How does a Loan Modification Affect Your Credit?

Posted by admin On September - 18 - 2008

A loan modification is one of the best options to prevent foreclosure and keep your home-but how will the loan modification affect your credit?  Well, that depends on a couple of things-were you behind on payments prior to the loan modification?  Did the lender agree to reduce your principle balance as part of the loan modification?  It’s not really the loan modification itself that would cause a negative report on your credit, a negative rating would be triggered by late or missed payments and not adhering to the terms of your original loan agreement.

Some loan modifications include a reduction in principle whereby the lender actually “forgives” part of the money you owe them.  In those cases, the bank may report the account as “paid for less than owed”, which is not a good rating.  In the majority of cases, there have been late payments reported already-prior to any loan modification agreement.  In those instances, a loan modification will only be a benefit to your credit standing as now you will be brought current and the loan should be rated as such.

Since loan modification is a relatively new option for homeowners and lenders, there is no “set” procedure or precedence in place for how a loan modification is handled with the credit agencies.  A good idea is to include in your loan modification negotiation an agreement with your lender that will protect your credit rating.  When working with your bank to find a workable loan modification, ask them to agree to update your loan as “current” with the credit bureaus when you sign the new loan modification paperwork.  They are under no obligation to do it, but it certainly won’t hurt to ask them.

Getting back on track with a loan modification is the first step to re-establishing your good credit rating.  A loan modification can help you avoid foreclosure and get a fresh start with your lender.  Tens of thousands of homeowners have successfully modified their home loans.  YOU CAN TOO!  You just need some upfront knowledge and guidance to give you the fighting chance you deserve to save your home.

A great source of information on loan modifications and credit score secrets is The Complete Loan Modification Guide handbook.  This easy to read and easy to follow guide will give you the 7 Steps to a Successful Loan Modification, as well as invaluable negotiating tips to use with your lender.  The Complete Loan Modification Guide handbook provides you with the necessary forms along with detailed instructions on how to complete them properly.  This is a must read for every homeowner considering a loan modification-DO NOT contact your lender until you have read The Complete Loan Modification Guide handbook-you have one shot to save your home-get informed and get going!

If you would like more information on loan modifications and credit report secrets, please visit us at:

71 Responses

  1. robert Said,

    I bought my house back in 1993. I have had to make money out because of medical reasons and refinanced about 6 months ago at 6 percent. I have on going medical bills because of a son with autism and this forces my wife from taking a job because of all the running around with my son. I have about 150,000 in equity still because I live near the beach but my house had came down around 200,000 in the last year. I work for the government and we are not getting cost of raises for the next 2 years and are facing salary reductions. I have about 10,000 in credit cards because of medical bills but that is our only bill as our cars are paid off. My mortgage takes 47 percent of my income away each month but I am not behind in the payments. I also have some money in a rainy day fund but would only use in an emergency. Am I a candidate for a loan modifcation. I tried to refinance but the lenders want 720 to get the good rates and my fico is 679 because of the high balance which i could pay off tommorow but would leave me with no cash. I rather have cash because i can just default on a credit card. Thank You

    Posted on March 10th, 2009 at 8:51 pm

  2. Deborah Said,

    My mortgage lender will not make an effort to respond to my loan modification documents sent to them 3/19/09. I am not yet behind on my payments but have been unemployed since Nov 2008 and my income is 90% of the household. If we do not get help, we will lose the home. A company called Save My Home Midwest claims to have 30 attorneys that will get this loan modification process moving for me. There are attorney’s fees, between $900-$2500. Is it advisable or should I walk into a Chase Home Finance office in my area for help with my loan modification package? Their 800 number is no help. I have tried too many times to keep up the effort. No one on the other end knows anything about the program or my documents.
    The government site says this is not supposed to be happening but the reality is, it is happening. The mortgage company will not help me.

    Posted on April 4th, 2009 at 12:00 am

  3. Dave Said,


    I cannot tell you how VERY important this question is in my wife and my financial situation. A rapid response would be GREATLY appreciated.

    We own a house with a large mortgage. We are not delinquent with any payments or behind on property taxes. HOWEVER, we are close to the edge.

    Looked into refinancing thru our current lender (Chase) among others, which is not an option as I’ve been locked in at 5 and 5/8ths and to drop only 1 point and have to pay points to do so, does not make financial sense.

    With all the hoopla around Obama trying to keep people in their homes, we decided to look into a loan modification, which looked real good. It would lower our overhead by about $400 a month and the bank pays the property taxes. Lo and behold, just before we’re about to sign and return the paperwork, we find this could negatively impact our credit. Our credit is good, we do not want to jeopardize it, but we don’t want to become delinquent on our mortgage or property taxes.

    How dramatically does a loan modification affect your score? How long does it stay on your records? We only plan on living here a few more years and want to move on. We don’t want to be paying 9%, because of poor credit.

    Thank you.
    Dave and Sandra Peterson

    Posted on April 29th, 2009 at 4:13 pm

  4. MNA Said,

    We had problems even getting phone numbers for the escrow department… or when we did get thru to someone they hung up on us.. we went into Chase bank locations… only to be told NO CAN HELP… so We wrote to the FTC filed complaints.. and to the Office of the Comptroller at the US Dept of Treasury.. the Dept of Treasury stirred someone at Chase bank because we got a nice letter and an invite to work together to solve the problem… After all who holds the bailout monies??? the Treasury!!! here is where you can start your complaint process

    Posted on May 1st, 2009 at 3:52 pm

  5. Zahira Said,

    I am no expert on the subject but have been in he banking industry for 15 years working directly with credit approvals and selling notes. Your credit will be damaged but it will recover a year after the loan modification is running. You will, little by little, regain your credit rating.

    As the banking industry has been so impacted, the consumer and mortgaging lending has bercome very conservative good or bad credit is really making little impact on desicions, unless is really bad credit. Now it goes more towards how many credit lines you have opened and what their balances are. To have your credit impacted but to save money will only give you peace of mind. A decision like this can make or brake your marriage, if you have kids the way you planned to raise them the education they receive from you. Financial concerns of this sort have a lot of preasure on relationships. Your mood will be different. You yourself said that you were on the verge of falling behind. The question you should ask yourself is: What would I rather keep? What should I risk? My Family/ My credit rating.

    Posted on May 5th, 2009 at 10:22 am

  6. Mary Said,

    For Deborah, who posted 4/4/09, just so you know, it took Chase a little over 7 weeks to confirm that our loan modification papers were received. When you fax them, they have alot of backlog. No one knows anything until the papers are updated into the system. So keep calling every week or 2 and you should hear something soon.

    Posted on May 16th, 2009 at 10:06 pm

  7. Suzanne Said,

    How do you know if the company is reporting “paid less than owed” or “current”? I have no late payments on my mortgage and am current but am modifying my loan because I have (or had) a 10/1 arm, a super jumbo loan, and a husband with no job. Citimortgage just told me today that they closed on this new loan for me at 2% interest for 5 years, 30 year variable, cannot go above 5.59%. What if my credit is wrecked?

    Posted on July 2nd, 2009 at 1:19 pm

  8. Tyler Said,

    For Suzanne, Citi offered me the same deal but for 40 years and the rate will go up 1 point per year until it gets to the going rate. I have good credit and no late payments and I was at 5.875 for 30 year fixed So I dont know if it will damage my credit and also did they lock that rate in on your paperwork. And to all those waiting on the banks .. be persistent, its taken me a little over 4 months and still going, Thanks Tyler

    Posted on July 3rd, 2009 at 1:11 am

  9. g Said,

    I have been dealing with our lender since December but since we are not late they would not help. Then end of March I put new paper work for the new program. I had to keep calling and bugging them sometimes waiting up two hours on hold. Just last week they said some one will review it and call me back that didn’t happen. We finally got an answer this week they denied us according to them they feel we can make our payments and are not willing to work with us. We also have a lot of medical bills and we are current with our loan but barely making it. I’m frustrated because it took so long we are going to try with a mortgage company see if they have better luck then I did. It was a lot of hassle and headache trying on my own. I hope I this works.

