Dubiln Packard

Todd Murphy

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Do I qualify for a home loan modification?

do i qualify for a home loan modificationWhen trying to obtain a home loan modification, one thing most people want to know up-front is, “Do I qualify for a home loan modification?”

Underwriters evaluate the ratio between your income and your mortgage payments first.

Next, the underwriters look at your monthly expenses and compare these next to your mortgage payments. They subtract your mortgage payments and expenses from your income; this value cannot be in the negative in order for you to qualify.

If your debt to income ratio is OK and your expenses are not too high, you should qualify for a home loan modification which will save your home from foreclosure.

Will I Qualify For A Loan Modification If I’m Self-Employed?

If you’re self-employed, there are certain considerations that the bank makes in evaluating your loan modification application. You must organize your finances in such a way that the bank approves of. If you are self employed and trying to get a loan modification to save your home, read our post: Will I Qualify For A Modification If I am Self-Employed?

 

How Do I Get A Home Loan Modification?

To get a loan modification you must find out what forms your bank requires and send them in exactly the way that they specify. If you want to find out how to get a loan modification, read our post: How To Get A Loan Modification. 

 

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What is MERS?

MERSAlthough it has become less of an issue, What is MERS? is a question I get from time to time from clients as they try to understand just who it is they are dealing with at their home loan lender.

MERS is a warehouse and database for mortgage documents designed to simplify the recording of mortgage documents and the process of trading loans form one investor to another to save the big banks money.

MERS stands for Mortgage Electronic Recording Service.  When you first closed on your home loan, you signed two documents: a Note and a Mortgage. The Mortgage was then recorded in the County Clerk’s Office in your County to let the world know there is a loan on the propriety which is secured by the property. The name on your mortgage document was the home lender you first dealt with and MERS.  MERS kept a copy of your mortgage document in their warehouse and database as a convenience to your lender.  The very next day, your home loan lender transferred your loan to an investor.  In fact, your home loan may have been transferred several times between investors since you first closed on your home loan.  Each and every time there is a transfer of the loan from one lender or investor to another, an assignment of mortgage would have to filed in the County Clerk’s Office in your County and a filing fee would have to paid to the County Clerk.  However, because MERS is warehousing the mortgage document for the lenders and investors and continues to do so even after each and every transfer, there is no need for an assignment or the recording fee.  Brilliant! Right?

Definitions:

The Note is a contract between you and your lender where the lender agreed to provide funds to purchase your home and you agreed to pay the bank back over time with interest.

The Mortgage is a document which is recorded in the County Clerk’s office in the County where your house is located and let’s the world know that your home lender has a priority lien on the property and if you default on paying on the Note, the lender has the right to foreclose on the property in order to pay themselves.

While there was  lot of discussion about whether or not MERS was legal in the early days of the foreclosure crisis, the issue has pretty much been resolved and is no longer a grounds for a defense in a foreclosure action.

Resources:

MERS can help you if you don’t know who your mortgage servicer is. You can use the MERS database to find out who your loan servicer is if you don’t know.  Go the MERS website and enter the Mortgage Identifier Number to find out.

If you need help with a foreclosure action or getting a loan modification, submit your information through our Free Evaluation feature her on our website.

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New Jersey Foreclosure Activity Still High in 2014

foreclosure homeNew Jersey foreclosure activity still high in 2014 according to the latest information from RealtyTrak which tracks the foreclosure market nationwide.  In New Jersey foreclosure filings have picked-up compared with a year ago, but, it still takes more than 2 1/2 years for lenders to evict New Jersey homeowners who can’t pay their mortgages.

According to RealtyTrak, the number of homes in or at risk of foreclosure  in New Jersey rose 55 percent from September of a year ago to September 2013. Foreclosures were all but frozen for more than a year after questions arose about “robo-signing” – in which mortgage industry representatives signed legal documents without checking them. It has resumed in the wake of several legal settlements and court rulings.

Lawyers from New Jersey’s largest foreclosure law firms such as Fein Such and Zucker Goldberg, tell me they filed a very large number of foreclosure cases in September and October in efforts to get many cases that were stalled for months back on track for a Sheriff’s sale.

New Jersey’s foreclosure process is still the second-slowest in the nation, after New York. Other states have already gotten past the worst of the foreclosure crisis, and foreclosure filings dropped nationwide about 27 percent in September compared with a year earlier.

In the third quarter, Florida and Nevada continued to have the highest foreclosure rates.

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Capitol One: Not In My Wallet

credit card fraud risk high in new jerseyA report published by NJPIRG says Capitol One is one of the worst credit cards for New Jersey according to consumer complaints.

The report from NJPIRG stated Consumers were most likely to complain about billing disputes (16 percent of complaints), followed by difficulties with APR or interest rates (10 percent) and trouble with identity theft, fraud, and embezzlement (7 percent).

Spokesman Peter Skopec says the report analyzed data from the Consumer Financial Protection Bureau, a federal agency that monitors complaints to ensure banks are not ripping off consumers.

“Something that’s really key is the CFPB should make sure to really aggressively publicize the database and also the resources that it has for consumers cause really the more people take advantage of those resources the more effective the CFPB is going to be and the more likely the banks are going to be to actually improve their practices and be more consumer friendly.”

Skopec says there is some good news, nearly 40 percent of complaints result in some tangible or monetary relief, nearly $800 million nationwide. According to the report Capital One got the most complaints of any bank statewide.

Samuel L. Jackson appears in the latest Capitol One credit card commercial.  Perhaps we should let him know that he should choose who he works for a little more carefully.  Get in touch with SLJ here:

Samuel L. Jackson @SamuelLJackson

http://samuelljackson.com

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Good News: Mel Watt Confirmed as Fannie and Freddie head

FHFA Director Mel Watt Swearing In
Mel Watt

The Senate voted 57-41 on Dec. 10, to confirm Rep. Mel Watt, D-N.C., to head the federal agency overseeing Fannie Mae and Freddie Mac, ending a year-long battle by the White House to install a regulator

Mel Watt, a liberal Democratic congressman from North Carolina, favors  mortgage write downs. Watt will replace Edward J. DeMarco as director of the Federal Housing Finance Agency who has opposed allowing Fannie and Freddie to reduce the principal on mortgages they own or guarantee and has thereby made it tougher for you to get a principal reduction while modifying your mortgage.

This is good news but I’m not sure how long it will take Mel Watt to have his views make any effect on the current situation of mortgage lenders reluctance to reduce principal in home loan modifications.  Only time will tell.