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Dealing with Making Home Affordable…

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I am throwing the white flag…

and applying for the Making Home Affordable program.

Yesterday, I left work early and made THE call. My call started at 5:07 p.m. and ended at 5:57 p.m.

I called the Making Home Affordable number on my Bank of America mortgage website and waited 17 minutes on hold. Someone answered and transferred my call since my mortgage used to be a Countrywide mortgage and they had a separate division.

I’m fairly certain they routed my call around the world because really, what else can explain the 24 minute hold time and the gentleman who sounded like had lunch in Bangladesh. He asked for my name, account number, checked my account, thanked me for paying on time, and told me I would be transferred yet again to a representative. 9 minutes later, a message said, ‘Our office is now closed. Please call back another time.’

I would give you advice on dealing with the Making Home Affordable program but since I didn’t talk to anyone, I will tell you this… you need more than an hour.

Dear Bank of America… I had far better things to do than spend 50 minutes of my life listening to Kenny G. and the recorded reminder that someone will be with me shortly. Obviously you and I have VERY different definitions of ‘shortly’ AND, I had to drink three glasses of Chianti just to keep my ears from bleeding.
Ugh. Kenny G.

I’ll let you know how it goes… if I ever get through.


25 Comments

  • Reply Mysti |

    Keep trying. I am sure it will be worth it.

    I tried, and found out our house didn’t qualify (not owned by Freddie or Fannie, or Sally, Or John, or whoever!).

  • Reply KB |

    I’ve heard that tweeting about consumer problems can get companies to react – so I tweeted your post. Fingers crossed!

  • Reply Another Reader |

    Making Home Affordable is designed to help people with stable income that got themselves into bad loans, not people with job losses. To qualify, your loan must be owned by Freddie or Fannie. You can get a modification of the existing loan or you can refinance into a better loan if you and the property meet certain criteria.

    You probably do not qualify for a loan modification because you have insufficient income to pay even a modified loan payment. You certainly do not qualify for a refinance under this program unless you could qualify for the loan on your income alone.

    I don’t know the details of your loan or your income, but it sounds like you should be preparing for a short sale. With only 8 weeks of expenses in the bank, I would get that property in tip top shape and list it immediately.

  • Reply Jen |

    Ugh – what a pain! I’ve read news stories that people trying to get information on this program have a hard time – they constantly get shuffled from one department to another.

    You might want to check out the archives at the Mortgage Matters blog:
    http://www.bankrate.com/blogs/mortgages/mortgage-blog.aspx
    He had a few posts on the different loan programs, as well as information to figure out if your mortgage is a Freddie or a Fannie.

    Good luck!!

  • Reply Caitlin |

    Is your phone wireless? If it is, just set it to speakerphone and clip it to your belt (or put it in your pocket or whatever) and do some chores while you wait. Not vacuuming, because it’s too loud, but other misc chores that need to be done. You’ll be off hold before you know it, and you’ll be productive to boot! 😀

  • Reply Another Reader |

    Here’s a typical example.

    A couple buys a townhome in the San Diego area for $400,000 at the peak of the market. Today it’s worth say $270,000. If they put 10 percent down (most folks put less down), the principal was $360,000. The PITI is a little less than $2,500 at 5.5 percent. Add in the mortgage insurance and HOA, and you are nearing $2,800 a month.

    Two middle of the road salaries of $4,500 per month put this payment in the affordable range – a little over 31 percent of gross monthly income. Now one of those salaries disappears and the couple can in no way afford the payment.

    Neither the property nor the homeowners qualify under MHA for a refinance. The only option under MHA is a loan modification. But wait, 31 percent of the reduced income (the allowable percentage under MHA guidelines) is around $1,400 PITI. If the lender were to reduce the loan amount to the current value of $270,000, which they are generally NOT doing, the P&I alone at 5 percent would be $1,450. Add back in taxes, insurance, and HOA, and the couple are not going to be able to afford the payment.