    Posted on July 23rd, 2009 at 9:14 am

  10. Alexandra Said,

    I was told by Wells Fargo (today) that a loan modification will not affect our credit because we are not behind on our mortgage. Does anyone know if that is really true?

    Posted on July 23rd, 2009 at 10:23 pm

  11. Kay Said,

    Just a warning….
    I was not behind on my mortgage payments and requested a loan modificaiton. While the loan was being processed, they put me on a trial payment plan until the modificaition could be completed. About three months into “the trial plan,” i found out that the bank had reported a serious deliquency to all three credit bureaus. My credit cards (which were all in good standing) all increased my APR to 19.99% and my credit lines were lowered to just above the credit limit! One of them closed my account without even telling me. My credit score has dropped over 100 pts in the past four months. I still have not heard back about my modification. I dont know what i should have done differently, but I AM SO SCREWED right now! I dont know what I’m gonna do.

    Posted on July 29th, 2009 at 12:27 pm

  12. sue Said,

    I work with a mortgage company and thought I would supply some of you with some basic facts, First there is nothing a third party agency or attorney can do with your loan that you can not do yourself. They are going to call the same numbers you will call and they are going to submit the same docs and they are going to wait the same time, in all actuality it will slow down the process because your account is secured information and with out a letter of authorization on the account no one within the company can talk to the third party and that process can take several weeks. With the govenrment program it is a 20-30 minute phone call and either you qualify or you dont. Usually if there is something they can offer they will. If you are unemployed there is usually nothing they can do. Investors will not approve a modification with out stable income and we all know. unemployment is not stable. also anything you do different then pay your mortgage on time with the terms you agreed to will affect your credit. with the Obama plan if you go into it current it reports paying under a agreed plan and once the mod happen it reports mod agreed to by both companies. That is what is required by the credit bureau. with the obama plan they try to get you to 31% but you have to be logical if they cant get your 500000 mortgage down to 31% of 2500 in salary the answer is no. They are not offering principal reductions only forbearances so if the cant get what you owe stretched out to 40 years at 2% to represent 31% ,it is a no. And if they can get it to 31% they still will not offer it if after all of your bills are paid you still cant afford the new payment. People have unrealistic expectations. it really all is a simple numbers game. And another requirement is you have to have a hardship do if you have money in a savings account that represents more then three months cash reserves you will not qualify and if you have equality in your home you will not qualify.

    Posted on July 29th, 2009 at 10:46 pm

  13. molly Said,

    I am up to date on payments, I have good credit – I am laid off and hanging by a thread – I applied for modification w/ wells fargo – they agreed to reducedmy payment for a 4 payment “trial period” – I read the paperwork entirely – yes they do report to your credit – and as the woman who posted before me said – I think that will have reprecussions with your credit cards – also they add on the difference between the old and the new monthly amount at the end of the trial period – at least this is how I read it – I have had phone calls from wells fargo asking what I want to do – when I ask them questions back they do not have the ability to answer the questions and give me a number to call – I am sorry but this just seems to be a mess – just give me a refinance with lower interest – I am already paying my mtg and have never been late – but they will not due to the fact I was laid off – I am so frustrated – the lenders are being paid back by the government for a % of each person they modify – it’s good for the mtg. companies but not sure it is helping us who try hard to pay our bills. again the middle guy gets the shaft!

    Posted on August 15th, 2009 at 2:28 pm

  14. Rockon Said,


    I cannot tell you how VERY important this question is in my wife and my financial situation. A rapid response would be GREATLY appreciated.

    We own a house with a large mortgage. We are not delinquent with any payments or behind on property taxes. HOWEVER, we are close to the edge.

    Posted on September 1st, 2009 at 7:48 am

  15. Ricardo Said,

    As far as I know modifying your loan will not affect your credit if you’re not behind yet. Once you fall behind and are facing foreclosure, obviously the damage to your credit has already been done by late or non payment, so your credit should not be the reason you don’t modify. Post 12, Sue gives a lot of good information however some is a bit inaccurate or one sided.

    If you are in a situation where foreclosure is eminent or a possibility, you actually have a bit of leverage if you qualify. The bank would much rather modify and drop your interest rate to 2% or even 0 to keep you in the house if it makes money sense to them. By the time the bank takes your house, does necessary fixes, pays a realtor to list, THEN sell at a discount, they will probably be wishing they would have just lowered your payments. I’m not saying that this is true for everybody because first of all you have to qualify for the plan.

    But if you’re even thinking this could happen to you I suggest you find out what the qualifications are for the modification. You will need to get all your ducks in a row before you contact your bank, however once you do, you will be a more informed person. And with all your information in hand, it makes it a bit harder for them to ask you for something you weren’t expecting and have to call back, or have to mail whatever it is you forgot.

    Posted on October 13th, 2009 at 12:29 pm

  16. Veronica Said,

    I have great credit never been late on a payment , I did call the Bank to reduce my payments they did agree , my question to you is they did agree to lower the payment from 2,500 to 1,500 but they did mention they were going to report to the credit bureal as a partial payment , now would that affect my credit

    Posted on November 20th, 2009 at 4:07 pm

  17. John McConnon Said,

    I also have good credit. I recently have had a divorce and have had some hardship. I to applied for a loan modification an was approved right away. Then I read the fine print. The representative from Citi told me flat it did not affect your credit . He lied it does. It will be destroyed for along time believe me dont fall into the trap. If it is to good to be true it probably is. I immediately opted it out of the program. It was a nightmare trying to get out. I never signed thing. Then I spoke with another rep. he said we have a better plan for you where it is just a straight modificatiion for the life of the loan . He then told me I wasn’t elegible because I turned down the first modification. This program is the biggest joke. If you do a modification your credit will be destroyed and all your loans and credit cards interest will go to the max. You will be worse off than before but with bad credit and you will still have to pay the mortgage . That rate they give you only lasts for 5 years and the loan is stretched to 40 years. The banks aren’t doing are sacrificing a thing even though they were given millions in your tax dollars. The only people this will work for is the people who shouldn’t have bought homes in the first place. There lives are in shambles anyway so what do they have to lose. So once again if you do things the right way and actually care about your credit which is basically your word you get screwed. All that money the banks recieved and as of Sept. 1. 2009 350,0000 trial modifications begun . of that about 1700 permanent modifications. This is the whole country. One in 7 mortgages is delinquent or past due. This is a program mandated by the government. Yeah right. If its to good to be true it probably is. Unless you have nothing to lose this is the plan for you. Thanks Obama that was 200 billion dollars that was put to great use. The economy is thriving or so you say. Oh yeah its Bush’s fault. You have done more damage in a fraction of the time he could ever dream of. The banks just recieve a free gift of our money. None of that money is being used to help us the people. There are no penalties for the banks not following the rules. It’s busines as usual and they’re going to get their interes believe it and then some. I am gonna hold out for HAM 2 maybe it will be better. The banks just get richer well the rest of us try to find work while Obama throws the bigges parties the White House has ever seen on your dime. What the hell he’s got a taste for spending now. AVOID THIS MODIFICATION!!! IT’S A SCAM!!! IT WILL HARM YOUR CREDIT FOR EVER!!! The banks don’t care about your credit. All they care about is the bottom line their profits.

    Posted on December 11th, 2009 at 7:13 pm

  18. Bilal Said,

    For some people credit is not as important as having a roof over their heads and their families head. These are the people Obama intended to help with his program. So, if you are in a situation where you have to choose between shelter vs. credit, I would highly advice you to choose shelter.

    But, if you can afford your payment even after a hardship, and are looking for a small cushion and you qualifiy for savings under this program, then you may want to think twice. Is your kid going to college in the next few years and requires you as a co-sign for a loan? Would you be in need of a new car in the future? Do you need good credit score for anything in the short-term? If not, maybe having the small cushion is better than having a bad score. Remember, you score will improve over time.

