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srsd
Reply with quote  #1 

I was reading an article on Fox news that stated that mortgage companies would rather modify loans than foreclose.  I really don`t think this is true.  When our income dropped, due to hospitalization,  I asked about a loan modification but was denied because we didn`t qualify because our income was still high enough to make payments. I guess they don`t consider that you are not able to work but then you have medical bills and medicine also. Has anyone on the board had a loan modification?

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4 justice now
Reply with quote  #2 
FYI:

I believe it has a lot to do with how much equity you currently have in your home. If you have a fair amount they would rather not modify anything and just take you home and your $$$.  Also. it depends on the servicing agreement between the investor and the servicer... some can, but I would think most won't unless they absolutely have to do so. It's a really sad commentary on the businesses of today and their total lack of compassion, or even ethics for that matter. Please let me know if you have any luck.

R,

4J
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Mike Dillon
Reply with quote  #3 
Depending on whether the loan has been securitized and how the Pooling & Servicing Agreement is written servicers would absolutely rather modify a loan - but the key word should be BEFORE they foreclose. If there are modification fees involved those fees may go directly into the servicer's pocket as "additional servicing compensation" depending on how the PSA was negotiated.

This just goes back to the standard party line of "lenders don't want to foreclose" - which may or may not be true depending on who you're talking about at the time. But servicers - I firmly believe that they, at the very least, have no thought about it either way and at the very most want to hold off foreclosing for as long as possible. But this would only be in order to bleed a home owner as much as possible before foreclosing because late fees ALSO usually go directly into a servicer's pocket as "additional servicing compensation". Keep a homeowner in default for as long as possible making as much money off of them as possible and then, once the homeowner has been financially exsanguinated, foreclose - step 1 of the property laundering process.

Once that takes place, the servicer will most often purchase the property for the amount owed on the loan regardless of fair market value. THIS is an interesting move because in purchasing the property for the loan amount due the servicer completely wipes out any equity that a homeowner may have in their property. The purchase of the property by the servicer is step 2 in the laundering process and it is a rather significant one because the purchase by the servicer not only wipes out any equity in the property but it also gets the property off of the lender's books. It also usually ensures that the servicer will see some kind of profit when the property is sold on the retail market - most likely for at least near fair market value. But because the servicer purchased the property at the foreclosure sale none of the profit realized by the servicer needs to be transferred back to the foreclosed homeowner. Step 3 is the actual sale itself which effectively launders the property off of everyone's books and puts it back into the pool for yet another round of fraudulent servicing, predatory lending, inflated appraising and anything that can be done to it.

Can ya tell that I wrote this after 2 am ?
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Dee
Reply with quote  #4 
Actually, it is quite well written, IMO.

I would also add a big danger in the loan modification process, is most
likely you will be signing away your rights to sue for their past conduct.

You might not want to do that.  They even try to get you to sign away
your future rights for any mistakes they make then.

That was common practice for Fairbanks in the past.  Don't know how that
is working for them now though.

It is good thinking on their part and helps keep you shut up in the future.
The part about the future is laughable but nonetheless they get it in there.

They can raise the interest rate is another disgusting practice. 
That's just what you need if you can't make your payments now.
Desperate to keep their houses, borrowers will go for it.

This website and RipOff Reports as well as the mortgage fraud group on yahoo have all had people post this was being done.

If this current attitude prevails in the securitization of mortgage loans
there are not going to be a lot of brokers or lenders looking to write
the poor quality loan as they will have a much harder time selling them
since the investors started losing money.

What makes me laugh about Bear Stearns is that they are blaming the borrowers.  They claim we are irresponsible, make bad decisions when we accept a toxic mortgage, and then default.

They forget to reveal that they just pulled the same scam on the investors as they do borrowers through the mortgage servicer they own, EMC.

Borrowers are in the same boat as the investors, S.O.L.

Maybe that will help get a better written loan but it is also going to knock
some people out of the market altogether.

Dee


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O -
Reply with quote  #5 

Deletion might be a good starting point, modified to ZERO!

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O -
Reply with quote  #6 

You should read every word on your mortgage contract, Make a list of things they have violated.  Non-compliance

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srsd
Reply with quote  #7 
The reason I posted the question was after I read this:
 

Lenders Seek to Modify Rather Than Foreclose Mortgages

Wednesday, April 04, 2007


NEW YORK —  As home foreclosures mount, mortgage companies are knocking on doors, sending letters and making phone calls with a simple message for struggling homeowners: They'd rather modify your loan than foreclose.

EMC Mortgage Corp., specialist with a $78 billion portfolio of subprime loans -- for homeowners with weak credit -- this week launched a 50-person team it calls "the Mod Squad." Members will spend an unlimited time on the phone with troubled borrowers, sifting through their bills to compute a workable monthly payment. In an industry that often rewards workers for getting off the phone quickly, the team is preparing to speak to just three people a day.

