Being Prepared for Interview with Attorney or Consultant for Loss Mitigation Matters

Roberto Rivera Uncategorized

  1. Determine who is the investor on your note. Determining the investor of your loan is one of the most important things in the process. The investor sets the guidelines for loss mitigation (Modification, Short Sale, Partial Claims, Forbearance Plans etc), who and how to be eligible, and many have published guidelines.
    1. Call your servicer and ask them. Some servicers will give you the information, however some will not.
    2. Go to the Fannie Mae look up tool and the instructions. This will tell you if Fannie Mae is the investor.
    3. Go to the Freddie Mac look up tool andfollow the instructions. This will tell you if Freddie Mac is the investor.
    4. However, the best way to determine the owner of your note is by finding your Mortgage. This is a 13 – 15 page document you received at closing. The mortgage, if registered with MERS, will have an 18-digit number on the first page. It is called the Mortgage Identification Number (MIN). Again, it should be on the first page of mortgage and will look like this “MIN 123456789101113141”. Once you have this number go to the MERS Servicer ID and follow the instructions.
    5. If you do not have the MIN you can also do searches based on property address and social security number. However, if you use the social security and property address be extra careful to make sure you identify the note by the date on the note as well. In other words, make sure you know the exact date you signed the note, because MERS may illustrate various notes you had in the past.
  2. Determine property value. Many loss mitigation programs have property valuations guidelines. This is a significant factor is the process as well, and it is impossible to determine exactly what value the servicer will come up with. But we must have an idea of value to set realistic expectations and determine if there is a potential for denial due to excessive forbearance. When visiting these sites take special notice of when comparable sales occured. Take notice of the size of the property as well, jump in your car and take a look at the comparable sales so you can estimate how much your property is worth. This is no substitue for broker price opinion or an appraisal, however in my opinion at this point neither is necessary if you take your time and follow these directions. If you do not have the time then call a local realtor or simply pick up the phone and hire an appraiser. If hiring an appraiser, I would recommend one that is FHA certified.
    1. Call your servicer and ask them. Some servicers will give you this information however some will not.
    2. Ask a realtor or use any popular AVM, like Zillow or Realtor.com.
  3. Find your closing documents. Make sure they are the documents you had when you last completed a refinance or when you purchased the home whichever occurred last.
    1. Find HUD statement.
    2. Find Note and any additional Riders
    3. Find Pre-Payment Penalty Clause
    4. Find Truth in Lending Statement
    5. Find Mortgage
  4. Find Mortgage Statement.
    1. If taxes and insurance are not included with the mortgage be sure to verify amounts.
  5. Income
    1. 1 month worth of pay-stubs (For all adults in home that contribute income towards home)
    2. If self employed, last three bank statements (personal and business, and if contributor is self employed their last three bank statements)
    3. Tax Returns for last two years filed (contributors as well)
    4. If receiving social security, or pension, provide verification of such income.
    5. List of rental income.
    6. A note on income: it is important to disclose all income received even if you can not document it at the moment, so please make sure to disclose.
  6. Make a list of all credit obligations.
    1. Credit Card Balance and Minimum Payment per statement
    2. Car Loan’s Balance and payment
    3. Any other installment loans you maybe make balance and payment
    4. If you have ever been sued or have accounts in collections please disclose. If you are not sure, we recommend that you get a copy of your credit report.
  7. Make a list of your household expenses. Food, Utilities, Cable, Home Phone, Internet, Cell Phone, Gas for vehicle, Insurance for vehicle etc.
  8. Take a few minutes and answer the questions below.
    1. Borrower (s):
    2. Current Loan is a Refinance or Purchase?
    3. Why did you refinance?
    4. Do you own any other properties?
    5. Are there any non borrowers who contribute income to household?
    6. Did you get your loan from a broker or from a bank directly?
    7. Where you told one rate or term and then at closing it was different?
    8. Property Type: 1 , 2, 3 or 4 Family
    9. When did hardship occur?
    10. Is hardship permanent?
    11. Have you resolved hardship and how?
    12. Can you document hardship?
    13. Have you applied for a modification? Y or N
    14. Do you have an active application with servicer? Y or N
    15. Did you retain a company or attorney to represent you? Y or N
    16. When was the last time you submitted bank statements and pay-stubs to lender?
    17. Have you ever been granted a modification and then re-defaulted? Y or N
    18. If granted a modification previously do you have a copy of it? Y or N
  9. Once you have all this information you are ready to have a professional analysis of your file completed. Some Law Firms and Loan Modification Consultants offer this service from $500 – $1500. Of course you can go to the government’s website at www.makinghomeaffordable.gov and use their tools. However using a Law Firm or reputable Loan Modfication Consultant is invaluable. They will know up-to-date trends and new programs that may not be published or well circulated. However, be very careful when selecting. If at initial consult, or shortly after, a complete interview has not been completed with the data above addressed and discussed, RUN RUN RUN!
  10. Remember “help” is available for free from NON Profit HUD Counselors. Unfortunately in my opinion they are not very effective. Most simply gather your documents and send it to the lender and provide little or no technical guidance. If you decide to submit an application on your own, I would suggest using DMM Portal (www.dclmwp.com); for a small fee of approximately $150 they will upload your documents in a portal system that lenders will have full access to. And be prepared to wait. With the back log servicers have you will be in review 4- 9 months. Not to worry, with DMM it is very manageable. Every month you simply upload your pay-stubs, and bank statements and it only takes a couple minutes.