Loan Mod Conspiracy

I was approved for a loan mod in march.  I was current when I was approved. the bank suspended my payments for three months because they were going to use the principle balance due that day plus the interest that continued to accrue during these three months in the paperwork they needed to submit to the lender.  Makes sense! 

My first new payment was due on June 1st which I paid, although I had not yet recieved the official loan documents.  I finally got the documents, signed, notarized, and returned and verified that they had received them.  I also paid July 1st payment.

Mid july I contacted the bank and they verified that the modification was complete however the two payments were not posted correctly but they assured me that it would be corrected. I then filed for bankrupcy protection. 

I called to find out where my August payment should be sent and I was informed that the mod was not complete before I filed and they were not going to honor it. I was transfered to loss mitigation who again verified that the mod was complete prior to filing.  I again called bk dept and was told the same thing, not complete and again transferred to loss mit who again said it was complete but that my payments had not been applied correctly. 

It has been almost two weeks and the payments have not yet been applied although they have cashed my Aug payment.  I called the bank today to request copies of the loan modification agreement, specifically the page that they signed.  I was transferred to five different people who could not do it but could connect me with somebody who could.  After 55 minutes of this game they finally tried to transfer me to the bk dept but the call was disconnected. 

I’m not into conspiracy theories but something stinks here!  I didn’t think of it at the time but today I noticed that the lender’s signature and my signature are on different pages, so even if they did physically sign these documents it could be conveniently replaced with an unsigned document.  Am I paranoid? 

Do I have any legal recourse if this were to go to court since they accepted three payments even though they did not apply them yet?  They didn’t reduce my interest or principle they just extended the loan back out to 30 years and it is a freddiemac loan.

Sobroke

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Hello Sobroke,

Read: Are Loan Modification and Forbearance Agreements Binding? & Revoked Loan Modification

In my opinion there’s not much that can be done to legally compel the lender; the lender is not obligated to offer a loan mod.  The fact that lenders generally get paid back all of their money in a bankruptcy where the property is retained doesn’t bode well for the prospects of a loan mod after bankruptcy. 

You can send a qualified written request to demand an accounting of the payments.  But overall, the best bet is to be persistent and continue to plead your case.  The squeaky wheel gets the oil.

Thanks for the questions and hope this helps.

Paul

This author is not an attorney and this information should not be considered legal advice.  Please consult an attorney for legal advice.