Are we going to get help from the lender?

Help From the Lenders

With a cost of more than $60,000 to foreclose on a house, and hundreds of thousands of filings every month, the mortgage industry is more apt than ever before to work with delinquent homeowners to find a mortgage modification option that fits their budget. Why? It’s all in the bottom line. The more mortgages they can salvage, the better bottom line they can report to their investors. After all, we’ve seen in recent months what happens when lending institutions foreclose on too many of their loans – they go bankrupt. With the demise of several of the nation’s biggest mortgage lenders in recent months, the industry has learned that the time to work with borrowers is now – if they want to save their bank – and their own jobs.

With hundreds of mortgage lenders holding billions of dollars worth of America’s mortgages, it would be impossible for us to highlight each lender (and their loan modification options) independently. So, we’ve chosen some of the nation’s largest lenders since they will likely offer the biggest variety of options to give you a better idea of the help available these days:

Countrywide FSB

Although company president David Sambol called for "unprecedented remedies,” to the nation’s mortgage crisis just last year, claiming that the mortgage holder was “determined to assist borrowers who have the willingness and wherewithal to remain in their homes, but need a little help to do it,” he couldn’t keep Bank of America from gobbling up the struggling mortgage lender in an attempt to hold off further economic distress due to the current crisis. Although Countrywide promised widespread relief for totaling more than $16 billion dollars in October 2007 ($4 billion of that in standard loan modifications), most Countrywide customers have reported little (if any) real help since the announcement.

However since the 2008 merger with Bank of America, some struggling homeowners have found help from the new ownership in many ways. See details below.

Bank of America

Since buying out the defunct Countrywide Mortgage lender, Bank of America has been inundated with requests from struggling homeowners seeking help. Some of the options offered on their website include:

· 12-month pre-payment plans for those who have fallen behind in their payments

· 1-3 month loan extensions

· Loan modifications for rate, loan terms and monthly payments

· Debt management services to help those struggling to make their monthly payments get back on the financial fast track

Wells Fargo

According to the Wells Fargo website, the bank has taken the lead in working with customers to help alleviate the financial strain they may be experiencing due to an unrealistic mortgage and/or adjustable rate loan. Eager to help struggling homeowners work out a plan to lower their payments and pay back any unmet payment obligations, Wells Fargo is now helping borrowers establish a family budget; reorganize their expenses; revaluate their mortgage needs and restructure their loans to better meet their needs. This includes repayment plans; loan modification; partial claims, short sales and deed in lieu of foreclosures.

In addition to offering these and other standardized loan modifications to original borrowers, they have instituted two unique programs (Project Lifeline and Fast-Track ARM Solution), geared toward finding solutions that work for individual clients.

First proposed by President Bush, the Department of Treasury and select industry leaders earlier this year, the Fast-Track ARM solution is a voluntary program that lenders can use to freeze current interest rate on sub-prime mortgages for the next five years. The goal is to enable burdened homeowners an opportunity to refinance, sell, or find a better paying job.

Project Lifeline is the company’s good faith effort to pause the foreclosure proceedings on qualifying borrowers for 30 days in order to give them time to find an equitable solution.

Wachovia

In a press release issued on June 30, 2008, Wachovia Bank announced that it would be taking a number of actions to help its mortgage customers deal with a challenging economy and declining home values including offering more loan modifications, repayment and refinancing options. However, the mortgage lender is discontinuing offering products that include payment options resulting in negative amortization including their popular Pick-A-Payment Plan in an attempt to help struggling homeowners find permanent solutions to their mortgage woes.

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