    Posted on December 28th, 2009 at 12:07 pm

  19. Don M. Austin, Texas Said,

    This is scary stuff! I just lost my job last week and in an effort to be an upstanding citizen and pay my bills on time, I considered the Hardship Loan Modification Program. The more I look the more of a sinking feeling I get. My gut is telling me that this is a bad and misleading program. Once again the Federal government hasn’t considered the implications of its actions. They didn’t look past the banks, they just gave them the money. The banks are now the largest owners of real estate and have been given Billions not just millions of tax payer money AND the Federal Government printed money which devalues the dollar in a way that we have yet to understand. INFLATION, you’re going to hear that word a lot in the coming days and months I fear.

    In the late 80’s banks and Savings and Loans had every incentive to modify or do whatever they could modify loans and didn’t take it. Do you remember what happened? Banks and S&L’s dropped like flies and the RTC was born. House prices dropped and we all went about our business buying property at a lower price. Investing in real estate and the banks left were loaning the money. Within the next five to eight years, people and the housing market was on a comeback. None of that has happened this time…

    There are Billions of dollars in foreclosed properties being held by banks and mortgage companies and what’s happing to them? We’ve had banks go under but the assets didn’t really go anywhere? The percentage of foreclosure prices didn’t go down as far as I thought they would. For a time you could buy houses easily and the government helped first time home owners get their due. Which begs the question, just how toxic where those assets to begin with? It still looks like the prices aren’t down to where buyers are willing to buy them and you know banks aren’t willing to lend on them. So what’s the problem? The BANKS! They don’t need to do anything right now because they have what they want. An endless supply of money backed by the government at a very cheap rate. THEY DON’T NEED US! Not rocket science.

    I think at this point we are just going to hang on and make due. Yes I feel like I’ve been robbed and yes I have. I’ve worked hard for 35 years and now I have to start over, savings gone, investments worth less or worthless. I’ve been taken by unscrupulous people in government and in banks and investment. Doesn’t really matter which side caused it. I could blame them both and I still have less. Question is where do we go from here? Billions we will never see are being given out here, Trillions overseas. We should have thought to take the credit cards away from the teenagers before we gave them the car. Now we’re paying the bills. My New Years resolution is to see to it that my government representatives, and I say that with “tongue in cheek”, know who the hell I am and not in a good way! No worries, at least we have healthcare!!!

    No – we’ll probably not bite the hook dangling from the government bobber on this deal. The bank is on the other end of the line – and they’re in a feeding frenzy!!!

    Posted on January 7th, 2010 at 11:43 am

  20. patty Said,

    Question for Kay i had the same problem where i just pulled my recent credit reports and even though i have been paying on time for the trial period, it shows my current payments are over 120 days late!!!! Did you finally get them to remove the negative reporting to credit bureaus? I’m dealing with Chase and still waiting for the approval of my modification and continuing to pay on time.

    Posted on February 9th, 2010 at 1:06 pm

  21. admin Said,

    During the Trial Modification Period your payments are technically late-you are not making the payment that your original note calls for. Once the modification is made permanent then the credit rating will change to paid as agreed.
    This is a quandary for some homeowners trying to get a loan modification and not harm their credit-but usually the trade off is worth the thousands of dollars you save with a loan modification.
    The new federal guidelines now mandate that lenders must review all loan modification applications within 30 days and once a trial modification is completed, it becomes permanent automatically.

    Posted on February 9th, 2010 at 1:16 pm

  22. Susan Kay Said,

    We too are the result of a loan modification gone! December 08 we started the process to try and ease our living paycheck to paycheck. Citi advised us to make a reduced payments for 3 months as part of the trial period for a loan mod. for Feb., March and April. We did. Then came May, June and July. I was advised to continue making the reduced payment since our account was in underwriting. Then the Obama Nightmare came out. They reduced our payment for Sept., Oct. and November. This seemed like a good opportunity to continue to keep a roof over our house. Then again I was told to keep making the payments for December and January since again we were in underwriting.

    December 30th we received a foreclosure letter. Totally unexpected since I had been calling every two weeks for an update. Apparently to qualify for the program your house payment must exceed 31% of your gross income which ours does not. Yet, Citi lead us on for 13 plus months resulting in ending up in foreclosure.

    Anyway, we made every payment that during the trial periods and beyond that Citi told us to under the loan modification guidelines and now we are scrambling to keep a roof over our family. Praying for some kind of a positive outcome soon before we are out on the streets!

    Its kind of hard to understand that Citi is willing to foreclose on our house when we are willing to continue to make payments. All we are asking for is a reduced payment and tack the rest on to the end of the loan or extend our loan from 20-25 years. Also our 2nd mortgage in through them too, so they have even more to lose by forcing us to walk away.

    Posted on February 18th, 2010 at 5:14 pm

  23. admin Said,

    It is sad to hear that homeowners are being strung along and not given the correct information on their loan modification application. There are standard guidelines that the Treasury Dept has implemented under the HAMP loan modification plan-so if you know and have a good basic understanding of these guidelines ahead of time, you at least have a fighting chance of preparing an acceptable loan modification financial statement.
    Remember, the bank will make their decision based on what you show them, so it just makes sense to take the time to work on your figures to make sure they are acceptable.
    You should know your debt ratio, what your new target payment is and what your disposable income is so that you can make any adjustments before the lender reviews your loan modification application.
    This may sound difficult and confusing, but you can use a software program designed just for homeowners that will do all the calculations for you. The Loan Mod Quick App actually mimics the guidelines, so when you put in your own income and expenses, you will see immediately if you need to make any adjustments to your budget to fit into the approval guidelines. Sometimes, just a couple of hundred dollars adjustment can make the difference!
    Visit for lots of free, helpful information on how to prepare your loan modification forms. If you feel like you would like extra help, you can order The Complete Loan Modification Guide kit with Loan Mod Quick App software.

    Posted on February 18th, 2010 at 10:43 pm

  24. KDM245 Said,

    Hi – thanks for all of this positive information. Just so I am clear, for the several months that you are making a reduced payment, your credit is adversely affects… Once the plan is finalized, your account is brought current. Question – do the three or four months of reduced payments get updated so your credit is okay, or do they stay on your credit report for 10 years? Obviously a refinance is a better route for me, but I am just trying to figure this out. Thanks…

    Posted on March 12th, 2010 at 4:52 pm

  25. admin Said,

    A loan modification will rate as a “rolling” 30 day delinquency, which means that for 3 consecutive months you were 30 days delinquent. Again, this is because while you are making the trial modification payments you are not technically in compliance with your original note. Once the modification becomes permanent, then the payment you are making is in compliance with the new terms of your note, and you are now rated as current was 30 days delinquent.
    That credit rating is not a severe hit to your score, and will cease to be an issue at in about 6-12 months. So if you need a loan modification, the short term hit to your score is minimal and in most cases definitely better than other alternatives like foreclosure.
    Your credit score has probably already been impacted if you are facing financial difficulties and need a loan modification to stay afloat, so in most cases it does not become the deciding factor for homeowners.
    If you are not yet delinquent on your loan, then yes, your credit will be affected by accepting a loan modification and during the trial modification period your score may be affected. But unfortunately, you can’t have it both ways-a loan modification and perfect unblemished credit are contradictions.
    Each homeowner must decide on the best course of action for their particular situation-but make sure you know all the facts and understand the loan modification process before you make these important decisions affecting your home, credit and financial future.