"You can't just run this like a call center; it needs to be run like a counseling center," said John Vella, president and CEO of EMC. Right now, $2.14 billion in mortgages, 2.74 percent of EMC's portfolio, is in default, up from 1.93 percent a year ago.

Lenders have long modified loans for homeowners facing job loss, illness, divorce or a death in the family. But with many borrowers across the country struggling to keep up with mortgage payments, mortgage companies increasingly are prodding anyone who's having trouble making payments for any reason to give them a call.

Critics say lenders made loans to borrowers who weren't creditworthy with terms that would be impossible for them to meet. Whether the current wave of workouts will merely postpone foreclosures -- and delay bad loans hitting lenders' books -- is an open question.

Regulators will be watching to see how many are successful, said Susan Wachter, a professor of real estate and finance at the University of Pennsylvania's Wharton School of Business.

The scant public information on modifications makes evaluation tricky, said Thomas Lawler. The former chief economist at Fannie Mae now runs his own consulting business, Lawler Economic & Housing Consulting, in Vienna, Va.

Loose lending standards followed by lax modifications can merely delay a problem, Lawler said. He pointed to the raft of modifications done in the manufactured housing business in the mid 1990's, when easy credit led to a wave of defaults and reposessions.

"If people had known what the servicers were doing, red flags would have been raised; but by the time people knew what was going on, it was too late," he said.

Advocates say that half the people in foreclosure never talk to their banker before losing their house, and many could rework their loans if they only got help.

"It's tragic," said Colleen Hernandez, president of the nonprofit Home Ownership Preservation Foundation. "We have the capacity to help a whole lot more people."

Calls to her group have picked up markedly. Its 24-hour hotline, (888) 995-4673, is getting 300 calls a day, from 75 daily in the first quarter of 2006.

A modification helped Ana Rodriguez, 41, keep her family's home.

Rodriguez and her husband, Ricardo, bought a house in Chicago's Jefferson Park neighborhood in 1998. Their mortgage was $1,200 a month. After he lost his job as a machinist, the couple refinanced the home in 2004 with an adjustable rate mortgage. The new payment was $1,500 a month.

He found a new job, but a year later, he was out of work again.

Rodriguez, a secretary, called Chicago's department of housing, which referred her to a nonprofit. It worked with her mortgage company, Homecomings Financial, part of GMAC Financial Services.

"I did emphasize that if there was nothing they could do before we would lose our home, we wanted to sell it before losing," she said. "They said they were going to try to work everything out."

Her husband found a job soon after and the couple made three payments that included penalties and fees for the installments they'd missed. He quickly found a better job and the couple was able to refinance with a 30-year mortgage at 6.62 percent interest last October. The monthly payments are $1,600.

"We really got ahead of this one," said James Leyba, the community relations specialist at Homecomings who worked with the Rodriguez family.

New foreclosures hit their highest ever level in the fourth quarter of 2006, according to the Mortgage Bankers Association. Home owners are the obvious losers, but all the financial services companies involved lose. The lender loses the steady stream of payments it counted on. If it sold the loan as part of a securitization, a package of mortgage-backed securities, that investor loses. Loan servicers, who are usually paid a fraction of the interest on a loan, lose too.

With home values falling in some parts of the country, none of the finance companies want to be stuck owning a house that has depreciated, or, worse, a house surrounded by other homes in foreclosure. EMC says it loses, on average, 40 percent of the value of a loan in foreclosure and also has to pay taxes and other expenses on the property.

"The larger the loss of value and the greater the likely loss will be, the more flexible we are," said Larry B. Litton, Jr., president and chief executive of Litton Loan Servicing in Houston, which services $60 billion in mortgages. "We may waive past-due amounts. In extreme situations, we may even waive principal, if need be."

Litton said his company is modifying about 1,000 loans a month; up from 300 to 400 about six months ago. Vella said he hopes the Mod Squad will be able to modify up to 2,000 loans a month; six months ago EMC only modified about 400 loans a month.

EMC has hired an increasing number of contractors over the last three months to knock on the doors of shaky borrowers and drop off fliers asking the home owners to call the company. Last month, the contractors visited 3,000 properties.

The Mod Squad is planning a six-city tour; it hopes to attract struggling homeowners to information and counseling sessions with offers of $100 gift cards to Home Depot Inc. (MD).

Companies with older programs are trying to stand out. The Hope program sponsored by GMAC ResCap and Homecomings Financial, has a team of 20 loan workout experts, 13 of whom work out of the offices of community service non-profits and housing advocacy groups.

