. If you have ever tried to represent yourself in any legal action, you know you, as a pro se cannot get to chambers.
4) Time during the day. Should you try to do this yourself, you will find yourself spending a lot of time on hold and chasing down certain people and information - all during regular business hours.

Full disclosure here, I am with a loan mod company and we modify loans for a fee. We offer a money back guarentee and offer progressive payments..com[color=Red][/color]email removed.per TOS rules PM.[color=Red][/color]

I can only tell you my experience. I was behind on my notes, after hitting some medical expenses I was not expecting. Everyone told me I could go to my lender directly, and I tried that. The lender???s staff was insistent that I get current, and continued to threaten me with foreclosure. The only ???modification??? they would consider was an increase in my monthly payments, then a balloon payment way beyond what I could afford. When I told them I could not do it, they got hostile and started the threats again.

I didn???t really want to lose my home, but was getting nowhere on my own. Someone told me about loan modification companies, and when I started investigating them, the prices were all over the place, anywhere from a few hundred, to $3500.00.

The more I looked, the more I saw that they are pretty much like any other industry. There were good ones and bad ones. After much due diligence, I found one where the owners of the company had many years experience in the mortgage business and a good reputation in the industry. Their loss mitigation guy had been doing that for almost 20 years. Their fee was mid-range, but they did not want payment until they did an initial analysis to see if I were a good candidate. They also promised a 100% money back guarantee if they could not help me.

With so little luck on my own, I decided to use a professional. I could have gone it on my own, but to me, that was a little like representing myself in court. I could have gone for price only, but that is like using legal aid, when I could hire a good lawyer. When I ran the numbers, I figured out that I would recover their fee in a few months, and would save hundreds of thousands on interest over the years. It was a good return on investment.

I was really pleased with the end result. I did not have to pay the loan while they were negotiating. That alone was enough to cover the fee. In the end, my interest rate was reduced by 3 points, I got to start over without being behind, and I now have a fixed rate that I can live with.

Like most everybody, I had heard the horror stories about loan modification companies, but if you find a good one, it is worth paying for their expertise. I would have never gotten as good a result on my own.

If anyone needs to have there loan modified with free advice. You can email me at ***, I have been in the financial industry for over 20 years. And I have worked for some of the major companies such as Bank of America, Wells Fargo and Barnett Bank. I can tell you what to say or exactly how you can go about it.

I'm probably one of the few honest professionals out there that would give you the truth and not just to tell you what you want to hear. I'm not trying to solicit your business because I'm no longer in the business, I just want to help assist people in knowing the right thing to say or do.

*** - Personal info deleted as per TOS - Jason

I used a loan modification company, and was very pleased. The fees can run anywhere from a few hundred, up to a few thousand. The highest I found was $3500, but the one I used was $2000. It was worth what I spent for what I got.

These companies should get some kind of fee; after all they are doing work. However, people that need this service are struggling to pay their mortgage. Why does the fee have to be up front and/or one time payment verses monthly payments. ie if the fee is $1200, 12 monthly payments of $100 ???

I just received an email from the Loan Savers. Anyone here of them?

I have asc mortgage and the did a modification on my 1st but the will not budge on my second mortgage only a payment plan witch makes my payments higher and I can't afford higher payment. can anyone tell me what to do to get a loan mod for my second mortgage

the company i used was a company that i used for credit repair some 4 years ago. it was an easy process that saved me a significant amount a month off my mortgage. just use caution like you would with anything else.

I got a loan modification on my house it saved me about $1200 dollars a month! They reduced my interest and principle balance too. I went thru a company that did a great job! I would recommend them to anyone. They also have free seminars so that people can come and learn about what they do and what to look for in a good company, because there are a lot of companies out there that taking advantage of people.

I actually work for the company that helped me and as one of the other people said we are probally one of the few honest companies out there. If we can't help you we will tell you up front, we are not out to take peoples money if we can't do the job. One of the keys to getting a modification done correctly is through an attorney. ***

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I think that using a Loan Modification company makes sense due to the fact, that most owners are very emotional due to their circumstances and using a third party is worth what you pay. Most third parties are going to be able to speak on your behalf and get you a better deal because they are familiar with the system and no how to get to the right people.

The charges levied by Loan Modification companies are out of line. If they are charging a percent of the loan amount they are over charging.

Should be able to find a Loan Modification Company that is reasonable with fees.

