I am working on a foreclosure mediation in which the bank offered the borrower a permanent HAMP loan modification for a Freddie Mac loan.  The borrower neither explicitly accepted nor declined it, but told the bank that several of its inputs (income, home value, etc.) were erroneous and supplied supporting information.  After requiring the borrow to resubmit everything and scheduling a second mediation session, the bank now says the borrower declined the modification and the bank is not requried to consider another second modification.  I spent a few hours reviewing the HAMP Handbook and the Freddie Mac Guide and find guidnace for the borrower disputing inputs when a mod is turned down, but nothing when it is approved with erroneous inputs which make the loan modification little better than the original loan.  Any words of wisdom for me?  Alison

Views: 153

Replies to This Discussion

It would seem to me that not correcting the erroneous information of at least verifying working  to verify it, would be a lack of good faith.

I'd have them run the NPV with the corrections and see if it pencils out with the 31%

If with the corrections the mod at 31%  of income still benefits the investor or beneficiary, I'd question good faith if they won't work on the corrections.

The lender is required to provide the borrower in writing the inputs used for the HAMP loan modification. They have up to 30 days to dispute any inputs that they feel were not accurate, but mostly this is done when the loan as failed the NPV calculation. 

You may want to refer to the bulletins beyond the actual HAMP underwriting guidelines. They are frequently released and offer coding and new underwriting amendments that could be helpful to know. 

Was the modification the lender offered close to the target reduction for HAMP?

RSS

Welcome

Welcome to our community of ADR professionals: mediators, arbitrators, and lawyers representing and advising clients.  We are active in the growth and development of ADR in Washington as well as the education of members of the bar and the public.

Latest Activity

An event by WSBA ADR was featured

Basic Mediation Training at Seattle University School of Law

December 7, 2019 from 8:30am to 5:30pm
Nov 18
WSBA ADR posted an event

Basic Mediation Training at Seattle University School of Law

December 7, 2019 from 8:30am to 5:30pm
Nov 18
Dee Knapp posted a status
"Participating in a dynamic retreat and discussion with my fellow members of the WSBA ADR Executive Committee this weekend!"
Nov 16
Adrienne Keith Wills updated their profile
Nov 1

© 2019   Created by WSBA ADR.   Powered by

Badges  |  Report an Issue  |  Terms of Service