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Does this sound right? - Loan Modification

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What is the name of your state? Indiana

My mortgage is with Chase Manhattan. I got behind in payments, and I called the Homeowner Assistance Department. I sent in my information, and I got a call from a rep, stating that I didn't qualify for a repayment plan, but that I qualified for a loan modification. After ordering the title, she called me back about 5 days later, and stated that they would send me the paperwork to be signed and notarized, and told me what the amount I would need to pay up front for attorney fees and such would be. She told me that they were behind in getting this paperwork done because they had so many that they had to do this month, and that if I faxed her a copy of the cashier's check when I got it, she would stop the sale. I did that yesterday.

She called me to tell me that she received the fax, and that the sheriff sale, which is scheduled for 3/15/06 was put on hold for 30 days. In that time, I should receive my paperwork to sign. She said that when they have the paperwork back, along with the cashier's check, that everything would be stopped permanently, and that I would be "starting over". My monthly payments will be higher, but since my income is higher, it's no big deal.

Is it normal to have to wait 15-20 working days for loan modification paperwork? I know that it takes them a while (I submitted my income and expense information to them at the end of December). But with the sale date so close, and the Sheriff's office telling me that it hasn't been removed yet, I'm beginning to freak out.
 


pty

Member
15-20 day is not an excessive amount of time. If you're worried, ask the rep for something in writing stating the arrangement.

But, I'm wondering why your payment is going up. Most hardship loan modifications either tack the delinquent payments onto the end of the loan--payment amount stays the same--or reduces the interest rate (for example, the mortgagor had a permanent loss in income, can't afford the payment at 8% but could afford it at 7%) which causes the payment to go down. Did they increase your interest rate?
 
No, they didn't increase my interest rate, but they did not extend the term of the loan, either. In other words, the maturity date will remain the same.
 

pty

Member
Ahhh. So maybe they took the delinquency and spread it out over the life of the loan? In which case the payment amount shouldn't have increased much.
 

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