Bank Loan Modification, Bank Loan Modifications, Banks

If you have a Wachovia Bank home loan that has become a burden, the recent take over by Citibank may have a beneficial impact on your chances for a loan modification. Citibank is under pressure to quickly straighten out the mess caused by the billions of dollars of bad loans issued by Wachovia Bank. The quickest and most cost effective way to turn these delinquent loans into performing assets is by offering their existing home loan borrowers a loan modification to convert their bad loans into affordable, low interest rate loans with affordable monthly payments. This is a win-win, the homeowners avoid foreclosure and the bank looks great on paper.

Many borrowers currently are saddled with toxic "negative amortization" loans that were issued routinely by Wachovia. These loans feature high interest rates and rising payments, where the borrower is not paying any principle, and in fact is "adding" to their loan balance each month. These loans are time bombs waiting to go off as rates rise and property values decrease. Citibank is anxious to get these loans converted to affordable loan programs that will have a lower chance of default.

Now is the time to apply for a loan modification with Wachovia Bank. Their loss mitigation departments are set up and ready to offer qualified borrowers fixed rate loan modifications as low as 2%. This low fixed rate program is available on a graduated interest rate increase, to allow borrowers to get caught up and maintain the new lower payment. Some of these programs only required "stated income" applications, meaning you do not have to provide pay check stubs, tax returns, etc.

Who will qualify for a Wachovia Bank low rate loan modification? Well, you must show the lender that this home is your principle residence, it must be a single family home (no 2-4 units) and your debt ratio must be at 45% or less. This means that your housing debt, including taxes, insurance, homeowners cannot be more than 45% of your stated income. This is only a brief overview of some options available to Wachovia home loan borrowers, and not everyone will qualify for these programs.

If you have one of these bad loans, you should start right away to learn about the loan modification process. Once you know how the process works and what your lender needs to see from you, your loan modification application will have a fighting chance of getting approved. Before you call Wachovia Bank or World Savings, do your homework. There is a lot of information on the internet about loan modifications. In fact, you may be overwhelmed by all the information-it is almost impossible to be sure you are getting the most up to date, accurate and complete information you need.

A very good source of loan modification information and detailed instructions is The Complete Loan Modification Guide handbook. This is a low cost, easy to read and easy to follow Guide that you can purchase and download right online. You will be given the required forms and also provided step by step instructions on how to complete the loan modification forms properly. Included are the direct contact phone numbers, loan modification hardship letter assistance, and invaluable insider negotiating tips to use with the bank. You can save hours of frustration by using The Complete Loan Modification Guide handbook and be assured that you have prepared a successful loan modification application. So get informed and get going to save your home!

If you would like more information on loan modifications, please visit us at:

http://www.stopbanks.com

You can get the help you need to understand the mortgage loan modification process by ordering and downloading The Complete Loan Modification Guide. This is a low cost, easy to read handbook that will provide you with everything you need to prepare a professional and acceptable loan modification application. You are provided with all of the necessary forms and given detailed directions on how to complete them properly. The Complete Loan Modification Guide will take you step by step through calculating your debt ratio, completing the financial statements, writing your hardship letter and then putting it all together to submit to your lender. Get started today on the path to secure home ownership, order and download The Complete Loan Modification Guide.

For more information about mortgage loan modification, please visit us at:

http://www.stopbanks.com

The Lender Requires the Assistance of an Attorney

Over three months ago, a middle aged husband and wife walked into my office. They sought my legal counseling regarding modifying their existing mortgage. Their mortgage was based on adjustable rate making their monthly payments increase every three months.

The husband works as a nurse while his wife is employed in a local accounting office. Between the two of them, they pooled almost $5,500 as monthly gross income. Their average monthly expenses are $2,000 without the mortgage payment.

Before coming to my firm, they continuously tried to renegotiate their existing mortgage on their own. They were current on their payments, but they knew that after two more increases in their interest rate, they will not be able to afford the mortgage payment. Their lender sent them a package which was composed of 12 forms and a list of needed paper work in addition to a personal statement.

Both husband and wife began collecting the required paperwork. After a number of failed attempts, they concluded that the paperwork request by the lender requires the assistance of an attorney. They asked relatives and friends until an old client of mine gave them my phone number.

