Chermack Law

Tag Archives: HAMP

More than 500,000 HAMP modifications have been made permanent

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As of February 1, 2011, more than half a million HAMP modifications have been made permanent. Read more about it here. What do people do when they don’t receive a permanent HAMP modification? Some people, who may not qualify for a modification under the HAMP program have been able to obtain an in-house modification through their bank. Generally, the application process for an in-house modification is the same as the application process for the HAMP program, but the banks have more leeway in deciding whether to grant an in-house modification. The process for obtaining an in-house modification is not really any less frustrating or time-consuming than obtaining a HAMP modification. It is, however, another option for a struggling homeowner who would like to save his or her home.

Homeowners who are not able to save their homes sometimes participate in the Home Affordable Foreclosure Alternatives (HAFA) Program – by doing a short sale or a deed in lieu of foreclosure.

Sometimes, a homeowner who is unable to obtain a modification chooses to let their house go into foreclosure. A homeowner who chooses this option should be sure that they understand their state’s laws regarding deficiency judgments and foreclosure. Here is a link to my blog post about Minnesota’s laws regarding deficiency judgments.


Review of the Help for Homeowners Community Event

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This past Saturday, my husband and I attended the Help for Homeowners Community Event that I referred to in this post. The event took place at the Minneapolis Hilton. We got there at around 10 a.m., and a lot of people were there already. When I saw how many people were there, I couldn’t help but feel sad. I even felt myself choke up, because I was thinking about the emotions that everyone must be going through as they worried about losing their homes.

As we entered the event, volunteers wearing blue shirts guided people along. Mortgage lenders had individual tables set up. Fannie Mae and Freddie Mac also had tables. Participants went to their mortgage lender’s table and got a ticket. Their tickets had the mortgage lender’s name and a number on them. From there, the participants were led into another room, where they sat and listened to different speakers talking about loan modifications and FHA loans. Volunteers would come into the room and call out the names of mortgage lenders and a number, and then the homeowners with the corresponding tickets were brought into another room; a room full of tables. In that room, homeowners sat at a table, face-to-face, with someone from their mortgage bank.

Many homeowners who have been trying to obtain assistance under the Making Home Affordable plan have had difficulty reaching people at their banks over the phone. This event gave homeowners an opportunity to talk face-to-face with a real person from their bank. This was a great opportunity for many people. I hope that, after this event, the mortgage banks are able to help the people they met with so that their homes can be saved.

Fannie Mae threatens “strategic defaulters”

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Fannie Mae recently announced that it plans to punish people who strategically default on their mortgages.  This announcement was met with skepticism by some housing and lending experts.

It’s difficult to blame Fannie Mae for being nervous about people walking away from their mortgages when strategic default is being regularly reported on in the news:

Owners Stop Paying Mortgages, And Stop Fretting.

American Dream 2: Default, Then Rent

I think that it will be difficult for Fannie Mae to decide whether someone strategically defaulted. Many people have applied for the HAMP program, only to end up in foreclosure. Foreclosures are, unfortunately, rising. See More rural, suburban Minnesotans threatened with foreclosure. See also Foreclosures Are Rising.

Fannie Mae’s threats might scare a few people from walking away from their underwater mortgages, but its threats alone will not be enough to fix our nation’s housing mess. Fannie Mae’s energy could be better spent on making sure servicers are following the Making Home Affordable program guidelines in a timely manner.