    Remember, loan modification is voluntary and entirely up to the lender/servicer. What the lenders have been doing is adding on missed payments to the principal and extending the repayment period. They are not generally reducing the principal and they are only sometimes reducing the interest rate. Things are supposedly improving, and I know a couple of people that have recently received better modification packages from Countrywide.

    If you own a nice townhouse in San Diego and your lender is the Countrywide division of B of A, get ready for a long, drawn out process. If you have a first and a second, your road is longer and the climb steeper. You may find yourself in foreclosure after months of negotiation and missed payments with little time to effect a short sale.

    Anyone in this situation should at least consider a short sale as one alternative. A short sale means fewer missed payments and less of a hit to your credit than a foreclosure.

    Finally, if the income loss is likely to be short term, some lender/servicers will grant forbearance. That’s a short term suspension of payments. If the second income earner has the prospect of being back to work in a few months, the bank may work with you on this.

    To get anything accomplished, be prepared for hours of waiting on the phone, lost documents, and different answers from everyone you talk to. Countrywide is by far the worst servicer to deal with. Good luck with the process.

  • Reply Jen |

    From what I understand, few people get this and you have to stop paying your mortgage to qualify. If you are still paying, then they are getting money from you, so why would they change anything?

    I’ve also heard that B of A is the worst with this …

  • Reply Nicole |

    Hey, I heard if you don’t push any buttons you get through faster. Try it. Maybe the person who answers the first time can get you to the right person the first time : )

  • Reply emmi |

    Another Reader, I don’t know about where you live, but where I live, rent is MORE than a mortgage payment. Whether they should try to bridge loan from friends and relatives until things stabilize depends on how much rent is relative to their current mortgage. You still have to live somewhere, and at least banks are slower at kicking you out than an apartment landlord would be.

  • Reply Another Reader |

    Emmi:

    I would like to know where you live so I can pick up some rental properties there!

    Rent for something similar to the townhouse in the example in San Diego should be significantly less than $2,800 a month. In the better urban areas of coastal California you can’t do much better than 0.3 to 0.5 percent of current value in rent and rents have been dropping recently because of the economy.

  • Reply emmi |

    Another Reader, I live in Central New York. One of those places with extra everything (water, power . . . houses, due to long term population decline)

    Grad students buy houses near the university here because it’s cheaper than renting.

    There is a two family house I just saw on zillow in not a bad neighborhood for sale: $54k. Tho, we have too many absentee landlords already. It’s a real problem.

  • Reply jaye |

    I know this is a really nutty idea, but… could you go to a BofA Branch and speak to someone there? Maybe a real person could help!

  • Reply mem |

    I don’t know your exact financial situation, but generally speaking I think that people who try for the MHA program are in a sort of denial and what would really be best for them is a total overhaul/sale of all of their assets and a downshift in lifestyle to a level that is very comfortable and safe at your current level of income. Don’t set yourself up for a decade of financial struggle hanging onto houses, cars and other assets that don’t truly fit within your financial reality. Sell, sell, sell and live an easily sustained lifestyle.

    I hope there is some good that comes out of this experience, such as the lesson that one should not spend on cruises, wedding events, parties, dinners, etc when finances are tight or when one is in debt.

  • Reply jaye |

    I’m curious to know how many of the people who have recommended fixing up your house and selling it have done that recently? My husband and I tried to do that–we were even willing to lose some money–but were unable to sell. So, we painted, fixed up, cleaned cleaned cleaned and, lets face it, spent money for nothing. If we had been willing to lose 50k+, I suppose things might have been different.

    Might I suggest that none of us knows the situation well enough to be so smugly condescending, especially within days of her husband losing his job?

  • Reply John |

    I wish you a lot of luck with this. Those darn transferred calls to India can drive you crazy. I know a lot of Bank of America employees who say, “I guess I need to call India”, when they need help with something. I have recommended many people in need of help call their banks, not only about their mortgages, but their credit cards too. Most of them knew they were going to start falling behind and wanted to be proactive and upfront with their lender, but they always would get turned down, from Bank of America especially. Unless you are late on your payments they won’t help you. Which sucks because you basically have to start letting your credit go to get help. All I can say is keep trying until you get somewhere. Hope your husband is able to find work soon.

