In April, a Congressional Oversight Panel revealed that just 168,708 homeowners had been able to permanently modify their loans through last February. That’s a tiny portion of the estimated six million homes still in trouble.Falcon resident Bob Smith is among the tiny portion. He has saved his house by renegotiating his first mortgage under the Home Affordability Mortgage Program.Smith obtained two loans – a first and a second – from Aurora Loan Services to buy the house in Falcon that’s home to him, his wife, children and father.As the economy entered the recession, Smith’s business – recruiting personnel for high-rise commercial construction in Las Vegas and southern California – dried up. To save his house, Smith had to reduce his monthly mortgage payment. He went to HAMP (the Home Affordability Mortgage Program).By that time, Lehman Brothers, which owned Aurora, had entered bankruptcy and his two loans ended up with Fannie Mae.”They [Fannie Mae] kept saying I wasn’t eligible for HAMP, when I was, so I kept going back and making my case,” Smith said.He said he spent about two months working full time to get his first mortgage through HAMP, but it was well worth it because now his mortgage is less than the cost of renting a house.Smith’s business is making money again now that he’s recruiting for a different industry – supply-chain logistics, where domestic and international companies are hiring.Although he’s doing OK, Smith said he worries about his neighbors and church friends who are in financial trouble but too shy or embarrassed to take action.”We’ve tried to help by giving them all the information. We know it’s hard to do,” he said. “My own brother is having a hard time and would qualify for HAMP. Sometimes, people just won’t do what they know they should do.”According to the Making Home Affordable Web site, to qualify, the loan must be a first mortgage originated on or before Jan. 1, 2009, have an unpaid balance of less than $729,750, must be the homeowner’s principal residence and must not have been previously modified. Visit www.makinghomeaffordable.com for additional criteria.Aaron Brewster, president of Pikes Peak Foreclosure Prevention Partnership Inc., said the Making Home Affordable program is not helping enough people.”If it was helping, we’d see more and more people able to get through to work with a caring, concerned representative that wants to get this done,” Brewster said.PPFPP is a nonprofit organization staffed by 20 to 30 trained volunteers who, at no charge, help homeowners work out loan modifications with their lenders. Most of their calls come from people who’ve delayed seeking help until a notice of auction has been posted on their front door, he said.Homeowners who’ve just been notified have a short period of time to call PPFPP to see if they qualify for assistance, but many don’t qualify, Brewster said.PPFPP’s volunteers are trained to know the types of borrowers that lenders are willing to work with. A lender is more likely to agree to a modification if the homeowner is employed, can show positive cash flow and has a good debt-to-income ratio, he said.Brewster had some advice for people trying to negotiate a modification through PPFPP or on their own:
- Don’t listen if someone tells you to call back in two to three weeks; call back every other day (and that includes PPFPP). Every customer service representative has too many cases to handle. You have to keep your case at the top of the pile.
- Don’t lie about your circumstances. The lender has already made a calculation about your situation.
- Provide all requested paperwork – an income tax return, a pay stub, a letter of hardship or a bank statement – promptly.
