Those blasted Banks!!! @#$@#

Trying to get a home loan modification? Frustrated by the lack of communication by the lender? You’re certainly not alone!

Does this sound familiar: “Hello Mr. and Mrs. borrower, we are considering your request for loan modification under the HAMP program. Please provide updated documentation: your last 2 months of paystubs, checking and savings account, retirement accounts and financial worksheet along with your hardship letter.”

Ok, that’s not so bad. But what IS bad, is that this is the THIRD time they’ve asked for the same documents! Since the bank has taken 6 months to sit on your last volley of documentation, of course those documents have expired…that’s how time works.

So a vicious cycle has begun. You, as the homeowner provide the financial documentation, send it to the bank, the bank sits on it; then several months later, the bank ask for the same revised documents. Rinse and repeat. Isn’t this the definition of insanity?

Here are a few tips to help ‘ease’ the frustration of applying for loan modification:

1. Don’t delay! It is possible to apply and get approved for a modification without missing a payment. Here’s a quick quiz from the horse’s mouth regarding eligibility for a loan mod. (the horse being Uncle Sam).
2. Account Numbers. In all honesty, lenders are getting deluged with applications for loan mods and short sales. Yes, they should do a MUCH better job keeping track of received paperwork (This issue deserves a whole blogpost on its own!) But to help your paperwork stand-out, please put the account number(s) of your loan at the top of every page you fax. In case your coversheet get’s lost (and they do), they’ll at least be able to tag the rest of your documentation.
3. Submit Complete Paperwork Package. Lenders are notorious for rejecting your application if it is incomplete. You may feel you don’t need to submit a document because it doesn’t apply, or is too personal. Forget that notion: give them what they want. Worst case scenario, if a document really doesn’t apply, then insert a page or letter explaining why. It’s bad enough having to rely on antiquated tech from the 70′s to handle one of your most important transactions (fax), so do your best to submit a COMPLETE package. Can’t stress this one enough.
4. Communication. Another big frustration of homeowners, is the lack of knowing what’s going on with their application. It’s important  to contact someone in the ‘loss mitigation’ department. Talking to someone in ‘collections’ may not get you where you want. Keep a log of all your communications. Write down time, date, who you spoke with, nature of conversation. This process is great for anal-retentive people. Don’t worry about being a pest in following-up with your lender weekly; after all, it’s your butt in a sling if the modification doesn’t get approved. Or if it actually does get approved, but during the tenancy of our nation’s 49th president.