    Posted on March 13th, 2010 at 11:34 am

  26. Celeste Said,

    I am going through a messy divorce we own a house together, my soon to be ex-husband have not live in the house in allmost three years, last year I applied for a loan modification with my mortgage company finally in early January I recieved an answer from my mortgage company which was great they approved the presidents plan loan modification. But my ex-husband found out about it and called the mortgage company and had it blocked. Now I have to take him to court and try to have the judge either take his name off or have him pay part of the mortgage. What do you think will happen in a crazy case like this one

    Posted on March 19th, 2010 at 10:17 am

  27. admin Said,

    If you have documentation from the court that you were awarded the house in the divorce. then I would present that to your lender. A loan modification is still available to people in your situation as long as you can document the circumstances. The bank probably won’t take his name off the mortgage without refinancing, and I am guessing you do not qualify for a refinance due to loss of value or credit issues.
    Stay on top of your bank and find out exactly what they want in order to let the loan modification proceed. There should be a way to do this!

    Posted on March 19th, 2010 at 8:40 pm

  28. eric Said,

    reading this blog is scaring me.
    i lost my job jan 09 and phoned b of a about a loan mod in oct 09 when i realized i wasnt going to get a new job so easily. they pre-qualified me on the phone and explaned 1-it would take 2 months to get the actual application mailed out. 2-then i would be put on a 4 month trial. 3-during the trial, the mortgage pymnt would include tax escrow. (which i normally pay myself) within one month, my monthly payment was increased about 30%. not decreased, as i expected. i have been paying this increased payment for 5 months so far and have never recieveg the actual application packet they promised. all the while, i have repetedly called them asking for the application. not one person that has picked up the phone at b of a ‘imminent default’ office, all these months, has been able to answer my questions. i have continued to pay all payments on time, as well as my property taxes, even though they are collecting for that. (someone in their office recommended that i continue to pay since they couldnt determine if they were actually going to pay it)
    i finally received the app package yesterday, but am scared to continue this process if its going to trash my credit. i have struggled successfully to continue paying all my bills since i lost my job. i think i can continue to do so.
    if i back out of the loan mod at this point, do u think it will affect my trw?

    Posted on March 23rd, 2010 at 4:08 pm

  29. admin Said,

    A Bank of America loan modification should not result in a higher payment-the whole idea is to offer an affordable mortgage payment so that your home will not go into default and foreclosure. Something is not right with your application. Did you request the HAMP program? Under that loan modification plan your payment should be reduced to equal just 31% of your gross monthly income. Are you working yet? If so, then take your monthly gross income and multiply it by 31-that will equal your new payment including property taxes and insurance.
    If you are not working, it is going to be hard to get approved for a Bank of America loan modification-they will consider unemployment benefits as income as long as you have 9 months left on it. The way you prepare your application package will in large part determine if you are offered some type of loan workout. It is critical to prepare your financial statement correctly so that you prove to Bank of America you fit into their guidelines for approval. Your debt ratio, disposable income, and other triggers will be used to determine if you qualify.
    If you are confused about how to do this, you can use a software program designed just for homeowners that does all the calculations automatically for you. Just input your own monthly income and monthly debts and your debt ratio, new target payment, new loan terms, etc are all done immediately for you.
    Visit for tons of free information, and if you decide you need extra help you can order the software program there too.

    Posted on March 25th, 2010 at 11:20 am

  30. John Wright Said,

    If it walks like a piggy, talks like a piggy, by golly it’s a PIGGY!

    BofA and it’s CEO Brian Moynihan reminds me of that song by John Lennon and George Harrison titled “Piggies” I invite you to listen to this song on youtube and see if it appropriately fits.

    Have you seen the little piggies
    Crawling in the dirt
    And for all the little piggies
    Life is getting worse
    Always having dirt to play around in.

    Have you seen the bigger piggies
    In their starched white shirts
    You will find the bigger piggies
    Stirring up the dirt
    Always have clean shirts to play around in.

    In their ties with all their backing
    They don’t care what goes on around
    In their eyes there’s something lacking
    What they need’s a damn good whacking.

    Everywhere there’s lots of piggies
    Living piggy lives
    You can see them out for dinner
    With their piggy wives
    Clutching forks and knives to eat their bacon.

    Wright vs. Bank of America Lawsuit at:

    When I filed my lawsuit against Bank of America, myself and United Law Group thought of the many others out there in the same situation. It was then that we decided to educate the public on what these piggy banks are doing, as well as unite us all together as one voice. Please help me turn this David vs. Goliath modification process, into a Goliath vs. Goliath.

    Please stand with me and United Law Group and send an email to Bank of America that states that we will no longer tolerate their potentially illegal, fraudulent, irregular and abusive business methods.

    Divided we might have fell America, but united we must stand!

    Please send your email directly to Bank of America and include the following:

    1. Your name
    2. Your complaint concerning your experience with Bank of America.
    3. Please end your email “I support John Wright vs. BofA Lawsuit!”
    4. Please send a copy of your email to
    5. Please send your email to both BofA link below and the CEO email

    BofA Linked Email:

    CEO Brian Moynihan:

    Matthew Task, Executive Relations
    Office of the CEO

    Posted on April 19th, 2010 at 12:25 am

  31. Rebecca Said,

    We were looking to modify our existing home loan with Chase and got no where. Someone suggested we go a month behind on our payment and in doing so we had our payment modified. It took about 6 months from the first payment being behind. Hope this helps!

    Posted on April 30th, 2010 at 3:39 pm

  32. John Wright Said,

    John Wright vs. Bank of America

    Please feel free to comment at with your complaint against Bank of America concerning the home loan modification scam. You find many of us there uner the John Wright story.

    Posted on May 8th, 2010 at 11:05 pm

  33. Milu Said,

    I have bacnk of america!!UGH! so frustrating!! I requested for help last year in Nov. I still havent received a status on my modification. One department tells me to keep on making my payment and the would help the person reviewing a good impression that I still want to make payments….then when I call earlier this year it said I didnt include some information when I sent it to them like 5 different times because everyone was giving me a different fax number. really frustrating! then come to find out I have no idea where my documents were going! Finally I get a fed-ex request stating that I need to send all the information that was asked prior again. I called wondering how come they havent received all my faxes??! Then they said that those dont count because they need originals,what?? then why ask to fax it!? Everytime I call to check on status they keep telling me I have to call in 2 weeks. Then one time I called I ended up talking to a surpervisor, which she stated that she couldn’t do anything for me since I was currect on my payments!! Paying my mortgage ontime justifies to them that I dont need help! bunch of crap! I have other bills that are pilling up, i need help that is why I applied! So basically she is telling me not to make payments in order for them to help me, but then on the other hand they call to harrase you to make the payments on time. this is ridiculous!!

    Worst customer service ever!!

    Posted on May 18th, 2010 at 1:26 pm

  34. dawn Said,

    I live in Indiana, I am very ill and my medical bills are through the roof recently. I have rung up about 40k on credit cards for prescription meds. My husband works in construction – Tile and has been unemployed for over a yr. Unemployement has ran out. He took a nothing almost minimum wage job to bring something in. It is devastating. We have paid our mortgage payment but we are right there on the edge. Each month it is getting harder to make the grace period. I don’t know how long I can make it? We have cut all I can see. When we saw that the employment market was getting bad for my husband about 16 mos ago, I went to chase our mortgage holder and tried to refinanance. I just wanted to lower the rate and ret rid of the second of 22k that was rung up for medical bills. They lowered the value of our home huge! They drug their feet and screwed around and did 2 estimates on our property. They took the lower which was a drive by?? What the hell is that? A drive by? Can they do that? Anyhow, I see all the problems everyone is having with the loan modification process. Is this for real Obama? Where is the support and help? It scares the crap out of me? I am very ill and just don’t have the energy to deal with this but, if I do the modify it will help us about 400 to 500 a month and we can start to lower the other debt? Can ANYONE, ANYONE…. tell me how bad it screws your credit? I have good credit expect for the fact the debt to income ratio is screwed now because of the medical problems. and can anyone tell me if they did the process and survived it? Are you ok now? Is it a good thing or all trash talk? I cannot stress anymore over this stuff and if it is such a terrible process it may not be worth my health? I am scared and need to do something? I cannot pay for the medical stuff let alone the mortgage. Something has got to give? I don’t see a way out? Oh, my house was bought for 260K we owe a little less than half but, chase came back with their “driveby” and valued the home at 180k we put another 40k into. I wish hind sight was really 20/20. Can someone just share something positive through all this if there is such a thing? I need to get some good info to move forward or to just walk away from it all? Thanks for your time and consideration.