After making a phone call and scheduling an appointment, they both came in for their first consultation. I sat and listened to their ordeal and brought in one of my lead negotiators. After our meeting, my staff took their paperwork and the lenders package to begin working on the file.

Thanks to 4000 plus modifications, my experienced team was able to reach a deal with their lender. Through a special program called “Three Step Modification”, the lender tests and confirms the financial stability of the borrower. At the end of the program, the lender offers the borrower a loan modification. This is exactly what happened. Their lender utilized the “Three Step Modification” program; and yesterday, they received their modification and signed it in our office.

Please visit http://www.stopbanks.com


Loan Modification

Legal Debt Solutions APC

Founded by John R Habashy Esq

“Nothing beats a happy smile”

“Nothing beats a happy smile”, I always tell my employees. Today, my office staff obtained close to ten modification agreement. This will result in an equal amount of smiles and sighs of relief.

I took a look at some of those files, in particular three of the files. The first one was of a newly immigrant family. They moved to California in 2004 in hopes of staring the American dream. By the middle of 2006, they put all of their savings as a down payment for a condo in the city of Reseda. There realtor took advantage of this family because English was there second language and put them in a negative amortized loan. After the first three months, their monthly payment jumped by an average of 10% every financial quarter. I directed my team of negotiators to use the language factor to gain leverage and obtain a modification faster.

The second file is for a war veteran. Current lending regulations provide a wide range of protection to members of the armed forces. While deployed in Iraq, his wife bought a small house in Oceanside, San Diego County, close to Marine barracks. After the deployment period, the couple’s income was reduced due to missing bonuses. They examined their options and a local priest directed them to my office. Using the “Three Step Modification” program, my office renegotiated both their interest rate and principle to lower numbers.

The last file, the third file is for an elderly lady, a retired junior high school teacher. A smooth talking loan officer talked her into refinancing her paid off house. The money cashed out was supposedly going to be used to fix up the property which was to be done by a friend of the loan officer. She quickly found herself out of money and with a mortgage payment. Showing fraud and evil intent, my office was able to lower her payments to about half of the original amount.

All those and many others regained their happy smiles through the service of my firm. Happiness is a right to every individual in society. I invite you to bring your questions and concerns. My team of experts will provide you with coherent customer support and quick solutions.

Please visit http://www.stopbanks.com


Loan Modification

Legal Debt Solutions APC

Founded by John R Habashy Esq

The Inner Dynamics of Mortgage Modification

Recently, I received an email from one of my clients. She asked me to explain the inner dynamics of Loan Modification. For the untrained eye, the answer seems simple; but the reality is much different.

Through examining recent US history from the economic perspective, similarities do shine. During 1980s, similar conditions were present. Back then, most of consumer lending was based out of financial institutions commonly known as Savings and Loans. Facing outside competition from newly rising Asian power houses, S&Ls began offering creative loans. As the competition became stiffer, both sides relaxed restrictions and underwriting became a mockery of its original role. By 1989, most mortgages went into default. In response, the US Congress went into an emergency session and produced FIRREA (Financial Institutions Reform, Recovery, and Enforcement Act) which resulted in a massive investigation and realignment of the financial sector in Wall Street. In the end, the crisis melted away on its own after leaving the world in economic turmoil known as 1990 – 91 recession.

After a number of years, the world economy recovered and cash reserves began to build up in accounting books. Revenues increased from the government funding bad loans on the expense of common tax payers. Moreover, the events of September 11 took attention and resources away from different government branches.

In 2004 a new boom took over the business world. Stocks climbed to new heights reflecting news of wide spread prosperity. New wealth had been created and almost everyone wanted a piece of it. Real estate professionals ignored lessons from the past and based prices on aspired earnings instead of actual market values. Bankers blurred the lines between commercial and residential loans offering adjustable rates to all consumers. Riding on the same wave, many home owners cashed out the equity in their homes creating higher demands for consumer goods. In turn, stores over expanded and opened multiple locations within the same geographical area.

The sweet sounds of success turned into agonizing cries as rates began climbing upward. Consumers blamed realtors who in turn blamed bankers. No matter whose fault it is, everyone felt the pinch. In order to avoid repeating the same mistake, financial experts produced a new device to reconfigure existing loans. This new financial device is commonly known as Loan Modification.

