Solving Your HAMP Loan Modification Predicament
by Sonia in Plainfield, IL, by Eric, and by Shelba in Orting, WA
Ask Kate about HAMP loan modification before divorce and other predicaments: Sonia wonders what she should know before modifying her mortgage since she's in the middle of a divorce. Eric asks who he can contact after his lender raised his permanent payment following the trial HAMP period. Shelba wants to know if she can still modify her mortgage should her husband lose his job after their FHA streamline refinance.
Divorce and HAMP Loan Modification Guidelines By Sonia in Plainfield, IL
My husband and I are currently in the middle of divorce proceedings.
He is willing to move out and sign a Quit Claim Deed. The home is 3 months behind on the mortgage.
Would I be able to save my home and file for a HAMP on my own? Are there any guidelines that HAMP has that are specific to modification during divorce?
Ask Kate answers: Divorce and HAMP Loan Modification Guidelines
Super good questions! To answer you, I am going to quote Making Home Affordable HAMP guidelines specific to divorce.
Question: If one of the borrowers on the loan is non-responsive (will not supply income documentation and will not sign a Home Affordable Modification Agreement), can the HAMP modification proceed with the remaining borrower who is residing in the household, as long as the HAMP modification does not have to be recorded?
Answer: Unless a borrower or co-borrower is deceased or a borrower and a co-borrower are divorced, all parties who signed the original loan documents or their duly authorized representative(s) must execute the HAMP documents. If a borrower and a co-borrower are divorced and the property has been transferred to one spouse in the divorce decree, the spouse who no longer has an interest in the property is not required to execute the HAMP documents. Servicers may evaluate requests on a case-by-case basis when the borrower is unable to sign due to circumstances such as mental incapacity, military deployment, etc.
But don't let guidelines keep you from applying for HAMP just because your divorce isn't final. I urge you to call your loan servicer to discuss your situation, especially since your mortgage payments are 3 months behind.
You can find more help regarding HAMP and divorce issues at these Ask Kate letters:
Mortgage Rate Increases During HAMP Modification By Eric
Hi Kate, I hope you can help me.
I was offered a HAMP modification this past spring from Wells Fargo (Freddie Mac). I was offered verbally a final rate of 3.5% and I accepted.
I made all three of my trial payments on time and at least one payment since at the same amount.
They FINALLY sent my lawyer some final paperwork and NOW the final rate is 4.375%. Do I have any recourse?
This seems entirely unfair and shady considering I accepted their offered and fulfilled all of my requirement in a timely fashion. Eric
Ask Kate answers: Mortgage Rate Increases During HAMP Modification
I agree! Why bother seeing if you can make monthly payments during the trial period when the loan servicer is going to squeeze a higher mortgage payment out of you in the final modification!
It's a shady practice and reeks of manipulation.
Make a stink! It will take elbow grease on your part and the process will probably be frustrating. It might even require writing Washington DC
. But I for one would love to see you become the national poster child for Fairness in Mortgage Modification.
For sure, write the Attorney General for your home state and file a complaint with the Consumer Financial Protection Bureau (CFPB). You can both file the complaint and find your attorney general contact information at Consumer Financial Protection Bureau: Report My Loan Issue
Best wishes for a fair outcome,
Modifying with HAMP Following FHA Streamline Refinance By Shelba in Orting, WA
We are considering a FHA Streamline refi. Our credit is pretty bad but have always been current on house payments.
My husbands job is not as secure as it once was, he will soon be 62.
If we do the FHA streamline refinance and his job situation changes, can we still do the HAMP? We are not Freddie or Fannie, just straight FHA.
Right now we are just over the income to qualify for HAMP but that could quickly change.
We have a 6% fixed, purchased the home in December of 2005. We have no second mortgage but we do have a line of credit with a balance of $15,000.
Thank you for any help you can offer. Shelba
Ask Kate answers: Modifying with HAMP Following FHA Streamline Refinance
There is actually a Making Home Affordable modification program (HAMP) specifically for loans insured or guaranteed by the Federal Housing Administration (FHA).
A big concern is that your FHA streamline refinance is going to be originated after HAMP's cut-off date for obtaining a mortgage - on or before January 1, 2009.
I would verify if this cut-off date is going to impact your eligibility for a HAMP modification by calling FHA's National Servicing Center at 877-622-8525 or a HUD-approved housing counselor
at 888-995-HOPE (4673).
Best wishes for getting an affordable payment,
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