    Posted on May 20th, 2010 at 9:25 pm

  35. dawn Said,

    Rebecca… I just saw your post… How late did you go on your payment and how bad is it a mark on your credit?

    Posted on May 20th, 2010 at 9:27 pm

  36. admin Said,

    A loan modification will have an impact on your credit-even if just for a short while. The fact is that when you change the terms of your original loan agreement and make smaller payments, you are no longer in compliance with your note. Therefore, your credit will be impacted with late payments while you are making that smaller payment. Once the modification is made permanent, then you are back in compliance and your loan will begin rating paid as agreed again on your credit.
    In the big picture, what is more important? An impeccable credit rating or saving your home with a loan modification and low, affordable payment? If your home goes into default then your credit will affected a lot more drastically than a loan modification would have.

    Posted on May 21st, 2010 at 10:44 am

  37. admin Said,

    Trying to get a Bank of America loan modification can be extremely frustrating and confusing for homeowners. This is especially true when every time you call in you are told something different and the items you send in are lost or never received.
    There is actually a system in place that can streamline the Bank of America loan modification process. Homeowners who know just what to expect, how to complete and submit their application properly will have the best chance of getting a quick answer. Think about how much time and effort most homeowners put into learning about the loan modification process and figuring out exactly what the approval guidelines are-usually borrowers will simply call into the bank and disclose all of their financial information without any pre-qualification or work on their budget.
    This is taking a big chance with your Bank of America loan modification approval-your application must prove that you fit into a small box of approval guidelines-this is actually a standard mathematical formula-so it just makes sense to learn and use this formula so that you know ahead of time how to fine tune and adjust your financial statement to fit the guidelines.
    Your loan must be able to be modified using standard terms and methods, so if you are not sure how to figure out this formula, you may want to use a software program that actually does all the calculations for you automatically.
    The Loan Mod Quick App will figure your debt ratio, new target mortgage payment, new interest rate and other very important calculations. You can avoid mistakes and improve your chances of a Bank of America loan modification approval when you use this helpful tool for homeowners. Read more free information on

    Posted on May 21st, 2010 at 2:43 pm

  38. Jim Said,

    Our credit was fine. We were not behind and had never made a late payment. I lost my job and had to take a lower paying job. We called citi-mortgage about the modification loan. One of the things that was said was, ” you’re not behind on your loan”. We explained, no we weren’t, but that we were now having to spend savings to make our payments and it was just a matter of time. We completed the paper work and were told not make a payment the next mont and then to make a reduced payment for 3 mos on a trial basis and then they would look at our situation again. Well after the trial basis they told us to repeat the process again. At the end of this process our credit was screwed up. They showed us as behind on our payments and owing the difference in the payments as well. We had not missed a payment, had done as directed by them, were penalized and our credit was ruined and were still not approved for the modification. We started getting letters saying we owed all this back money and were behind on our loan. We stopped making payments and were finally approved but no credit now. This is really screwed up.

    Posted on May 29th, 2010 at 8:25 am

  39. Dianne Said,

    Hi: I live 10 minutes east of Raleigh, NC. I purchased my townhome on May 31, 2006 at the age of 47. I was never late on a mortgage payment till the middle of 2009. I lost my job in Nov. 2008 and I finally got a job in Feb. 2010. I was out of work for 15 months. US Bank offered me 4 months of half payments in 2009 and they offered me the same thing this year from Feb. – May 2010. This has obviously affected my credit since it shows me as being late for a total of 4 months. Effective June 1, 2010, I will be on the FHA-HAMP. I have to make 3 payments on time during the trial period. The new loan is for 30yrs and at the end of the 30yrs, I will have a balloon payment of $20K due. My mortgage has been reduced from $1152/mo to $923/month on the FHA-HAMP. Is this modification good or bad? I didn’t want to lose my townhome. I absolutely LOVE it, my neighbors and my neighborhood and I finally landed a job I love! My question is….does US Bank HAVE to report me as late during the payment plans they put me on in 2009 and 2010? If so, can they remove it since I will be on the FHA-HAMP? I need a new A/C unit and because of the hits on my credit report with US Bank, I was denied. I even tried to trade in my car and get something smaller and more economical but they said I would be approved if US Bank wasn’t dinging me. Does anyone know if the government put something in place for people that were never late prior to the economic downturn and got help from their mortgage company so their credit report can be adjusted or if they can put the late payments at the end of the loan as my credit union did with my 4 car payments? Please advise. Thanks and God bless!

    Posted on May 31st, 2010 at 10:50 am

  40. Dawn Said,

    Thanks for the info.It sounds like when and if the process to get you going into the loan modification works than over all it is a good thing. Has anyone had trouble with CHASE bank? I tried before my husband was let go with the construction firm to refi. Just a regular refi. Chase screwed around with me and drug their feet to where we could not qualify. They came back with the first appraisal ( someone looking in and out) came back pretty good. Chase said they wanted another appraisail BUT, a DRIVE BY? I still ask myself what the heck is a drive by appraisal. Well too me not fair for suire besides nutty. Well the appraisal came back 60K less. Then at that point I said they could pack it. I lost the $300 appraisal fee. I should have asked if I could write it off for the heck of it?! I am just nervous about them jerking my chain. I have good credit. This house we bought after selling in Calif and making a good profit. I put 110K down on it and morgaged 140K When I had a bunh of $$$$$$$$$$ in the bank they liked us and were our friends. They would call us and check on us. NOW HAHAHAHA I am nothing. If anyone knows about chase I would love to hear from you and your situation. My husband wants me to try to do a regular refi with First Horizon. He thinks because houses are selling we would have a shot. I don’t think so. I am barely making the 1200 a mos now. I don’t have the fees and heard NOT to roll them into the loan. sounds good???? I don’t know anymore. This all stinks. I wish everyone here good luck and well wishes in your enderavours. Take care…..

    Posted on June 1st, 2010 at 10:41 pm

  41. admin Said,

    A Chase loan modification does not require any appraisal or that you have equity in your home. In fact, you are a better candidate for a loan workout if you don’t have equity! You have been trying for a refinance to lower your mortgage payment, and since the lender requirements now are very stringent, it is no wonder that you are having a hard time.
    A Chase loan modification may be another option for you to consider as this program will also give you a lower monthly payment and change the terms of your current loan. The difference is that you do not get a NEW loan, instead your current loan is modified so that you can afford the monthly payments.
    A chase loan modification does have certain qualifications however, and you must submit your application for review and consideration. Chase is participating in the HAMP program under the Treasury department, so if you can meet the standard guidelines you may have a good chance at getting your current loan modified.
    Just be sure to learn what the guidelines for approval are and prepare your application correctly-this is something you can do yourself with just a little bit of research and preparation. You can also use a software program that actually mimics the HAMP guidelines so that your paperwork is completed properly and you know how to adjust your financial statement to meet the guidelines.
    To learn more about HAMP and the loan modification process, visit There are hundreds of pages of FREE loan modification information and also the software program.

    Posted on June 2nd, 2010 at 10:44 am

  42. admin Said,

    When you begin a U S Bank loan modification, you will most likely be put on a trial modification-during this time, you will be required to make the new lower mortgage payments for at least 3 months to see if you are able to comply with the new modified loan terms. Keep in mind that until you complete this trial period, you are not in compliance with your original loan terms. Therefore, U S Bank can and probably will report you to the credit agencies as delinquent. Once your loan modification becomes permanent, then you are back in compliance with your agreement and your loan will begin rating as current again.
    If you are more concerned about your credit rating than trying to get a low, manageable mortgage payment then a U S Bank loan modification may not be for you. However, your credit rating will recover fairly quickly once your loan is permanently modified, and the overall impact will be minimal compared with the damage that can be done with a foreclosure or deed-in-lieu.
    If you need to learn how to apply and qualify for a U S Bank loan modification, then please visit for hundreds of pages of FREE information that will help you qualify for a loan workout. You can also take advantage of a software program designed just for homeowners that will help you prepare an accurate and acceptable modification application.