Through Loan Modifications, banks and borrowers each carry part of the responsibility. Banks agree to lower the interest and recalculate their profit margins. Borrowers control and adjust their life style to match the new payment. Once payments had been made for a consecutive year, the loan becomes seasoned and packaged for sale on the secondary market by different government entities such as FANNIMAE.
Thanks to such creative devices, the real estate market began to adjust. Last month, NAR reports an increase of 3% in sales of new homes. Loan modifications acted as the adjustor factor reflecting the new economic reality. My firm offers to assist needy borrowers with the many forms needed to obtain a loan modification under the Obama plan.

Please visit www.stopbanks.com

Legal Debt Solutions APC
Founded by John R Habashy Esq

Just another day in the Office

Just another day in the office, clients come in carrying fears and leave with lightened hearts and smiles enthroning their faces. This real estate loan modification business carries multiple sides in addition to housing. Just a simple examination of the current socioeconomic situation and many proofs are found.

I remember when I started offering loan modification services. The real estate boom took over all aspects of both our national economy and the international market. One statistical study showed that two out of every ten working adults are directly involved in real estate transactions while another three are indirectly influenced by it.

Money market and creative investment accounts over loaded required reserves measurements leading banks to offer business loans for regular consumers. Business real estate loans are filled with stipulations reflecting economic changes in terms of interest rate. Ill – informed consumers flocked real estate brokerages demanding the amazing starter rates offered by such creative financing products.

By the beginning of 2007, the real estate market began a downward spiral engulfing both the financial and housing sectors of the American economy. Facing a mountain of economic hardships, needy borrowers saw their credit score drop as they became delinquent on their monthly mortgage payments. Moreover, mortgage rates started to climb upward while the lending pool shrank drastically.

Quickly, citizens of the USA reacted and changed the ruling party. Obama started fast. Within the first 30 days of his presidency, he introduced the “Make Home Affordable Program” in addition to others. Those programs were meant to stabilize the real estate market in order to build new bases for a better financial system where both lenders and borrowers carry responsibility without partition.

Loan modification, also known as Mortgage Restructure, is part of this new cycle. This new financial tool offers an alternative to foreclosures and ruined investments. After completing a number of forms, borrowers send a completed package to their lenders showing loss of income and adverse situations. Lenders, encouraged by bailout money and other government incentives, offer qualified borrowers a modified loan agreement that can stabilize interest rate, reduce principle, or both. In any result, borrowers find themselves in better position.

The only problem with this system is the amount of red tape borrowers need to cut in order to become approved. Lender forms are confusing and misleading. The language used is above the average schooling of most homeowners. My law firm offers assistance for such borrowers. My team of experts – proven by both work experience and great academic background – fills out the needed forms and handles all communications with lenders. In most cases, borrowers are put on a trial plan where their new payment doesn’t exceed 31% of their total debt to income ratio.

Stopping this devastating cycle of foreclosure is the responsibility of each member of society. If you have late payments or are about to lose your home, don’t hesitate to contact my firm, the home of 4000 plus modified mortgages.

Smile of Relief

One of the best feelings a lawyer can attain is the joyful smiles of a client. I cannot write enough about the faces of my clients when their mortgage has been modified. Some lose sense and start laughing while others tear. All of them share one feeling, the nightmare is over.

One particular client by the initials of H.C. comes to my memory. She lost both her husband and her employment during the later months of 2008. Her credit cards became maxed out from the costs of the funeral. Her savings were drying up in order to avoid foreclosure. When she asked her close family and friends for help, they were only able to afford drops of water in a dry ocean.

Walking down Brand Blvd, H.C. saw my office sign. She walked in and asked to meet with a member of my legal team as I was coming back from lunch. Her face was dry as her words crunched coming out of her mouth. I told my assistant to bring her some refreshments while I interviewed her.

Inside my office, she began telling the horrors of her ordeal. Her lender refused to modify her loan due to income reasons. Her previous employment record was short and her new employment was not seasoned, less than six month. At the same time, her lender refused to accept social security income as part of the financial statement.

