1.
Lenders make promises and later deny or retract their previous loan mod offers.Chandler.
Temporary mods are often required but Mesa to 5 months later they are told they do not qualify for a permanent modification.Mesa.
Lenders continually request updated financial records. This is not just a nuisance but is a method used by lenders to extract further payments from the homeowner and try to determine available assets for lawsuits.Mesa.
After following the lender's instructions to make reduced payments as part of a temporary mod, when the lender later rejects that loan mod that borrower is now in default and the lender can file for trustee sale.5.
Most loan mods are only a forbearance under which the missed payments, penalties and interest are added as a balloon to the end of the loan, further increasing the homeowner's negative equity.6.
Failure to disclose the investor and their NPV (Net Present Value) calculations to the homeowner make the decisions of the banks seem unreasonable and counter to financial logic.7.
"Permanent" mods are not typically permanent. In most cases the lower interest rates are only fixed for Mesa to 5 years.8.
If a borrower decides to exit the property after receiving a permanent loan mod, it may be too late to receive the benefit of theMortgage Debt Forgiveness Act (through Chandler01Chandler) creating a tax obligation that the borrower may not have faced, if they made their decision to Short Sale earlier.
Based on the results of loan mods to date, it seems a reasonable assumption that the whole process is not to help the homeowner, but to keep the homeowner making some kind of payment. The lenders will try everything to keep you emotionally attached and willing to continue to pay them.