    Posted on June 2nd, 2010 at 5:15 pm

  43. Steph Said,

    I have been in the process of a loan remod through Chase. I have an approval with the caveat that I make three months of payments (which is actually higher than my original) but includes taxes. I’m making those payments. I, however, didn’t realize they weren’t remodifying both my 1st and 2nd (which is with the same bank) and haven’t made my second this month an am getting HOUNDED by chase. so, should I continue to try to scrape to make my second? It looks as though this is going to affect my credit rating anyway. I’m so lost! any ideas?

    Posted on June 17th, 2010 at 1:25 pm

  44. admin Said,

    Since your first has been approved for a Chase loan modification, then you need to submit an application to have your second loan modified as well. Under HAMP, your second loan is eligible for modification if your first qualifies-which it sounds like it did as you are on the trial modification now.
    You need to put together an application with the same information that you did for the first-except change the loan number obviously-and contact the second dept. at Chase and request a loan modification.
    Explain to them that your loan modification is approved and your first loan and that you want to get a HAMP modification on your second as well.
    Make certain that all of your figures on your application are accurate and that you provide them with all of the documentation they need-this may seem like duplicate work but the two departments do not speak with each other.
    If you would like more information on how to correctly prepare your application and get more information about loan modifications, visit

    Posted on June 18th, 2010 at 10:40 am

  45. Eric Said,

    Ok, I understand that if you apply for the HAMP you go through a probationary period where you pay less than the original payment, but what happens if you during this period you make the original payment and when the modification goes into affect you pay the lower agreed upon payment. Will this still deal a blow to your credit?

    Posted on June 29th, 2010 at 12:18 pm

  46. admin Said,

    The HAMP trial modification period is designed to let the investor/lender know that you can afford to pay and maintain the new lower payment and that you will not be a risk for default once the modification is made permanent.
    If you are able to pay the original payment, what message is this sending to your lender? If you can afford to pay the normal payment, why do you need a HAMP loan modification? I personally have never heard of anyone doing it this way so I cannot give you first hand advice, but it sounds like a risky strategy to me.
    Remember, the first qualification for a HAMP loan modification is a financial hardship situation causing your current mortgage payment to be unaffordable. The plan is not designed for “strategic defaulters” and has built in triggers to eliminate those borrowers who are really in a financial bind but want a lower payment or loan balance due to market conditions.
    A HAMP loan modification has standard guidelines and approval criteria, you must be able to meet these guidelines and fit into a mathematical formula used for modification.
    If you want to learn more you can read more pages of blogs and get information on a software program that mimics the federal guidelines at: There is a ton of free information and also a resource guide available to help homeowners qualify for HAMP.

    Posted on June 30th, 2010 at 10:51 am

  47. Alex Said,

    Based on my readings here, I see banks reporting 30 delinquents if you are on the trial period, which negatively affect your credit score. I just called Chase and they said they only put people who are already delinquent on the trial and people who are current and been making their payments, permanent, however, they still report to the credit beaurals that there has been a loan modification by the federal government.

    Has anyone done this where they were put permanently instead of a trial and checked your credit score before and after it has been done? They are unsure how much it lowers your credit and that is what I want to know.

    Posted on July 15th, 2010 at 5:29 pm

  48. admin Said,

    A loan modification will almost always affect your credit score to some degree. I would have to question the answer you got from Chase as it is not accurate that only borrowers who are late on the payments are put on the trial modification. The federal guidelines MANDATE that the 3 month trial be implemented, and then after the homeowner completes the trial period the modification can be made permanent. It can be confusing and frustrating speaking with the banks, as each time you call you may get a different answer depending on who you talk to. Unfortunately, alot of misinformation is given out to homeowners by bank employees who are simply not trained enough. Also, sometimes they just tell you what you want to hear because they are tired of being yelled at all day! The Federal HAMP guidelines are clear and lenders only get reimbursed for those loan modifications that follow the guidelines. In my opinion, a small, temporary decline in the credit score is a fair trade off for new lower loan terms that help you keep your family’s home.

    Posted on July 30th, 2010 at 7:26 pm

  49. Arcady Said,

    I just received an offer from Chase to modify my loan for the second home I own. they inherited this loan from WAMU after they acquired them. I am current on my payments, employed and have an excellent credit. I called yesterday to find out how they report this to the credit bureaus and their rep, who was actually quite rude, said – we report it as loan modification and it will be a new loan. He bluntly refused to give me an answer if I can get a letter stating that it will not be reported as a “charge off”. His answer was – here is our offer – take it or leave it!. I have serious doubts that I will take their offer now… Even though the terms are fine and the payment seems reasonable, I think they might be violating federal guidelines for offering me a modification. I also am afraid that they will list me as delinquent on my current loan even though i have not missed or have been late on my payments EVER.

    Posted on August 5th, 2010 at 9:26 am

  50. kD Said,

    Just so you know,,,,the lender BOA called me with the modification program. (they approached me…their idea) Almost a year ago…I submitted all the paperwork. In March of 2010, got a fed x package saying the mod was approved, docs would be sent. Never got anything.Never heard another word from them. I am not behind on my mortgage payments. Never. I am 43 and there is not one negative on my 19 page credit report. I chose during the “trial period” to pay my full mortgage amount. I thought that this would avoid any possible problems with my credit. Wrong. I applied for a student loan for my son yesterday. Declined. That has never happened to me ever. I immediately got a copy of my credit report. My number is down..but still 750. There are no lates shown anywhere. BOA does report partial payment being paid. (even though its not.) called BOA….too bad. My choice ..according to them. is to cancel the whole modification process and then they would fix the credit. So…i have no idea what to do now. The student loan company could only tell me it was declined due to severe delinquencies. What??? There are not. Bank of America is a circus. Everyone that is employed there is a clown. People should boycott Bank of America. There needs to be a class action suit filed against BOA. Show me where it says even if you paid your original mortgage…they could report it as a delinquincy while they screw around with your file then do nothing in the end. I would NOT get involved with this. Its a mess and they wont do anything for you in the end.

    Posted on August 11th, 2010 at 4:30 am

  51. LG Said,

    Just want to give a shout out to Chase. There is a lot of negative criticism of them, and I admit it took a while! (13 months) but if you are persistent and stay with the plan, and turn in all required documents in a timely manner, you can receive help from them. Remember, in most cases it costs the bank more to foreclose than to work with you, but in fairness to them, they are being bombarded with modification requests. Be patient, give them the information they need, make the trial payments, be open and honest about your situation, and hang in there. Last month, I received my loan modification from them and I can finally breathe easy. I’ve had my shares of scary letters and a seemingly lack of communication between me and them, and between their departments, but they did come through for me. If you are in the process, hang in there.

    Posted on August 24th, 2010 at 11:24 pm

  52. JA Said,

    I have filled out all the paperwork that Chase requires for a loan modification and have been told by them that they will send a negative report to the Credit Bureau that my loan was NOT “Paid as Agreed”. I have nothing derogatory on any of the 3 reporting agencies as I pay everything on time as agreed. At first I thought it would be no big deal but then knowing how credit card companies change terms (interest rates and/or limits) I am now having second thoughts. Has anyone gone through the loan mod process and had a negative rating reported? How did this affect your credit cards?

    Posted on August 26th, 2010 at 1:33 am

  53. Dan Said,

    Hey DeboraH I got approoved for Loan Modification with Chase .. email me at if you want some info!!

