I have been involved in a mortgage modification nightmare that started in October 2009 and just recently came to an end (ending badly for me, unfortunately) in March 2011. I heard about the Making Home Affordable modification program, and it sounded like a solution for my family when in 2009 my income as a realtor was significantly reduced. I called my lender, PHH Mortgage (based in New Jersey) and inquired about the program and was told that, based on my information verbally given to them about my income and debts, I appeared to meet the criteria and was told that my new \”temporary\” payment would be overnighted to me in a letter, along with forms and application to complete. When the envelope came the next day, the letter enclosed said that my new payment amount would be an amount equal to $900 less than my regular payment, and that it would begin with the next payment due, which was the October 2009 payment. I completed all the paperwork requested, mailed the documents back, and made the new payment amount. When I called to inquire about how long the process would take, I was told it would take about 4 months to process my application.
Four months later, they wanted additional information (basically wanted me to update my P&L for my real estate business). I called regularly to see what was going on, and each time was told that it was being processed, and that I should continue making the temporary payment amount. I made every payment each month, and they dragged the process out for a whopping 18 months. During the modification processing, I had to call in to make my payment over the phone. So imagine my surprise when I called in to make my February payment in 2011 and was told that they could not take my payment unless I could pay the entire delinquent amount…$18,000. I was also told that a letter of intent to foreclose had been mailed to me already.
I was not even delinquent when I entered this process. And I made every payment they required every month of me, in the amount THEY TOLD ME TO PAY. How can they say I defaulted?
To add insult to injury, I was finally, after probably a hundred calls, able to get in touch with the actual person at PHH Mortgage who submitted my application and found out that she submitted the wrong info on my income. We have a farm, and our tax returns show income from the farm, although not much, just basically enough to keep our farm use tax status for the farm. It came to about $500 per month. Each time they had asked me for updates to my income, they wanted my real estate business P&L and my farm P&L. This idiot at PHH Mortgage only submitted my farm P&L to Fannie Mae for the modification request. I was furious! Especially after having updated my real estate income at least 4 times during this 18 month period — so I KNOW they had it in their file! They had to have had a file on me 3 inches thick. She told me she just took \”the most recent income P&L that she saw…I guess the one that was on the top! When I demanded that she fix her mistake, she told me there was nothing she could do that the foreclosure letter had already been mailed, I had already been denied by Fannie Mae, and my only choice to avoid foreclosure was to pay the $18,000 and re-apply. By this time, my next payment was due so they actually wanted $21,000 to avoid foreclosure. She directed me back to the collection department, who said I had until March 11th to come up with the money.
I didn\’t want to lose my home, so I borrowed the money from my parents and paid enough ($11,000) to delay everything, then added the balance to my next few payments, which bought me some time to sell personal property and get the difference. So I managed to keep my home, but I know there have got to be many, many people out there who have had the same experience and were not able to come up with the \”back\” payments within 30 days and have lost their homes. In my opinion, this is extremely unfair to the borrower. How can it be allowed to happen this way? And now I am back in the situation of struggling each month to come up with my payment on my much reduced income, but I don\’t trust them to handle it correctly this time either.
Something has to be done to protect people from the \”ambushing\” by the mortgage holders who are getting compensated by the government to process these modifications. I know that they had to have had a reason for delaying mine so long…my guess is that they wanted to milk the government for all they could. When they thought they couldn\’t get any more, they finally submitted my application, not caring whether or not it was sent in correctly, and shrugged their shoulders when they messed up and almost cost me to lose my home and my sanity. Doesn\’t this violate some kind of anti-trust laws or something? Fair lending practice? What can I do?
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