Give me a call if you would like to learn more about having a professional mortgage loan modification. Count your blessings if you qualify. Loan modification can save you thousands of dollars each year. Call JEFF at 888-612-4069 Ext. 350 .
LOAN MODIFICATION CONSULTANT

There are loan modification companies out there who are legitimate. Some are scams. I currently work for a company that is presently working with several clients to have their home loans modified. We do professional, ethical work on our clients' behalf. We are Lodex Solutions call us at 404-652-0324 or 404-474-7991.

Loan Mod companies vary in fee. Many of the larger Mod companies (which most are former Mortgage Brokers converted into mod companies) have sales floors where predictive dialers solicit business by ringing numbers scrubbed against the 'do-not-call list'. Because there is no real regulation or limit to what can be charged these sales people will usually a minimum of $1,800. Most companies average around $2,200 per loan mod. I have spoken to people who have paid in excess of $4,000. It is important to beware of companies that negotiate the fee. If they are negotiating fee it probably means that you are talking to afore mentioned companies.

My company performs the loan mod for a $1,495 flat fee. We also add another layer of service - called a Forensic Loan Audit - that scrubs the loan docs signed for any inconsistencies in state and federal lending laws. An earlier post said that they are currently doing a loan mod and have found that their lender had done many things wrong. This sounds like a Forensic Loan Audit. The audit really gives the negotiation legs. How the different the negotiation would be if you simply asked the lender for help vs. asking for help and handing them a smoking gun with their fingerprints on it...

Most mod companies charge one month mortgage payment. I work for one of these companies. The problem is their are a lot of bad companies out there. They just take any one who wants to try to modify. There are guidelines for all the lenders. You may not qualify to modify your loan. One guideline most lenders have is you must be employed. If you decide to go with a mod company make sure they are willing to give you 100% refund if it does not go through. Read their contract carefully they will tell about a refund, but there contract states differently. You want someone confident that they can complete this for you. Wamu is a difficult company to get a modification done.
I hope this is informative and I wish you the best.

Again I ask: if you're having trouble paying your current mortgage, where is the money coming from for an upfront fee for a modification???

you have to come up with the advance money, which is why it wouldn't work for MOST people ... they are already struggling, so how can they come up with that extra money?

You can try Family and Community Financial Services. The even guarantee their services 100%. You are at least better off looking at your options. I do know that there are fees for the service but if they are going to save you hundreds of dollars per month it is definitely worth it.

just my opinion

the main factor is your surplus cash at the end of each month. "most" investors want to see that number in the positive. my "guess" would be somewhere in the $200.00 to $400.00 positive dollar range. just because your mortgage is with ex. American Servicing Corp, doesnt mean they make the decisions. They probably do what the investors they are working for tell them to do. a well written hardship letter would help as well. if i was trying to get one done i would have been glad i read this post.

I'm wondering if people are having any better luck with modifying their loans without the help of outside firms (i.e. working directly with your lender)?

Wells Fargo is continuously pushing me to give them personal income/expense information as well as filling out a modification application. I've continued to tell them I can't share that kind of personal information with them, and they get really upset with that answer. Then they say something like, we're making note that you are refusing modification assistance.

Anyway, this is why I was surprised to read the posts (albeit from mid to late 2008) that said they couldn't get through to their lenders or get responses on loan modification packages. Has this improved? Wells is really cramming this down on my despite the fact I won't provide them the information they are looking for.

My personal opinion is that they don't need any information from the borrower to modify a loan. A loan modification is simply a way to avoid a bad debt by the lender, just as much as it is a way for a homeowner to avoid foreclosure and negative credit reporting. If they are truely interested in avoiding a write-off, they should modify the loan even at a partial loss, without income/expense verification because they are attempting to avoid a full loss (less the value of a sale of the property). I'm sure it doesn't fit their "underwriting" standards, but it's better than having a non-performing loan on the books. In this market, it's better to modify a loan on faith rather than foreclose on a home where the property value could be underwater by $200k of the current loan balance (which is my situation).

The main reason they want that information is to see wether or not you can afford the home. What is the purpose of them modifying a loan if someone has no income? The end result is that they are not gonna be able to afford any payment. On the other side if someone can clearly afford the property and all they have to do is stop paying and ask for a modification, everyone would do it. The bottom line is if you signed a mortgage, you are obligated to fulfill it. Mortgage companies do not have to modify anything, but they do. So i guess if they are looking for your income and expenses and that is what their policiy is, Just give it to them.