  • Reply Lizzie |

    Before the “crash” we tried to sell our home for over two years to no avail (this was an almost brand new home that we were asking less than appraised value for-and less than what we owed on it). I have no idea to this day why the home did not sell. So for those offering that advice, I agree with Jaye, have you tried it in the last couple of years?
    Hopefully he will get another job asap and you won’t even have to mess with that decision!

  • Reply Beks |

    Another Reader – Actually, you are incorrect. The first thing my bank asked was if job loss was the reason – but on top of it, my husband and I have a Countrywide loan that is bad all on it’s own, even without the job loss. And, we did qualify for the program with the job loss included.

    Jen – That’s what my parent’s lender told them too. I guess it depends on your lender.

    Mem – We can survive 6 months to a year on my salary, unemployment checks, and odd jobs (we were surprised we could do it!). We have the time to wait – but we’re hoping he gets a job LONG before a year from now. For the most part, I agree about most of the people who apply for the program being in denial about what they can afford in a lifestyle.

    Jaye – I agree! We’re 135K upsidedown on our home. Even a new pool and kitchen couldn’t put us right side up again. And thanks for standing up for us!

    Lizzie – Oh so right!

  • Reply Thuy Tran |

    I heard Bank of America is one of the worst banks to deal with when you are trying to do a loan modification. I am in the same boat. I tried and tried again to put in a request for a loan modification, but every single time I call them back for a status update, they have no recollection or notes of my request so I start over again. This has happened to me about 6 times, at least! I figured it was because I kept making my payments. Of course, I’m not able to make my payments but I got family to help me. I think because my mortage is current, they didn’t see a reason to help me. Afterall, they are still getting their money. So I have stopped making my payments for two months and I hope my defaults will get their attention. We are crossing our fingers! Good luck to you too!

  • Reply Mary |

    I have been trying to work something out with BOA for almost a year. I don’t think anyone in various departments have a clue as to what the other departments do. I have been transferred as many as 5 times. And your right, plan on at least an hour. I was assigned a negotiator 3 weeks ago who would be in touch with me within 5 business days. That was 3 weeks ago. The number left for me to contact that person never rings to her actual extention. She is never available, and I am then transferred to someone who wants to know if I am calling to make a payment…. I have heard of a few success stories from Wells Fargo. Nothing good from Bank of America.

  • Reply JANICE |

    Wow, just reading what everyone has said here I guess I should not be hopeful about a modification with Bank of America. I know how everyone feels with the calls being transfered all over the dang world. I recently lost my job due to a company closure. My income was reduced $1083.00 per week when I went on unemployment. I am thankful that I was able to see the big picture prior to my job loss and got alot of my bills paid down. But, my income loss still makes me over 40 percent of my unemployment income for house payment, taxes and insurance. BOA said that I qualified to apply for this modification. I was told that I would have to wait for 45 days for a decission. It has been 30 days now. I am still making my payments on my loan. I have quite a bit of equity in my home. So, reading the post here is confusing me. Just because BOA told me that I qualified due to sugnificant loss of income. Guess I will just have to wait and see. I will not loose my home either way. Hopefully I will find a good job soon. I would hate to have to start at the bottom again. But, if that is what I have to do then so be it. I also remember reading where rent is higher then a house payment. I am in Texas and in my case yes rent is higher then my house payment. I could not get a 1 bedroom apartment for what I pay for my house payment, taxes and insurance. Good Luck to everyone.

  • Reply Linda Martin |

    I also have waited over a year and they lost my paperwork several times. (mailed it, faxed it, overnighted it all) If you are self employed like me, FORGET IT. They don’t understand our taxes or income. We have been turned down after mailing coutless documents and making nuberous calls every month. What a waste!

So, what do you think ?