Meet Wadet.
Wadet is a single mother of 3 beautiful girls. When Wadet purchased her home during the housing boom she was full of pride and joy for becoming a first time homebuyer. She didn't buy more than she could afford at the time. Wadet knew about being a wife, being a mother and working hard and she trusted the professionals to guide her through the loan process she didn't necessarily understand how it all worked and what type of loan she was getting. I know we all have to be responsible for our actions and for what we take on but these people thought they understood and they were convinced that they were getting certain terms, they trusted the professionals, to their own fault.
Wadet was newly married, her housekeeping business was going great because along with the boom came a surplus of work for housekeepers and when the economy was thriving so was the housekeeping business. Wadet bought her home knowing she could afford it and she even had a nest egg saved up for a rainy day.
What Wadet didn't know is that she would later become a victim of domestic abuse, followed by a downturn in the economy, a pending divorce and no child support for her 3 children. Who knew that her clients would also lose their jobs, income and homes. Who knew that she would not be able to count on her husband for financial support, who knew that people would start cutting back and clean their own homes. Who knew that she would be unable to make her payment. This is exactly what happened.
Wadet immediately asked her parents to move in with her and help her pay the mortgage but soon the rate adjusted as she had an adjustable mortgage and she found herself drowning and not being able to make the higher payment.
Unfortunately, since many people are suffering through this crisis there are unscrupulous people who prey on these people that don't understand the system, they didn't understand it going into the loan and they don't understand how to save their home, how to talk to their lender, what to say, or what to do. A realtor involved with her church advised her that the ONLY thing she should and could do was to sell her modest townhome short sale. Did the realtor ask her what she really wanted? NO, she told her that was all that she could do, this seems to go on a lot these days and this self serving activity is wrong. People should do what is in the best interest of others and take into consideration their wishes not their own greedy self serving interests. But that is just me, who am I to judge the actions of others.
Since Wadet is not well versed in real estate or in many other complicated financial matters there is a lot of difficulty, not only for her, but to the average person who is trying to navigate this process and she believed and trusted this realtor and allowed her and put her house up for sale. Never once did she ask Wadet whether or not she wanted to try to fight for her home. Who's interest is being served here? The realtor even showed up with a moving van without consulting with Wadet and told her she was moving her out because her house would show better and may sell faster with her out of it, can you believe this?
Wadet never really wanted to lose her home or sell it but she thought that was her ONLY option. I am so glad that I met Wadet and my life has been touched by her beautiful heart and that of her parents and children, my life will never be the same and neither will hers. We sat down and I found out that she wanted to keep her home and we began to compile her hardship letter, her income, her parents income and expenses. Her Trustee Sale was in 2 days so we had to hurry and reach the right people to save the home. Postponing the sale was the #1 priority.
The lender was contacted and advised that she was going to fight to save the home and that she would be submitting an application for a loan modification. After more than 5 phone calls, countless emails, and several hours of work we accomplished the task of postponing the sale. Now we could work the numbers correctly and put together an organized package for the lender. The protocol suggested by the lender was followed and the request was sent in. Once the package was submitted we kept contacting the lender on a schedule of approximately 2 times per week and kept a close eye on the sale date to make sure no mistakes were made. Alerts and reminders were set up to make sure the sale was postponed during the process that can usually take several months to complete if you stay on it.
I reassured Wadet, who was very nervous in the beginning of the process, but soon she realized she had found an inner strength. I showed Wadet the importance of advocating for herself, becoming empowered and being determined to succeed without letting up. Soon Wadet no longer was under stress because she understood the determination that had to be put into getting her loan modified and could visualize her own success. The process is not easy and it does not happen overnight but much like everything in life, nothing good comes easy. Everything good takes effort, faith, belief and determination, including loan modification. She just needed a support system to guide her through the process of dealing with her servicer. I would love to say that the loan modification was approved the first time, but this was not the reality and you may be going through this exact scenario right now, so you may know that this is the way it is, unfortunately, most banks don't make this loan modification process easy. Do not be discouraged, press on.