I jumped through all of their (Wells Fargos) hoops, and was denied because they said I couldn't show that I had enough income to be able to pay for the modification ... I f&*$%&^&^ing don't have enough income BEFORE the modification! So how does that make any sense?? My loss of income was due to moving to a new state and a drastically different economy, NOT because I couldn't pay beforehand.

Guest - I think you are naive if you believe what you posted. Clearly I signed a mortgage and am obligated to it. And clearly the bank isn't obligated to modify it. In situations where a borrower does not abide by the loan agreement, such as non-payment, the mortgage lender can act upon their rights and remedies under the agreement -- including foreclosure. I do not deny any of that.

But you are being mis-lead if you think that a loan modification is about the homeowner/borrower. A modification is equally and moreso to the benefit of the mortgage provider. A homeowner, who is evicted and foreclosed upon maybe loses a little home equity (unlikely in this market), has some negative reporting on their credit, and moves into an apartment or rental. Not fun, but life goes on. The lender on the other hand has to pay a lot of fees and legal costs to foreclose, broker fees to try to sell it, eat the cost of of funds until it sells, and then likely sell at a pretty substantial loss of 30-50% in a lot of residential markets. Even more importantly, it affects a bank's capital reserves required by regulators because they have to book a huge reserve against the value of the mortgage. And this has a ripple affect on the bank, particularly in a situation where homeowners are defaulting by the thousands every day. This is why the government is putting billions of dollars into this institutions, not to "lend" out to others, but to simply prop up the balance sheet of these banks and improve their capital positions to keep them within government regulation, because the mortgage loss reserves are killing them (and because the monoline insurers are all about bankrupt).

But if they can modify the loan, get it current, and receive some positive cash flow from the asset, they can then remove the reserve from the balance sheet... which has a leveraging affect and has significant positive effect to their capital requirements.

Loan modifications are about the lenders, not the home owner.

So when they ask me my income information, I'm not providing it. If they want the home, they can act upon their rights and remedies. Otherwise they can choose to work with me under my conditions.

To be honest, I don't think I'm a good candidate for modification and I haven't really pursued it. I'm in a different boat than most people though. But it hasn't stopped Wells Fargo from pushing it on me every week and then getting testy when I decline to give them the information they want.

you are saying that THEY asked YOU if you wanted a Loan Modification? Why would they do that? Are you very late and close to foreclosure?

Yes, they do. Every time I talk to Wells Fargo Home Mortgage, and Wells Fargo Home Equity (the HELOC), the both try to get me to provide personal income/expense information, copies of my pay stubs and tax return, so that they can complete a loan modification.

I have never asked about a loan modification or indicated in any way that's what I am looking for. They initiate it, then get upset when I won't provide them with information. Then they tell me that they are documenting that I have declined modification assistance.

The last call they stated I was 65 days late. Probably 70 now, which is three payments (Dec, Jan, and Feb). I don't know how close to foreclosure this is, but I think they have hit the date whereby they can accelerate the loan. That's probably the first step towards a foreclosure.

Given how much they've tried to push me into a modification process, I figured that everyone would be getting the same treatment and that they'd be responsive to people looking for a modification.

Funny thing is, I have a 30yr fixed at 5.25%. So, I'm not sure what they have in mind for a modification. Frankly, the payment on this home is not the issue. It's that the home has a serious, significant water problem and it floods during the rainy season. I've spent about $125-150k to try to fix it and am in litigation with the neighbor where the source of water comes from. Neighbor will not give me access to the property to perform the fix, and all my engineers and contractors say the fix has to be performed on my neighbor's property (can't be done on mine... $125k later, thanks guys). Until it's fixed, which has to be ordered through the court system, I will not make another payment on the home. It's worth nothing to me if it isn't inhabitable. And I don't expect that Wells Fargo will get much more than nothing if they foreclose and sell it. They probably see the writing on the wall and know I'm right that they're looking at a $200k loss if they foreclose, which is why they want me to modify the loan and start making payments again. Otherwise, I'm not sure why they are giving me such a hard time about a modification that I haven't asked for.

I have contacted a load Modification complany called United Housing Relief. Anyone heard of them? They are charging about 2K for the service up front but will refund if they were not able to obtain the modification. Though I think I want to try the process but a bit skeptical about whether or not the company is legitimate.... Can someone offer some opinions?

I've never heard of them, but I know I'm starting to get a lot of stuff in the mail advertising loan modification companies. Really it started in the last week or so... getting one or two "postcard" mailers each day.

