Comments on: Loan Modifications: A Near Impossibility For Most

By: Dominique

Dominique — Tue, 02 Mar 2010 03:12:46 +0000

Your readers should probably also understand that California foreclosure law protections do not extend to short sales, but it is however the threat of foreclosure that is used on the banks to get deficiencies waived in a similar fashion as foreclosure would grant.

With respect to short sales reported on credit, I don’t take anything for granted – even verbiage on short sale approval letters – and any sort of inaccurate or erroneous reporting I use to help my clients remove it from their credit permanently.

By: Bob Bredel

Bob Bredel — Mon, 01 Mar 2010 20:48:20 +0000

Hi Dominique,

You are correct in that short sales do affect your credit as well. But I do want to make clear to the readers that a foreclosure on your credit report is far more damaging. A short sale does not show as such on a credit report. Most banks will report it as a settlement for less than amount stated by the creditor.

Thanks for the post.

Bob

By: Dominique

Dominique — Mon, 01 Mar 2010 20:43:53 +0000

Hi Bob,

You write:
“The truth is that foreclosure will devastate your credit for the next 7 to 10 years.”

Foreclosures and short sales remain on the credit reports *up to* 7 years. Bankruptcy is a 10 year reporting item.

By the way, short sales can devastate credit as well with delinquencies piling up and erroneous reporting after short sale.

Loan modifications are going away, but some are possible. It is important to know the numbers that the bank is looking at.
People have many misconceptions about loan mods and short sales, but at the end of the day is a math problem.

Dominique

By: Bob Bredel

Bob Bredel — Fri, 26 Feb 2010 14:40:29 +0000

Hi ACintheSC,

Thanks for your post. Unfortunately, we are still working on that one particular deal you mentioned with B of A. I wish that I could tell you that we were closer to making progress on it, but the truth is that I am not sure we are much further along than when we started. We are now at the six month mark. Also, I don’t mean to single out B of A. For the most part, other banks are equally as slow.

My guess is that Congress already knows the programs are a mess. Initially, I think a lot of us were hoping that the delays were simply due to the banks trying to get their acts together and get the programs set up correctly. However, now it is quite evident that the delays and red tape are due to something else entirely.

Thanks,
Bob

By: ACintheSC

ACintheSC — Fri, 26 Feb 2010 06:31:04 +0000

Informative article, Bob. Thanks for the information. The company I work for used to be affiliated with one of the large banks and we often received emails about the number of loans they were modifying along with how many loans that other large banks were modifying. I seem to remember that Bank of America had the lowest numbers. Hearing the process that one has to entail to attempt the modification or short sale process is disturbing and discouraging. I’m curious did your client ever get to do the short sale or were they forced into foreclosure because of BofA’s red tape? Am I naive to think that our congressmen would care to hear about the program set-up to fail? They seem to be bringing in the big banks a lot to press them about bonuses… why not hammer them on something that helps the American people keep their homes?

By: Bob Bredel

Bob Bredel — Fri, 26 Feb 2010 05:05:26 +0000

Hi Ken,

Yes, I think that is a fair point. These issues are not necessarily confined to San Carlos. I changed the title of the article.

Thanks,
Bob

By: Ken

Ken — Fri, 26 Feb 2010 04:56:51 +0000

Hi Bob, good article although I think your title is misleading. I was expecting the article to discuss why San Carlos homeowners would have more trouble getting modifications than folks living in other cities. The issues you raise while accurate aren’t confined to San Carlos.