New lawyers and real estate brokers would have considered her case to be hopeless; but not at The Habashy Law Firm. Utilizing both experience and wide knowledge in matters dealing with secured debts, my firm was successful at modifying her loan. First, I wrote a letter addressed to the US Treasury department with a copy sent to her lender. Second, we immediately drafted hardship letters and began a legal audit of her payment history and loan transaction. Third, we called the lender and demanded to speak to a person of rank. Finally we developed our own economic analysis for the bank, showing them that a modification was in the best interest of both parties.

Facing pressure from multiple sides, her lender was forced into the negation table. H.C. got one of the best modifications I have ever seen. At the beginning, her lender offered a rate adjustment of 1.5% and extension of mortgage term. As her lawyer, I advised her to deny this offer. We counter-offered and finally agreed on a 3% fixed rate for the life of the loan; and it was amortized over 40 years as opposed to the original 30 year term.

A week later, meeting at my office, H.C. signed the loan modification agreement. After my assistant took the papers away, she turned around and looked at me differently. Her face began to lift as her eyes were filled with joy. I remember seeing her teeth for the first time since she walked into my office. H.C. jumped from her chair and gave me a big hug thanking me and my staff. And nothing can beat the joy of relief.

Mr. John Habashy is California Attorney, and graduated of USC. His has extensive experience in distressed real estate and finance. He welcomes your remarks or legal questions at info@stopbanks.com or feel free to visit our website at: www.stopbanks.com

Clients’ names had been altered due to client – attorney privileges.

There is not single answer for Debt

The science of psychology holds that there is a biological consequence for psychological affects. Homeowners are a good example. The monthly stress of making huge monthly payments, in addition to general living costs; accumulate an unseen weight on the human thinking process. This is an evil cycle of events.

Everyday, I meet and talk to clients who are suffering from accumulated debts. This might be the result from excessive spending patters, but mostly their debt is a direct result of sudden inflation in their primary mortgage bill. Borrowers are faced with a tough choice of either paying their mortgage or fulfilling their other life liabilities.

This dilemma is magnified more by the introduction of certain variables. Currently, most families with college age children are experiencing a sharp rise in educational costs. Another group of Americans, some 50 million, are living without health insurance and another 35 million inadequately insured. For those who are luck enough to have health insurance, their premiums are constantly rising faster than the median household income.

What can anyone do? The answer falls into two folds. The first part depends on each individual’s status. Home makers are in a very different situation from singles. The economic capacity varies greatly, which in turn, affects general decision making. Second, the immediate social circle demands certain results. A doctor’s life style is not the same as a peace officer’s.

Because of such multiple components, there is not a single answer for debt. By its own nature, debt is as old as society. But as a modern society, we have tools and methods to deal with the psychological impact. Except of a very limited number, individuals are very ignorant about their rights. Moreover, lenders and financial institutions hide and alter much factual evidence in order to hold a stronger leverage. Borrowers ought and must utilize what society provided. This translates into legal argumentation's.

As a lawyer with extensive experience in the loan modification business, I invite needy and stressed borrowers to make use of legal system. The US congress, in addition to both state and local government, enacted many statutes in favor of the consumer. There is no need for any individual to experience psychological trauma, and its consequences, in their individual battle against the much more sophisticated opponents.

The law is here to help.

http://www.stopbanks.com

"Just another Victim of a Vicious Cycle"

Two days ago, I went to grab a cup of coffee with one of my interns. As we approached the coffee shop, my intern spotted a well known former broker within the Middle Eastern society of southern California. At one time, this person ran a full mortgage corporation with over 50 loan officers and direct open lines of credit from Deutsche bank.

Sending my intern to pick up the coffee, I approached him as we were friends in the past. He was shocked to see on the streets of Glendale but still welcomed my sudden appearance. Immediately, we started catching up and the topic of real estate came up. I asked him about his corporation. A sad and grim look took over his facial expressions. He started by telling me about the good old times when approving borrowers was very easily done. He closed his operation after trying to keep it afloat after the Real Estate market crash. During this process, he spent over a half million to cover over head costs in order to avoid firing and laying off so many workers. A tear dropped behind his sunglasses as he continued to speak.