Somehow I made someone's mailing list I guess...

loan modification is not a myth. but beware there are aton of them that take money up front and give false hope. It is acomplicated task wich you nearly have to be a ecanomics graduate to do on your own. mitagating a loan mod. is like chineese arithmatic.(I tried it) I ended up using a co. out of florida called Realestate loan negotiation services inc.(rlnservices.com) they where very prfesional and DID NOT ask for any money until i was aproved through my linder for the modification. they where not able to get my princapal amount lowered (some loans they can) but they did get my interest rate lowered AND FIXED.... and got my payment lowered they chaged me one loan payment (1240.00) for their services. I promised my modification proseser that i would post this..SO..
jeff gordon @ (rlnservices) here is your pat on the back
THANK YOU for saving my home Amy kretch delrio ten.

I believe the theory behind using a loan modification company versus doing it yourself is:

1. Avoiding the hassle of "endless" hours on the phone, either for applicaton purposes, or just trying to reach a person at your lender who can process/approve the modification.
2. Knowing what is a "good" modification versus what is just a token offer by the lender which is not nearly as much as they should be modifiying (i.e. the modification company does this all day, so they see good modificaton offers and bad --- an individual only sees the one modification offer they get from the lender with no reference points).
3. They do this professionally and can push the process through much more quickly.

Maybe there are some other reasons.

But certainly there are people who can do it on there own and get good results too, plus save the fees paid to a modification company. Just like there are people who change their own oil and people who pay a mechanic to do it. To each their own.

akretch learn to spell then maybe ill call you

Loan Modifications is of various types. Lv me a messsage. I can try to help u fr free

It is true SOME loan mods. can be done your self IF you have the time and extensive knowledge. Most lenders do not want to have to educate you and help you at the same time also you could end up speeding up the forecloseure of your home if you give them the wrong info. there are certain guidelines you have to fall into to "qualify" for a loan mod. it is arduous and risky to try it on your own....if you work in a bakery are you going to rewire your house and then sleep comfortably in it shure it wont burn down??? eventualy doit your self loan modification is going to cost every one because the lenders are going to hire people to do nothing but that for them...who do you think is going to have to pay those paychecks!!??????

AKretch was writing about her experiences as a customer of someone who does loan modifications ... she herself is NOT someone who does loan modifications. So her mispelling should not be a reflection of the loan mod in question.

You might want to have your readers check out modfraud.org. This company provides a service to help victims of loan modification scams get their money back! They also have pre-screened services to help customers get matched with a company that is legit. They helped me get $5300 back from a company that was giving me the runaround. Hope they can help someone else! Thanks!

Speaking from experience I know of one really good company that takes care of business and they average about 40% in reductions on the monthly payment. Plus if for any reason you don't like the results they have in writting a 100% money back guarantee. I would suggest asking for a Guarantee in writting and make sure it has a minimum decrease amount. Some companies like to say they "guarantee" a reduction and then have something stupid like a 5$ a month drop in payment and take your money anyways. Don't fall for that!!

Send me an email and I can get you information as to who to contact email deleted..PM

Oh yeah... and you don't even need to be late to do these.. .just need to prove there is some sort of hardship. So that's pretty cool too..[color=Red][/color][color=Red][/color]

do not post your personal email.

Before you pay to have this done try this, i bet you it may work

1. position your excess monthly cash to be around 200.00 to 500.00 dollars positive
(take your income, subtract your expenses)
if you are not paying credit cards dont use them (they can see your not paying "credit report" and wont use them as an expense
if you show them that it is negative, you probably cant afford to be in you house
if you show them to much, you will probably get a repayment plan

2. write a good hardship letter

3. make sure you stay in touch with your lender at least once a week to make sure things are going ok.

most investors want to see your "cashflow" like this, some will only use a portion of your monthly income, so if that doesnt work try it using only 80% of your income. they leave you 20% for incidentals

You dont need to be an attorney, you dont need to be a mortgage broker or a real estate agent. You just need to know what they are looking for and have a little time and patience. The average process usually takes 30-90 days, so just stay in touch and make sure you get them everything they need. Remember not all investors will modify a loan, and anyone who "guarentees" you something is lying. NO ONE will know the new terms until the entire process is complete. The Investor will be the one to set the new terms, not a loan modification company,

Good Luck All

that looks like good advice that might work for the do-it-youselfers on the forum! Thank you!

