Home Mortgage First Aid Kit

by Cathy Moran, California Bankruptcy Lawyer

If your home isn’t the refuge that storybooks say because of mortgage troubles, don’t give up.

If you’ve missed payments, you’re reaching the end of the interest only period, or the value has plummeted, you need some tools to help you stay in your home.

The bitter truth about the mortgage mess is that the fight is lop sided. Even the banks caught committing fraud on their borrowers are getting off easy. Enlist some help and be persistent.

Gathered here are links and points of contact for the major out of court levers to get you started on a quest for a reasonable modification of the loans on your home.

HAMP

HAMP stands for Home Affordable Mortgage Program. The federal government offers the lenders financial incentives to modify mortgages and even reduce principal.

Making Home Affordable Here’s the portal that leads you to different programs within HAMP: loan modification, foreclosure prevention, etc.

Eligibility starts with home loans with principal balances under $729,750 on single family homes that is your principal residence. Not all lenders participate, and not all loans qualify. Here’s the HAMP FAQ

FHA HAMP

If your loan is insured by the Federal Housing Administration, there’s a separate program for loan modification. Call FHA’s National Servicing Center at (877) 622-8525 for more information.

National Mortgage Settlement

This isn’t a program so much as a requirement that the five biggest servicers provide billions in concessions to borrowers to atone for their misdeeds.

The settlement has its own website and a court appointed monitor to make sure the banks do what they are required by the settlement to do. The monitor wants to hear about difficulties the public has with the banks involved. Here’s where to lodge a complaint.

If your servicer is one of these banks, you may be eligible for help.

Fannie & Freddie

The settlement does not extend to loans owned by Fannie Mae and Freddie Mac, the giant buyers of home loans. They are now in government receivorship.

Fannie maintains a site listing options for Fannie Mae loans.

Freddie followed suit with its resources for modify Freddie Mac loans.

If your loan doesn’t qualify

The mortgage modification programs above focus on owner occupied homes with mortgages under a certain limit. Banks have their own modification programs for loans that don’t qualify for a subsidy (to the bank) for modification. Contact the lender directly for loss mitigation or foreclosure prevention programs.

Getting the runaround?

Trouble with lenders and servicers seems to be everywhere. The new Consumer Financial Protection Bureau wants to hear complaints about servicers.

My clients have had some success asking their Representative in Congress and our US Senators for help getting the attention of the lender.

Free counseling

The federal government’s Housing and Urban Development Department certifies counselors who can help you understand your options for your home. Their services are free and reliable.

Find a housing counselor near you.

The bitter truth about loan modifications is that lenders are largely indifferent to the borrower’s troubles and grossly inefficient in processing applications. Success requires dogged determination. Don’t take no for an answer. Reapply, seek help from your governmental representatives, and consider whether a Chapter 13 case and the supervision of a judge would even the odds.

San Francisco Bay Area Bankruptcy Specialist Cathy Moran helps individuals and small businesses in Silicon Valley with their bankruptcy issues . She can often be found on Google+ and on Consumer Ledger, where she shares information about consumer protection issues and personal finance.