The investor in securitized loans often dictates how much a loan can be modified, and Litton said his company has demanded more flexible terms from securitizers, which lets it modify problem loans with lower interest rates or extended terms. For instance, a home owner whose adjustable rate mortgage "resets" to a higher interest rate on May 1, 2007 might get a 24-month extension, putting the adjustment off until May 1, 2009.

"That may give the borrower breathing room," Litton said.

"It's really up to servicers in this climate, he said. "If the servicers aren't flexible, then we're going to see credit losses like we've never seen before."

I can`t understand why they print things like this. I doesn`t seem to be true in our case but it was over a year ago when I asked about the modification.

 

I noticed some peoples favorite person listed....Litton
 
 
http://www.foxnews.com/story/0,2933,263992,00.html?sPage=fnc.business/realestate



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Mike Dillon
Reply with quote  #8 

Quote:
Originally Posted by srsd
A modification helped Ana Rodriguez, 41, keep her family's home.
 
How much, if anything, did the loan modification cost her in fees? Was her loan securitized? If her loan was securitized, was the Pooling & Servicing Agreement in the prospectus for the trust that her laon was in stipulate that the SERVICER of the loan get to keep the modification fees as ADDITIONAL SERVICING COMPENSATION?
 
New foreclosures hit their highest ever level in the fourth quarter of 2006, according to the Mortgage Bankers Association. Home owners are the obvious losers, but all the financial services companies involved lose. The lender loses the steady stream of payments it counted on. If it sold the loan as part of a securitization, a package of mortgage-backed securities, that investor loses. Loan servicers, who are usually paid a fraction of the interest on a loan, lose too.
 
BS - I believe I already covered why I call BS in this thread.


Thanks for this reminder, SR. I wonder if Home Depot really wants to be associated with the likes of EMC. I wasn't able to talk to anyone at corporate back in April when this piece first ran.
 

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Moose
Reply with quote  #9 
Hint 1:  None of them will do anything that isn't in their best financial interests. You don't really know what their financial interests are. If they're one of the notoriously predatory servicers, they CANNOT BE TRUSTED unless they've signed something that can come back to haunt them in court.

Hint 2: Their BS about the cost of foreclosures is a deliberate and carefully orchestrated PR campaign which is designed to deflect regulatory and legislative attention and keeps media attention and scorn away.

Hint 3:  They don't really care about your financial interests. The person you talk to has a job to do and gets a bonus based on how well they do what they're told to do which is protect their financial interests not yours.

Hint 4:  They can't give you legal advice, but they will do everything right up to the point where you really need it and then they'll tell you you don't need it.

Does that make it clear enough? They will dodge questions, delay answers, lie, cheat, hide information and use whatever they can get from you to make their numbers. If they don't, there are lots of fired mortgage industry workers ready to take their place who are more than willing to repeat their slimey performance.

Again - STAY OFF THE DAMN PHONE with servicers.  The teams they've assembled ARE NOT there to save your home they are there to do whatever is in the best interests of the loan investors that are their customers. If you have equity or enough income they WILL TAKE IT FROM YOU AS SOON AS THEY CAN COERCE YOU INTO GIVING IT TO THEM.

You can't tame a shark by feeding it.

Moose





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josephson
Reply with quote  #10 
Hi,
i am three months behind in my mortgage, what's the best option i have now?
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~Beenawhile
Reply with quote  #11 
Hi Josephson,

There are a few things we need to know before any can make any suggestions?

1. Why are you behind in your payments? Is it from unemployment, medical problems, an ARMS loan?

2. Were you, or are you currently in a bankruptcy case?

3. Are you 3 months behnd in the payments, because the Mortgage Servicer "says so" or are you behind because you had the inability to pay?

Not much advice can be given if we don't know where to start.
Fill us in.

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Tanya
Reply with quote  #12 

I just found out my mortage will go up in Febuary, Im have a Arms loans, i called my Mortage company and they suggested a Loan modification. Should I do it?

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Ann Holden
Reply with quote  #13 
WARNING WARNING WARNING

PLEASE be CAREFUL how you respond to questions on this message board.

You NEVER KNOW who is watching.
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srsd
Reply with quote  #14 

Don`t count on the loan modification.....start getting everything you do in writing.  It is not a good thing to speak to anyone at this point if you are behind. Make sure you send correspondence certified so you will have proof that you sent something to the company and keep everything they send to you....even the envelops.

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Anr
Reply with quote  #15 
I'm sorry if I'm sending this to the incorrect persons, but I do not know where else to send this. Our home went into default in 2009 due to my husband, not being able to work, and I was pregnant and without pregnancy insurance. 

We talked with our bank at the time, I can't remember if it was with CountryWide at that time or not, but we have been dealing with Bank of America since. 

