financialcounselor

Posts Tagged ‘mortgage company’

Beware Loan Modification Scams

In Uncategorized on June 14, 2012 at 11:32 pm

LEGITIMATE SOUNDING COMPANIES AND ACTUAL LAW FIRMS ARE SCAMMING PEOPLE DESPERATE TO QUALIFY FOR A LOAN MODIFICATION

 

In case you’ve been living on Jupiter for the past four years, a lot of people in America have been losing their homes to foreclosure. And the government has trotted out a bunch of programs to help people save their home. If you’ve read much of this blog of mine, you know that a lot of the stories I write about are the nightmares that people go through trying to qualify for these government programs.
Well, a whole cottage industry of scams has sprung up because of this foreclosure mess. A whole array of degenerate con artists is out there preying on people desperate to get accepted into the government’s housing assistance programs. And I talk to people all the time who’ve handed over their hard-earned money to these creeps who make people believe that they can make that happen.
So, if you have applied for a mortgage-assistance program through your mortgage company, or if  you’re thinking about doing so, please, for the love of God, remember this one thing: Nobody can influence the mortgage company’s decision about whether or not to help you, no matter how much you pay them.
Now let me give a run down on how these scams work. A lot of them are operated by lawyers and law firms. Big surprise there, right? Others are operated by “loan modification companies,” or “loan modification experts.” Here’s their basic hook: They tell people that because they are lawyers, or because they are experts, they can negotiate with the mortgage company. Sometimes they’ll promise to get a house payment lowered, or sometimes they’ll just say, “Hey, you know you can’t afford your mortgage, so what have you got to lose by hiring us?”
I’ll tell you what the homeowner loses every time–the hundreds or the thousands of dollars these bums charge.
See, here’s why these lawyers and experts can’t help. The mortgage company works for the entity that owns the mortgage. That entity is called the mortgage investor. The mortgage debt is owed to the investor, and it’s the investor who tells the mortgage company the criteria for putting homeowners into these housing programs. The mortgage company doesn’t just pick people’s names out of a hat like they’re raffling off Christmas turkeys. I mean, we’re talking about hundreds of thousands of dollars at stake here.
But because the application process to get help can be such a nightmare, many homeowners feel powerless and desperate. And it’s that desperation the con artists prey on. A lot of these vultures will run very legitimate-looking advertisements. Still others solicit to homeowners directly. However you might run across them, just remember, if all it takes to save your house is a few hundred or a few thousand bucks, then why are the foreclosure rates the highest they’ve been since the Great Depression?

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Denied a Loan Modification? Don’t Assume the Reason will Make Sense

In Uncategorized on April 27, 2012 at 9:27 pm

One point I’ve tried to hammer home with this blog is that when it comes to applying to your mortgage company for inclusion in one of the government housing programs, such as their loan modification program, your request can be turned down for any number of reasons. And the most important thing to realize is that the reason does not have to make any sense to you whatsoever. I talk to people all the time who are denied loan modifications for reasons that are beyond anything a Hollywood writer could dream up.
Let me give you an example. A man named John told me that he was denied a loan modification because of the assets he owned. Now I’ve had a lot of clients get turned away by their mortgage company due to their assets, but here’s the thing that had John ready to blow a gasket: his assets consisted of one retirement fund that had a market value of $4,900. That was it.
I thought John was going to say he owned some valuable real estate or big-money stock investments or something. But nope, he had one measly IRA worth less than five grand. And John wasn’t over retirement age, so if he liquidated his IRA, he would have to pay a ton in penalties, not to mention the standard taxes. He’d be lucky if he was left with half what the thing was worth. And I’ve got to assume that a major financial institution is aware of the rules concerning retirement funds. So essentially, John’s mortgage company was saying “Hey, if you want help, then you cannot own anything worth anything.” I hoped they wouldn’t also make him sell his car.
I suggested we call the mortgage company to make sure they had the correct information. And we were told by the nice lady who kept mispronouncing John’s last name that there was no mistake, the modification was denied because of his $4,900 retirement fund.

Do you know who you work for? Aurora Loan Servicing doesn’t

In Housing Horror Stories on August 26, 2010 at 8:20 pm

Customer service rep swears they have no idea who owns their borrower’s loan

  If someone asked you who you work for, can you imagine their reaction if you told them you didn’t know? They’d probably think you were a spy or something.
  Apparently, Aurora Loan Servicing literally doesn’t know who they work for. The function of a mortgage servicing company like Aurora is to collect mortgage payments from homeowners for the investor to whom the mortgage debt is actually owed. And the servicer gets a fee for performing this function.
  Today I tried to facilitate some kind of workout option between Aurora and a borrower who was in default on his mortgage, due to being laid off from work for four months. Unfortunately, we didn’t have any luck, though we did have a remarkable conversation.
  The representative who answered our phone call told us that there was something about this particular mortgage that precluded it from any kind of repayment plan or workout agreement.
  We asked what it was about the mortgage, or what the investor’s guidelines were. She said she did not know. That was when the borrower asked who the investor of his mortgage was. That was when it got weird.
  “We don’t know who owns it,” the representative said.
  “Wait a second. How can you not know who owns this mortgage?” I asked. “You just collect this man’s payment and you give it to the owner of the debt. You work for the owner of this debt. Are you telling me you don’t know who you work for and who you give his money to?”
  “We don’t know who owns it,” she repeated.
  “Look, if you’re not authorized to disclose the owner of the mortgage, that’s fine, just say it. But you have to know who you’re collecting money for.”
  “We don’t know who owns it,” she repeated for about the fifth time.