    Posted on October 11th, 2010 at 2:23 pm

  54. One disgruntled American Said,

    Let’s see here, where do I start? I purchased my home in 2007 and was never late on my payments. In 2008, I lost my job and after coming back from a deployment, had no other choice but to take a meager paying income job. Well fast forward to 2010, after some medical problems and accumulating medical bills, I had fallen behind on my housing loan. I applied for a modification from Bank of America, and they denied me saying that my application did not fit the criteria for a modification. Well my credit is now in the crap due to me being behind on my house payment. Now the Bank Robbers of America want to constantly call me asking me when can I pay them. I tell them I do not know since I was told I do not qualify for a modification asking for help temporarily until I find a higher paying job and if I only can deploy again. Oh no, the wonderful folks at Bank of America tell me that they do not know when they will be able to help me again until I fall within their criteria which is a bunch of crap!

    They got bailed out and do not even bother to help those that need it? They only people getting the help are the ones who don’t need it which is those folks up there on Wall Street. I guess the working people are being screwed over the best way they know how. Working for the government I do not make as much as I used to yet, I can’t get the help I need temporarily just until I get on my feet again. Thanks so much for this wonderful healthcare plans that are out there and those who make over $100,000 a year getting bailed out, those on the bottom got sold out. Thanks a lot for this wonderful plans that are totally useless…….

    Posted on November 15th, 2010 at 10:28 am

  55. Lydia Said,

    Hello I just got my loan modified from 6.75% fixed rate doen to 2% 1-5 years, 3% 6th year, 4% 7-8th year and 4.25% for the rest of the loan.. Yes they did strch my loan to 40 years and I was 12 payments behind all those payments will be put at the end of my loan or when I sell or refinance I will need to pay it back. The reason I defaulted so much is due to my hardship of reduced income and while my loan was current the bank would not work on my account. Yes it hurt my credit drastically however the bank will report this to my credit as current and with the new low payment I will work on getting it back to where it was.. Good Luck it is time consuming many calls and a lot of paperwork included but it is worth it

    Posted on December 1st, 2010 at 9:39 am

  56. Gary R Said,

    I hope that you can help me with my questions because I’m very concerned. I purchased my in 2009 and I have never paid it late. I started to consider a loan modification program but I’m concerned that my credit will suffer. I tried refinancing however I was denied because I don’t have a 640 FICO score. If I do a loan modification will this cause my credit score to go down? Bank of America provided zero help. Each time I call someone told me something different. Is this somwething I can do on my own or do I need to go thru one of the agencies? Ultimately if this is going to ruine my credit would I be better off filing for bankruptcy? At lease in this case I would have a fresh start by cancelling my super high interest debts. I just need a solution because right im struggling to make ends meet. If you could give me some gudiance I would greatly appreciate it. Refinancing would have been the solution but that didn’t work out too well.

    Posted on December 7th, 2010 at 5:02 pm

  57. Cindy A. Said,

    Dear ADMIN,

    First, thanks a lot for this lovely blog and the application recommended.

    I just listened the senator on Yahoo!Finance regarding HAMP failure and he mentioned that the program was designed to target 3-4 million people but actual target is 7-8 hundred thousands. I got an impression that government/lenders or even services loosen the rules for qualification or approval.

    I would like to have the source of your statements to make sure before accepting WF’s trial modification. You stated earlier that “The new federal guidelines now mandate that lenders must review all loan modification applications within 30 days (I heard this somewhere else as well) and once a trial modification is completed, it becomes permanent automatically.(never heard this until now)”

    After reading all the horror stories, If I go into trial and get denied after several months, I will also loose refinancing options with lower rate a long with my good credit since I am current but having financial troubles.

    Could you please assure us that every trial period becomes permanent after 3 months of trial period? Cannot they repeat the trial period or extend the period several months more?
    If they can, what trigger repeating/extending trial period? If they cannot and make trial pemanet, could you cite any binding source of statement which makes you think “every trial period goes into permanent after 3 months of trial period as a new rule”?

    Your statement from February 9th, 2010:
    Admin says: “The new federal guidelines now mandate that lenders must review all loan modification applications within 30 days and once a trial modification is completed, it becomes permanent automatically.”
    Thanks a lot.
    Cindy .

    Posted on December 30th, 2010 at 11:55 pm

  58. Liset Said,

    Hello, I can tell for my own experience, that Loan Modification affect our credit, at least our lenders told us that will be like this for a year after the modification was completed, this is our six months already after the modification and we wanted to aply for a house loan for investment now that the prices are going down, but the credit is reflecting delinquencies in our mortgage.We called our Lender and asked them why is this happening and they told us that we have to wait until the year after the modification is completed of course doing the new payments on time.Before we were strugling with payments, we were using our savings, first we were denied, but the only way they can put us on a modification was entering us in a trial period.I hope this help.Good Luck.

    Posted on January 12th, 2011 at 1:27 pm

  59. char Said,

    Hello, April 09 I called Chase to refinance. I was never late with mortgage payments. I was talked into the Loan Mod Program I have a serious injury following surgery in 2005 which prevents me from working. I met the criteria for the “inhouse Program” and the Obama Plan according the rep from Chase Bk. I asked her about these plans and she replied “We will not throw you to the wolves, we have many plans.” This was the beginning of a nightmare that is still going. My credit scores are showing 120 and 150 days late. 6/18/11

    I was called by Chase Loan Mod Dept, and was told to miss a month to qualify. I had no reason to doubt whatever a bank told me. I have regretfully learn different. I thought this would take 30 or 45 days.

    It went on the pretrial partial pymts . They took over my real estate taxes which I previously paid on my own. This meant that the suspence account took longer to record a current pymt. This plan was dragged out from April to Nov. I was offered an “inhouse plan” at the end of Nov. Then Chase called and offered the Obama MHA plan 3 days later. I was very concered since equity in the house was more than the mortgage. IIt was obvious that I was being railroaded into default if they made an error or denied me the MHA plan. Chase could have sold my house and kept the equity which was more than the mortgage.

    There is a sentence in MHA document brochure that stated if I was not approved or denied the MHA plan, they could begin selling the house immediately and Do Not Have to Inform you. I received this in Dec 2009. I was told not to make a pymt for Dec. if I chose to since the 3 mo MHA trial beginning in Jan did not have the payment amt set. I did receive in Dec 2009 and made my first and last pymt in Jan 2010. I took out a reverse mortgage and paid off Chase. I lost equity since there are fees involved with a reversed mortgage.

    I know that I did the right thing. The mortgage was paid off the first wk of Feb. 2010 and in the middle of April, Chase Loan Mod Department called me 5 days in a row, different callers asked for financial papers to modify a loan that I no longer had with them. One caller even asked me the condition of my home. These calls were supposed to be recorded for quality control. I do not think anyone at Chase listened to these “recorded calls.” So much imisinformation and adliving by bank employees.

    I have my credit runied showing 120 to 150 one of the bureaus as late. This really hurts since I was never late prior this. Chase sent me a letter stating that I was never in foreclosure and the three credit reports show this. That is not true. They are asking for proof of payments. I kept the receipts, I cannot refinance with this showing on my credit or move to a smaller townhouse. Chase keeps referring to the Loan Mod Program to correct this. Chase has no record on their data base to reflect Loan Mod Payments (I guess). They are only able to pull up my previous mortgage payments. Their records show paid in full.

    Could someone comment on why the Customer Loan Dept all during 2009 and 2010 did not have access who was in the Loan Mod Program. Now, my :Branch Chase Bank told me today June 19, 2011 that they can only pull up my payments prior to the Loan Mod in 2009. I called the Loan Mitigation and they can only give me something like 500 and some days late. Chase Home Finance deserves the “F” rating they know have with BBB. Chase bk still has an A plus rating. I am still baffled that no one can read pymts made under the Loan Mod made in 2009. I am going to fax over all my payments made during the
    trial period.