I couldn’t help it to ask him to stop. My intern came back with the coffee and I sent him back inside to get my old friend a drink. I asked him about his current source of income. He told me that he works within one of the major banks in the mortgage department. I made good work of this movement in the conversation and brought up the Obama plans. He replied back and stated that it has too little effect on the volume within the market. I asked him about the new refinance programs. He told me that this is his new role. According to him, those new programs are only applicable to existing government backed mortgage plans such as FANNIE MAE.

In addition, the new plans carry a new stipulation: only one lender on the property. If borrowers have more than one lender, they need to obtain releases from their debt. I gazed at him with amazement. He turned and pointed at the street and said: “Look John … see all the people in our sight. The Real Estate market will continue its decline for another three years at least. Everyone will feel its pinch.”

My intern returned and handed him a cold cup of iced coffee. He took a big sip and began to talk about REOs (Real Estate Owned). He indicated that most banks have a huge inventory which will be hitting the market within eighteen months. I told him that if banks do such a thing, real properties values will plummet even lower. “They don’t care”: he replied back to me. Taking another sip, he added that the only reason banks are withholding such a huge release are the real estate associations.

We continued to talk for a little bit only to be interrupted by his need to return to work. Holding my cup of coffee, I took a long walk with my intern. After a ¼ a mile, my intern asked me about my friend. I looked at him and said: “just another victim of a vicious cycle”.

Mr. John Habashy is a California Attorney, and a graduate of USC. His has extensive experience in distressed real estate and finance. He welcomes your remarks or legal questions at info@stopbanks.com or feel free to visit our website at: www.stopbanks.com

Miss. M

Is everyone a criminal? The answer is NO. There are some who induce crime or become subjected to its influence. The majority of our nation’s population is hardworking individuals. Everyday, I witness how banks deal with borrowers as if judgment had been rendered. This was particularly clear in the case of one Miss. Moran, or as my office dubbed it “The Curious Case of M”.

Miss. M is the mother of two children in addition to being the wife of a crippled person. She acquired a number of properties after the death of her father. The income generated provided semi – adequate support for this family of four. Miss. M, also, worked a 9 to 5 job as a registered nurse in a local senior housing.

As our nation’s economy began to recede into red territory, Miss. M began to see her income from the rental properties drop. She had some existing loans on the properties in order to cover her husband’s medical expenses. Rough times rolled into her life like a tsunami wave crushing all walls of security.

Confused and disoriented, Miss. M’s life turned upside. She heard about the Obama plan and tried to modify her existing mortgages. Running between five different banks, the pressure caught up and she failed to provide all required documentations within the given deadline. Finally, banks began a massive wave of harassment including sending agents to Miss. M work.

Cornered by massive accumulated dept in addition to daily life expenses, Miss. M read our ad in the Asian Journal and called my office. Client-In-Take service forwarded her call to my office. She scheduled an appointment for the following night as she works in the morning. I got some of her information and authorization to start investigating her case.

When Miss. M came in, she was a mess. One can easily spot the affects of her ordeal with darkened eyes and fragile words. She had many large envelopes; each carried a story and part of her story. Immediately, I called in a group of assistants and negotiators to study the documents. I even directed my staff to start processing Miss. M paperwork before the sunrise. She started tearing and began experiencing rise in emotions. A member of my staff with a degree in counseling began talking to her. She was able top calm Miss. M down.

Next morning, my staff contacted Miss. M’s lenders and began organizing loan modification packages with all the required documents. Moreover, I sent Cease and Desist letters in order to ward off the constant bombardment of harassing actions. Facing tough legal and experienced legal team, Miss. M’s lenders threw the white towel and began offering solutions.

As I write this article, Miss. M is enjoying an affordable mortgage rate which reflects the reality of the current mortgage market and value. Her lenders viewed her as a “criminal” for cashing out equity. Such lenders give themselves unwarranted authority over borrowers’ actions. They know that most borrowers can’t afford legal help. Now days, lenders penalize borrowers for the current mortgage crisis which is produced largely by greed of lenders and their loan officers.

http://www.stopbanks.com/

American International Group, real estate bubble berthed

American International Group, commonly known as AIG, has been in the media since the middle of 2008. According to the 2008 Forbes Global 2000 list, AIG was the 18th-largest public company in the world. Most of AIG investments are tied directly to the US real estate market. AIG used mortgage backed securities to build momentous wealth.