i post on other forums, but just noticed this one. here is my take on loan modification companies - beware!!! they are scams. anyone who takes your money upfront and insists on that as a stipulation to do business for you, is a ripoff.
there are non-profit agencies all over this country that will step in for you and work with you (urban league, for example) to obtain a modification or some remediation with your lender. you can check and find out who these agencies are by checking the hud.gov website. hud is, of course, Housing & Urban Development. this is a governmental agency, so decidedly an agency with which you can have a comfort level in your dealings and know that you can be confident they'll work on your behalf.
please, please do not spend your money so that others can get rich over your discomfort.

i just posted a diatribe against the modification companies, and i neglected to mention that i am a loan officer with a national mortgage company. i have no interest in doing anything other than helping the folk who are in a desperate situation and who are being taken advantage of.
forgive me for not identifying my profession.

i post on other forums, but just noticed this one. here is my take on loan modification companies - beware!!! they are scams. anyone who takes your money upfront and insists on that as a stipulation to do business for you, is a ripoff.
there are non-profit agencies all over this country that will step in for you and work with you (urban league, for example) to obtain a modification or some remediation with your lender. you can check and find out who these agencies are by checking the hud.gov website. hud is, of course, Housing & Urban Development. this is a governmental agency, so decidedly an agency with which you can have a comfort level in your dealings and know that you can be confident they'll work on your behalf.
please, please do not spend your money so that others can get rich over your discomfort.

oops...my diatribe is below my apology; oh well...please be careful people!

I am a loan modification processer.and work all day with people who say"I tried to do my own loan mod now i have a sale date" you CAN do your own loan mod but if you give them the wrong info or to much info you could put your foreclosure in over drive. or if you dont get the papper work to them in time. i do this all day long for any where from 900.00 to1200.00 depending on the circumstances. NO upfront fees i get your mod approved before you have to pay me..There are a ton of crooks out there.NOT ALL OF US ARE!!
not every one has the time to do their own loan mod if you are faceing a hardship in your life more often than not that very hardship will also keep you from being on the phone 3 to 5 times a week for 30 or more mins. at a time each..and further more how do you know that the deal that they are offering is the best they will do??..whats your basis to judge that..??????? if you can doit your self more power and good luck to ya..if you want some solid help you can e-mail or call me....(904)214-6027.... [email]jgordon@relnservices.com[/email]

I tried the free gov't agency approach and they had a 90 day (plus) waiting list - I would lose my house by then. I then called one of the scam 3rd party loan mod companies and they wanted $1,200 UP FRONT and another $1,200 when they finished - if they finished. I decided to use a do-it-yourself mod company that gives UNLIMITED support! Every question I have - I send them an email and they respond within 24 hours! I highly recommed them - lossmitconsulting.com - they charge a fraction of the price of 3rd party mod companies. Yes I have to do the work myself, but if i could afford to pay $2,400 i wouldnt be in this situation! i am almost done with my mod and these guys have been great!

How do you guys expect to get paid by charging people who aren't making their house payment or credit card payments (often) if you don't charge upfront? You can't hold up the loan mod -- often the servicer will send the modification agreement to the borrower directly. You have no security, less than a credit card. You'll have to then become a debt collector as well. I could literally sign 80 percent of qualified candidates if I offered a 'pay after' option, and 95% if I told them they could keep making payments (our contract actually says we can't legally advise them of that, which I think is legal chickenshit). If the borrower is making payments while in negotiation, he is harming his chances and unless the loss mit agent is retarded, he will smell that a mile away. You can't claim hardship and claim you can't make those original payments and then actually continue to make them, unless you have a helluva excuse.

Anyway, what type of clients do you look for? What results are you seeing? Any loan modification examples? I wouldn't mind checking out what some other companies are getting their clients, especially since we seem to charge so much more than everyone. I hope our results are at least justify those prices. From what I'm seeing, saving someone 100K to 300K over 30 years is damn cheap if it only costs $5995! Where else can you pay that little and get that much back? And with a downside of only $1295 (I think failure to mod is a bigger downside though). I can't verify but I'm told we're well past a success rate of 90%, though that really only means modifications offered. That does not guarantee that the borrower will like or accept the mod, though we haven't had one declined yet. I'll find out more as I get more into it. I've only been selling these mods for a short while, though I've done some modifications (short pays) while doing reverse mortgages, and I can tell it will be so much easier to get these modifications done than the ones I managed to get done before (homes with equity and borrowers that would not pay late) are a difficult mix when asking a lender to reduce principal and convince him that your borrower is struggling.