    Posted on June 19th, 2011 at 2:22 am

  60. N Said,

    $450.00/month mortgage

    $450.00/month real estate taxes PAID SEPARATELY

    $65.00/month homeowner’s insurance PAID SEPARATELY

    Balance on loan is approximately $63,000.00. Home is appraised for $270,000.00

    One spouse unexpectedly died in 2009. Surviving spouse is 65 and disabled and income is $1,114.00/month of social security disabilility. Credit score is over 800.

    (Surviving spouse was beneficiary of few small life insurance policies which was able to tide her over until now)

    Based on the 31% ratio of $1,114.00 monthly income, that would leave payment of $345.34 – less than just the taxes and insurance. What options are there?

    Posted on September 12th, 2011 at 11:11 am

  61. Barbara E Said,

    They all deserve a slap of bad customer service and and IOU to all their customers.

    The very plan that was to help homeowners after banks got bailed out returns nothing but a boat load of Americans with BAD credit scores — I could however understand a ding on your credit, but for all the months waiting for the mod and than during the mod is rediculous.

    I hate my bank so much – they have put the final nail in my coffin.

    A tent in the woods is looking better every day.

    Posted on October 25th, 2011 at 2:18 pm

  62. Barbara E Said,

    PS if you go to Wells Fargo, or are dealing with Wells Fargo, bend over and kiss your behind good-bye.

    Posted on October 25th, 2011 at 2:19 pm

  63. car title loans rock hill Said,

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    Posted on November 4th, 2011 at 7:46 pm

  64. Fix my Credit Score Said,

    Tremendous issues here. I’m very happy to see your post. Thank you so much and I’m having a look ahead to touch you. Will you please drop me a mail?

    Posted on November 16th, 2011 at 1:29 am

  65. Lee Greatful and Modified Said,

    Thank God, after filing for a loan mod. since March of 09. We finally received a Mod. by asking the State Congressman Office to help us. What’s so great about that is, if you have paid your income taxes, the services are free. My wife and I almost hired an attorney for $4000 to help us, but by meeting my neighbor while at my mailbox, he told me that his loan was modified through the state congress lady’s office before she was voted out of office.
    Yes, we were behind on our payments by three months, and could not get the mortgage company to cooperate with us. They did not tell us what we were missinga far as paperwork. I also started recording their phone calls. They did not apprciate that at all. But, they were recording me, so I decided to record what they were telling me. Because, their collection company was harrassing us, and that is against the law by calling more than once in the same day. Anyway, I hope this will help someone. Just fax every letter from your bank to the congress person’s office, and allow the congress staff to be your go between, and you won’t have to talk with your lenders again. God Bless You All

    Posted on November 26th, 2011 at 3:13 pm

  66. mary Said,

    I stared my mod on 2010. how ever I never paid late or left payments behind, and in june 2011 they gave me a forber plan, that went for 3 monts, my existing mortgage was for 2700, and rate was 5.8 close to 6% and the forber plan was for 1600 for three monts. and on september2011 they send me the trial for an other 3 monts until jenarury ill get the modification. but I check my credit yesterday, and I have 4 late payments. but im very upset, because I was never late not even before that I had hi payments. and I have the cashier cheks, and overnigth paiper that they sing on every 1 of each moth.can some one tell me wat should I do before they close the deal and forget me for ever and dont give me letters to remove the late payments????.

    Posted on December 1st, 2011 at 2:11 am

  67. mary Said,

    ps. I forgot to said that the last 3 months of trial the payment went from 1,600 to 1,410 and the whole game trying to mod was because the payments were to high and i was thinking lowering the payments, and rent it, because I dont like the area anymore and buy an other one better area and biger, but with this situation I dont know if I can ):

    Posted on December 1st, 2011 at 2:24 am

  68. Jason Said,

    Thank you all for the great info…. many people commented on how thier credit card rates went up or the balances were lowered or the cards were closed due to the modification of thier home loan. I didn’t see anyone comment on whether that is legal or if it commonly happens. Can anyone give some advice as I consider modifying my home – which is currently at 70% of my gross income after a divorce ! I have a room for rent :-)

    Posted on December 2nd, 2011 at 5:47 pm

  69. renee Said,

    After two years and 3 months, we finally got a loan modification from Chase that reduced our mortgage by approximately $16.000.00. It took a lot of patience and many time we wanted to give up. I have a book of paperwork I’ve sent them and it was often lost or we were dropped from the program because they claim they never received a document…it was a mess. We were dropped from the program 3 times and was even told we were dropped because the phone numbers we had on file were do not call numbers. I felt like they wanted me to give up, but I refused expecially when in the beginning it was so unorganized and every month our file had been given to another representative. The best advise I can give is to keep a book and log sheet on all the documents you send and the name of the person you spoke with. Stay on top of your phone calls and even is they drop you from the program you may have other options. We didn’t qualify for the Obama program, but Chase had a program that worked for us. Good luck.

    Posted on January 23rd, 2012 at 6:02 pm

  70. katie Said,

    I did a loan modification last year, it took me about 8 months to go thru the process. I applied the first time and they denied it, and i believe it was because my income was not enough for the 31% of income for only mortgage. Then i applied again and made some adjustments to the paper work, i claim that i had renters which was my mom and husband which they included as an income and send some checks that i received for rent from them. Around a month later they qualified me for a 3 month trial. i did all my trial payments on time. By the way all the time that i was thru the process i did not miss a payment ever. Still kept doing my original payments until i started paying the trial payments which was $800 less. So i kept doing my trial payments until the 4th month because the underwriter was still reviewing my application. then i got a call from the eminent default from Chase and they told my i had qualified and they were just waiting for the underwriter to send me a letter. By June it was my first modified payment, which i took initiative and sent the payment before June 1st. 2 weeks later i received a call stating that i had not done the first payment. all day was doing calls to the bank thru all this dept.: customer service, eminent dafault..etc. and then at the end they informed me that the check was on hold thru the eminent default department, don’t know why. So then they stated they will cash it and clear it off. i ask the customer service if this will affect my credit and she said no.

    I just check my credit score 2 weeks ago my scores where not affected at all, actually i had higher scores than ever, don’t know if this had to do with me paying off my car. But i have a friend in the lender side for homes and she said that the banks when they check your credit report they go thru other agency which i have never heard about. and she checked mine and found out i have a delinquency to be dispute thru Chase. So i suppose it was related to what had happen thru my 1st month payment. I called my bank and they suggested to fax a letter to the research department to research why i have that claim under my credit report. I did as they said 2 weeks ago and i just received a letter that my payments have been on time and that they will clear it off with the credit beaureus.

    the point is that you have to insist and be calling the banks, and will suggest to be polite. i know is hard but that way you get more help from them.

    Posted on February 1st, 2012 at 9:00 am

  71. mary Said,

    We applied for a modification with Chase when we found out our broker not only got our 2 loans broke apart (never finished when we questioned the first) to stop the surprise balloon and interest only status we didn’t know we had. We stayed current on all payments. They gave us an in-house for 7% in 2008 during the meltdown, which took two years. Then we had a layoff for the next three years. Due to the job loss we reapplied for more reasonable rates. Two years later they got us into a different type of modification and wanted us to make trial payments. We refused and continued to make the full payment. It’s a 2% for 2 years, a 3% for three and a 5% for 20 more. We have been paying now for 8 years and will have a balloon again of a very large sum in addition to the expensive interest only payment on the second. It is now a 40 year mortgage at least and is worth 50% of what we paid for it including the costs to complete the basement and yard which we did before the mess to generate equity. Yes they reported it to our credit. It took a lot of very hard work, paperwork loss, incompetent phone personnel and several letters to the attorney general to keep us in a home that is in essence a financial death trap. We will never be able to retire or get out of debt like this and it has created a stressful home life and a contrary set of circumstances in which my spouse and I will never agree upon. Home was bought by one party not two as the state of MN allows. However, the non-buying spouse is legally responsible. It is a sad state of affairs when we ruin the very people who are fighting to prop up the bankrupt USA.

    Posted on March 4th, 2012 at 12:33 pm

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