Clearing HAMP Mortgage Modification Hurdles

by Claire in Fairfield, CA, by Pamela in Millstadt, IL, by Craig in Santa Clarita, CA

Ask Kate how to clear HAMP mortgage modification hurdles: Claire cannot afford her house payment this month, following a divorce. She's checked with the Freddie Mac website and thinks she's qualified to modify her mortgage. What is her first step?

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Pamela converted her rental home to a daycare. Will her lender be willing to modify the existing mortgage terms? Craig asks where he can get a HAMP Tier 2 loan modification for no money out of pocket. Can he shop for the best deal and choose any lender for his modification?

HAMP Modification and Divorce

By Claire from Fairfield, California
HAMP Modification and Divorce

Hello,

I am at the end of my divorce but 3 months from final court date. My husband moved out in July and I am finally able to enjoy peace in my home after 7 years without.

I receive spousal and child support in the amount of $8,000. My mortgage payment is $4,000.

I have many things I am trying to catch up on paying so that leaves me without funds and this month I don't think I will be able to make my payment.

Nationstar is my Freddie Mac loan servisor and want to use HAMP modification program.

Do you feel Nationstar will work with me? I qualify according to Freddie Mac site's qualification questions and Nationstar is on their bank servisor list. If you could advise me I would be grateful. Thank you. Claire

***zz-portrait-left.shtml*** Ask Kate answers: HAMP Modification and Divorce

Hi Claire,

It's very important to call your loan servicer immediately if you cannot afford to make the house payment this month.

I'm happy to hear that you found Nationstar on Freddie Mac's list of participating lenders. When you call them regarding your inability to make this month's house payment, also ask to get the loan modification paperwork rolling.

Hopefully, you'll find that your lender is decent to work with. You can help move the process along by supplying the initial paperwork and keeping the lines of communication open. Return their calls and send them additionally requested paperwork in a timely fashion. Here is a list of common documents that lenders require.

Something you may not have considered... If your ex-husband's name is still on the mortgage paperwork, ask your lender if they will require his signature before modifying your mortgage.
Go to Solving Your HAMP Loan Modification Predicaments to read about challenges other divorced homeowners have encountered.
Best wishes,

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How Does Hamp Tier 2 Define Rental Property

By Pamela H. from Millstadt, Illinois
How Does Hamp Tier 2 Define Rental Property

Kate,

I am seeking help on a 2nd property that I own next door to my home. My home, after a nightmare of experiences received a HAMP over a year ago... The 2nd property houses a M-F 6am-6pm daycare/preschool center, my plan to overcome financial hardship after my husband's stroke and job loss several years ago.

After 10 account managers, HAMP applications were sent to me along with updated documents requests over and over for almost 4 years.

Now I was just offered a Capitalization loan for twice as much as I was paying before the hardship. The reason stated as to why I didn't qualify for the HAMP Tier ll was because I didn't live in the house as my primary residence. Proof requested was a copy of current electric bill. 3 months ago I was told I didn't qualify because the home was vacant and they needed a current electric bill to prove otherwise.

I have always told the bank the daycare was in this house. They are the ones who sent me the application for HAMP. But they give me reasons I'm not accepted that don't make sense in light of a 2nd and even a 3rd property being eligible.

I'm wondering if it's because the daycare is the renter and this is not acceptable. If so, why don't they just say that instead of giving me reasons that don't make sense so we go through it all again and they come up with another reason that doesn't make sense.So, is the HAMP Tier ll that allows for up to 3 HAMPS for rental properties only allowed when a person or family is renting from the owner or can programs such as mine be considered the renter??? We have a special use permit from the County to have this daycare at this location. Thank You so much!

***zz-portrait-left.shtml*** Ask Kate answers: How Does Hamp Tier 2 Define Rental Property

Hi Pamela,

In the early days of the Making Home Affordable Program, the only properties eligible for HAMP loan modifications were owner-occupied homes.

Eventually, the program under the tier 2 guidelines opened up HAMP to houses that were currently being rented.

So it would not be illogical to assume that your rental home would be eligible. But, as you suspect, I also believe the fly in the ointment is that your rental, although residential property, is being used for commercial purposes.

The sad part is that your loan servicer did not make this clear to you when you applied for a home loan modification. (If it is of any comfort to you, you are not alone. See Repercussions in Hardship Loan Modification Process.)

My suggestion is to call a Making Home Affordable Housing Expert and enlist their help in getting an explanation from your lender. They may also be able to look into your case further to see if there are lesser-known guidelines regarding a residential mortgage modification on a home being used for daycare. By the way, there is no charge to call them.
Go here for the phone number and more information... Free Making Home Affordable Housing Counselors.
Best wishes,

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Where Do Homeowners Get HAMP Tier 2 Modifications

By Craig from Santa Clarita, California
HAMP Tier 2

Kate,

Where can I get a HAMP Tier 2 loan modification for no money out of pocket?

Thanks so much in advance!!


***zz-portrait-left.shtml*** Ask Kate answers: HAMP Tier 2

Hi Craig,

Mortgage loan modifications are available only through your current loan servicer. Unfortunately, there are no options to shop other lenders' rates or terms.

Some lenders, especially the larger banks, modify loan terms under their own programs, in-house modifications. Or, if your loan servicer participates in the Making Home Affordable Program, you may be eligible for a HAMP Tier 2 Modification.

But be careful not to fall for scams run by third-party companies asking for large sums of money, promising to handle your modification process on your behalf. In truth, they have no more direct contact to your lender than you.

Instead, initiate a call to your lender and save yourself a bundle of money.
Go here to understand why you should not pay a third-party for a mortgage modification... Beware of HAMP Hardship Loan Modification Scams.
Best wishes,

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I Owe $6000
by: Elane

I applied for a modification and approved for a HAMP. After making 2 payments, I was informed by phone that I had already received it and was not allowed to make any more payments unless it was for the past due which is about $6000.

They are now reviewing my account for additional modifications thru Fannie Mae. Any hope for me?

Hi Elane, Kate here...

If a couple of weeks pass without a satisfactory response from your lender, call a Making Home Affordable (MHA) housing expert and ask for help.

Go to Free MHA Housing Counselors for details.

Best wishes, Kate

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