In addition, most servicer's were not prepared for the growing numbers of foreclosures and loan modifications that they would need to process, internally they have had to hire new people that may or may not know the guidelines themselves and the workload is large for each employees which in turn builds internal stress on their part, not to mention emotional, scared and many times mad homeowners calling all day. This causes many delays and a need for you to be your own best advocate in saving your home.
No matter what they throw your way negative or positive you must remain calm, positive and have an attitude of gratitude. Send your positive blessings to everyone you come into contact with and if you don't get the answers you need from a particular person, call back or escalate to a supervisor all the while keeping your inner peace and positive energy. Be prepared and have the right expectations because if you are prepared for it, somehow, it makes it just a little less frustrating. You are not alone in this.
We kept the focused course, worked with Wadet to lower some expenses and find ways for her to increase her income. Once that was accomplished her file was resubmitted. Unfortunately she did not get the answers that we wanted. The income numbers that the lender wanted to use were inaccurate numbers but we did not let this get in the way of her goal so we kept going and we fought it and fought it and kept track of the sale date to make sure we got it postponed and guess what? The modification was finally approved. It was not quite what we needed and the numbers were tight. She could manage it but we were exactly at the max she could make. She accepted the loan modification and at this time there were no government programs available. Knowing your numbers and the guidelines better than the servicer are imperative and in your own best interest when you are advocating for yourself.
I'd like to say she lived happily ever after, but unfortunately and also fortunately this was not the end of the story. 6 months into the new payment the servicer readjusted her impounds for property taxes they did not include in the calculations, they had promised to spread the back taxes over 5 years and then all of a sudden came back and only did it over 12 months and her payment shot up just as high as the pre-modification... back in trouble.
I told Wadet that she should go back and work with her lender again to make sure they gave her an affordable payment since she had not received a HAMP loan modification she was able to apply for this and make it right, she went back to the lender and escalated her file to the Home Preservation department along with upper management and succeeded in resolving the issue with the previous modification that failed to help her as they promised.
She was able to get her a permanent HAMP modification from $2982.57 that did not include her taxes and insurance to $1,558.31 including her taxes and insurance along with other great term changes for her, including adding her past due payments to the end of her loan and not having to bring all of this money in order to save her home. Mission accomplished. Wadet is very happy this is something that is manageable for her and her family and she save her home. She was not a deadbeat, as people that are facing foreclosure are portrayed, there is no reason that she should not purchased this lower priced townhouse, nor was her only option to do a short sale of her home.
It is not easy to stay positive and determined when you are going through this process, it is certainly nerve wrecking while you are going through it and especially if you are getting bad advice from people that don't always have your best interest at heart and many times only confuse you more and emotions can get in the way with fear leading your every action but you MUST find a way to believe that you are going to get it done and then set out to make it happen no matter what obstacle gets in your way, including denials and unexpected changes that life throws your way.
By the time Wadet received her final approval new programs had became available that were not there in the beginning. Everything happens for a reason and in this case every event and time delay that occurred led to the final perfect outcome. Wadet and her family are still in their home making the affordable payment that she obtained through President Obama's Home Affordable Modification Program loan modification. Unfortunately people have needlessly lost their homes for many different reasons, many should not have happened.
You must know how your income and expense numbers look in the eyes of the lender and you must question authority, be the squeaky wheel, be your own best advocate and do not give up!
Anna Cuevas is an invited blogger on The Huffington Post, author of several soon to be published books and the Founder of www.askaloanmodguru.com a blog dedicated to empowering homeowners with free information they need to confidently apply for a loan modification and also providing the latest Do It Yourself tools to Save Your Home. Request your free copy of Dirty Little Loan Modification Secrets You Must Knowalong with free bonus materials that take the guess work out of the loan modification process to stop your foreclosure dead in it's tracks.