Many homeowners have struggled to obtain a trial modification from lenders like Bank of America as more homeowners are in need of mortgage assistance. Bank of America is one of the top financial institutions participating in the Making Home Affordable Program and has been offering various mortgage assistance options to homeowners who are in distress. However, many of these homeowners in need have been upset with the modification program and, specifically, cancellations of trial modifications by many of these top lenders.
Mortgage lenders have stated that troubles in the modification trial process have arisen due to factors like improper documentation, homeowners defaulting in the trial plan, or homeowners debt to income ratio being below 31%. These factors, among other things, are what lenders attribute to the cancellations of some trial modifications.
However, angry homeowners believe that lenders are doing as little as possible to help homeowners find the assistance they need. Accusations that lenders do not want to help homeowners avoid foreclosure have been common, but lenders obviously disagree and have stated that not only are modifications available but alternative Making Home Affordable assistance plans and in-house mortgage aid options are as well.
According to the June report from the Making Home Affordable Program, Bank of America has had a total of 100,413 trial modifications that have been canceled as of May 2010. Yet, 20,564 of these cancellations led to an alternative modification, 761 led to a payment plan outside of a traditional modification, and 3,009 homeowners were said to be current on their home loan after having their trial modification canceled.
Yet, critics of the modification program and Bank of America have said that these numbers for canceled homeowners do not reflect the wider picture of trial modification cancellations. For instance, 2,154 homeowners went into bankruptcy after having their file modification canceled, 1,248 were either in a short sale or deed in lieu of foreclosure program, and 2,440 homeowners have begun the process of foreclosure with 192 being completed, according to June’s modification report.
It’s obvious that homeowners and lenders disagree on what should be done in the trial modification program. Homeowners want more leniency in assistance when it comes to qualifying for permanent modifications or simple mortgage assistance, while homeowners continue to cite the fact that not all homeowners either qualify, can afford a trial modification, or properly adhere to the requirements in order to obtain a permanent home loan modification.
Regardless of these disagreements, homeowners are still being advised to contact their mortgage lender if they are having trouble making their home loan payments. The earlier a homeowner speaks with a lender about assistance options the better chance they may have of obtaining an affordable means of making their home loan payment more affordable.
While there are some homeowners who believe working with lenders is futile, and these homeowners choose outside sources for assistance in the modification process, homeowners are cautioned to be wary of scams from these outside sources. Again, lenders are often the best primary starting point, but there are reputable assistance sources like the Making Home Affordable website which can help homeowners who are seeking a modification.