As the real estate bubble berthed, AIG found its self in very unfamiliar grounds. AIG’s net worth shrank pulling the stock value below the $5 mark causing dire consequences for them. Under SEC and IRS rules, most pension funds had to withdraw their capital which caused AIG stock to drop even lower.

For over 5 month now, AIG has been surviving through direct funding from the US government. Both the Bush and Obama administrations have pumped over $300 billion to keep AIG afloat. In exchange, AIG promised to revise their operations in order to afford paying back the government.

During the past weeks, public opinion expressed anger over the AIG bail out. The rage was driven by leaked news showing “bonuses paid” to about 30 executives at AIG. Both democrats and republicans expressed their anger and disappointment. Seeing the need to calm public opinion, President Obama said he will “take responsibility”.

Yielding to the demands of the public, the lower chambers of the US congress passed a tax bill to be attached to the AIG bail money. The White House came out strongly against such measures. Featured in the CBS news program ’60 minutes’, President Obama called the new tax bill as “targeting special people”.

Benjamin Franklin once stated that:  “All human situations have their inconveniences. We feel those of the present but neither see nor feel those of the future; and hence we often make troublesome changes without amendment, and frequently for the worse.”  In our age of advanced technology, our economy is intertwined with the entire world and true balance is required.  To see our hard earned tax dollars given to the ultra rich is extremely disturbing.  Our ideologies of capitalism have been compromised.

Our government has made radical decisions in “handing out” money with no accountable measures in place and no true due diligence.  Is this not the same irrational decision making that led our lending institutions (and entire country) to the verge of dissolution?

Mr. John Habashy is a California Attorney, and a graduate of USC.  His has extensive experience in distressed real estate and finance. He welcomes your remarks or legal questions at info@stopbanks.com or feel free to visit our website at: www.stopbanks.com

Lenders are now tying up our nation’s credit market

The Talent is Being Lured Away by the Other Side

So far, April has been a great month. Michael Jordan’s old college team and pre – season favorites, North Carolina, beat Michigan State by more than 15 points to win the NCAA tournament; the stock market jumped briefly above the 8000 mark and even the secret service foiled a plot to assassinate President Obama in Turkey.

But not all things are moving in a positive direction. Most banks operating within the United States are still refusing to help distressed homeowners. Most of these banks are nothing but a servicer, acting on behalf of an investor. They drive their corporate profit by tagging huge sums of fees and charges on simple transactions.  Some lenders add fees for the modification process and add it on to the principal balance of the loan. When I ask about the fees, no reasonable explanation is given.


In addition, most banks are actively discouraging borrowers from seeking legal help. Lenders are adding a warning on their automated message line telling homeowners that hiring legal help will prolong their modification. In the same message, they inform the distressed homeowner that their institution will pursue all available means in order to legally collect payments.


Lenders are now tying up our nation’s credit market. After receiving large government aids, our lending institutions are using these funds to buy more bad assets from other failing lenders.  The Presidents executive order clearly outlines the banks duties as a reciprocation for receiving government aid.  One of the conditions to receiving aid is that the banks are to modify mortgages to help the distressed homeowner.  However, the banks have not implemented the Presidents orders and we are met with resistance on a daily basis.  Every modification is a fight for our firm


Our Country is indirectly supporting and sustaining the same banks that failed us in the past.


Mr. John Habashy is a California Attorney, and a graduate of USC.  His has extensive experience in distressed real estate and finance. He welcomes your remarks or legal questions at info@stopbanks.com or  feel free to visit our website at:  www.stopbanks.com

Forensic loan document audit process

Forensics Audits Process

The forensic loan document audit process is designed to discover if a lender violated the Truth in Lending Act or made any errors while preparing their closing documents and neglected to adequately disclose the terms of a loan.

Some of the areas covered are:


 Truth-In-Lending Violations

 RESPA Violations

 Misrepresentation

 Predatory Lending

 HOEPA (Home Ownership and Equity Protection Act)

 Breach of Contract

This tool increases leverage in negotiations with the lender and provides additional incentive for more advantageous loan modifications to benefit our clients.

The number one goal of the forensic loan audit is to determine whether there were violations of Federal law. If these violations are found the borrower may be able to obtain complete relief from the predatory loan or a favorable loan modification.

When our firm represents you we will send a Qualified Written Request to your Lender on your behalf as Counsel, to which they have 20 days to respond. When the documents are received, our auditing staff reviews it all and looks for any breaches to be used in your defense.

http://www.stopbanks.com/

President Obama’s Homeowner Affordability and Stability Plan

http://www.stopbanks.com/

As many as 6 million families are expected to face foreclosure in the next several years

The severe and rapid decline in the economy and in the housing market has created devastating consequences for homeowners throughout the country. Millions of responsible families who make their monthly mortgage payments on time have seen their property values fall and as a result are now unable to refinance to lower mortgage rates. Meanwhile, millions of workers in this country are struggling to stay current on their mortgage payments after loosing their jobs or being forced to take a reduction in work hours. Over 5 million jobs have been lost in the past 14 months and millions of hard working families are now spending more than 40 or 50 percent of their income towards their monthly mortgage payment.

President Obama’s Homeowner Affordability and Stability Plan (HASP) introduced earlier this year, offers assistance to over 7 million homeowners who are currently making a good-faith effort to stay current on their mortgage payment s. HASP supports a recovery in the housing market by stabilizing home prices in communities hardest hit by foreclosures. The program brings lenders, servicers, borrowers, and the government together to share in the cost of restructuring mortgages so homeowners can afford their monthly mortgage payments.

Homeowner Stability Initiative

offers reduced monthly payments for 3-4 million“at-risk” homeowners allowing them to continue paying off their mortgage and avoid foreclosure. The goal of this program is to reduce the amount that homeowners owe each month to a lower, more affordable amount. Under thisinitiative, loan servicers are required to reduce monthly mortgage

payments to less than 38% of the borrower’s income by restructuring or modifying the current loan. Anyone with a high combined mortgage debt compared to income or who is “upside down” on the mortgage may be eligible for a loan modification. Borrowers who are in adjustable or Subprime loans with high interest rates are also eligible. Mortgage loans can be modified by reducing the interest rate for a specified amount of time, extending the term of the loan (to 40 years instead of 30 years), and/or principle reductions. Servicers covering more than 75% of the loans in the country have begun modifications under Obama’s Homeowner Affordability and Stability Plan.

2^nd Lien Program

Millions of workers have lost their jobs or had their hours cut, are now struggling to stay current on their mortgage payments. In the next several years, as many as 6 million families will face foreclosure and millions more will struggle to keep up with the rising interest rates on their mortgages. Second liens contribute to those numbers of families who are unable to afford their housing payments. It is estimated that up to 50% of at-risk mortgages currently have second liens. The 2^nd Lien Program offers homeowners a way to lower payments on their 2^nd mortgage. This program coordinates with the first mortgage modification process to lower payments on 2^nd liens, helping to keep more than a million Am

ericans in their homes. In some cases, the servicer may accept a lump-sum payment from Treasury to eliminate some or all of a second lien. This program shares the costs with lenders who participate in reducing payments for homeowners with 2nd mortgages.

I don’t need legal assistance; my Mortgage Company has sent me a letter offering to modify my mortgage.

With all of the Government programs in place offering incentives to lenders, why do I need legal assistance with my loan modification?

It is true that there are financial incentives for lenders willing to modify mortgages. But, For a lender to be eligible for these incentives, they need only to OFFER assistance to the homeowner. By sending a letter to the homeowner, OFFERING to modify the mortgage, lenders have fulfilled their requirement and are then eligible for Government subsidizing. They do not actually have to follow thru with the loan modification.

Why can’t I just apply by myself?

When a loan modification application is submitted by a homeowner, it is thoroughly reviewed to determine the profitability to the investor or the likelihood of loss. The “Net Present Value Test” is used to determine what will create more cash flow to the investor-Foreclosure or Modification. Their decision has nothing to do with what is in the best interest of the homeowner. It is solely based on what is more profitable to the investor. If modification is not in the economic interest of the investor, they will decline your application.