We asked what our options are, and they stated loan modification, that we needed to give them information over the phone and then we would receive a packet in the mail, this went on for years. We would not receive it for months and our home would go into foreclosure every 2-3 months and we would call back non stop till it was stopped, and we got packets maybe every 6 months and they would deny us. One time they told us we made 50 dollars to little another was we made 300.00 to much, we are self employed and informed them to save what we could we were only paying ourselves what we needed to pay bills and we would start taking in what they needed us to.

We had one woman that was nice there, and she told us what she believed we needed to be taking in, so we did. And we called and called and finally had an answer that we made the modification, and would be receiving the packet to start this, this was in 2011. Apparently it took this long because if you do not send all of your paper work, through priority and have it signed for they will always deny receiving it, and will tell you papers are missing even though someone you talked to the week before says "we have everything we need".

We would resend the exact same paperwork, to have different people tell us different things. I would like it also noted no one would tell us what we owed so we could become current because obviously through the years of watching the news about how dirty this was all going down and how familiar things were sounding, so we requested it, they said they could not provide that information over the phone, and would have to send it through mail, we kept calling to complain we didn't receive it, and different people told us that is what modification is for so you don't have to pay it all back, it gets put at the end of payment.

I would also like it noted that we were never told we were going into foreclosure except in 2009, every time we found out our home was on the list again we found out from people driving by non stop and stopping in front of our house with crap stories, trying to get a peek inside. 

So we would call Bank of America, and be informed yes it was and the date the sale was to be on, and we should of received paperwork and they would read off our P.O. box number every time, but nothing ever came. We pretty much got called liars about that. 

Well to get to what is happening now while we were picking up our Christmas lights in early January, and after hearing in November 2011 we were finally excepted for loan modification, and waiting on our packet. We noticed cars driving by and the litter in our yard (which is what always happened when it went into foreclosure I got online and could not find any info about it coming up but I figured I'd better call BOA and sure enough it was scheduled for foreclosure on the 25th of Jan., we asked why stating they said we made the modification loan, and we were told we could only speak to our loan manager that not just anyone could speak to us this time. So we called sometimes 30 times a day with no answer. The message leaves a number of our case handlers manager and their manager. We called all these also with no reply. 

Finally we spoke with (we couldn't fully understand her name) Mariam Bell I believe, and she said it was just like before, call her back 7 days before auction and she will stop it, which has become normal for us, we asked why this, when they told us we made the modification and she said she would look into it, and we will probably still receive a packet.

We informed her we don't ever get the packets except for the modification every so often. She said we should. So we try to call her back no answer.  

We are traveling (my husbands work) and finally reach her again this is like 2 days before auction now with us calling somewhere up to 30-40 times a day and her message stating she gets back to people in 24 hours. We called different numbers they said we could only speak to her, but that they could make a note and send her an email that we are trying to get ahold of her. Finally she picks up says it wont stop unless we pay.

Well this is the first we've been told this and we asked if there are any other options, she said short sale, so we tell her we cant do anything that second but we know someone that would probably purchase it, if it came down to this, but we wanted a total of what it would be for us to pay back and could we get help with interest since no one would ever give us the total before. 

She says she will try to stall it by putting it in that we agreed to short sale. (our friend did agree to purchase if had be) We were traveling through Colorado through the time and the reception was horrible and she was getting angry so we told her we would get a hotel and call her back from a landline, and to please answer. 

Within 20 mins we found a hotel and she would not pick up, or call back. We couldn't ever get a hold of her again, so we finally got a hold of her top boss who said he would try to do it for us, he said call back early the day of auction and he will have it stopped, as long as we get paper work to him within a couple days we said we would, we talked to him at either 6 or 7 am and he said he would call us back to let us know it was stopped.

We told him we could pay it all please let us and he said he had to call us back. We sent my mother up there to bid in worry they may do this, to bid on the property, if they did not stop it.  

My mother was very confused and talked to someone at the court house who showed her the attorney office that was there representing the bank.  She was told they were going to go all the way to 437,000.00 or something to insure no one would be able to buy it. 

Our home is not worth that much it is worth under 400,000.00 last appraisal. The woman told my mother that when the number was called she could bid then. We sent my mother up there with 10% down, before we knew what they were planning to do. 

Well the house number was called and the banks attorney walked up and the auction was over  THERE WAS NO BIDDING!  

The guy finally called us back 1-2 hours after auction and said sorry he got busy, and we told him what had just happened as he already knew, but we told him my mother never got to bid he said that usually happens, when banks want to work with people, and try to do another style of loan with them, and just wait for packet. 

We had nobody to contact after all this we just kept calling bank of america with no reply at all this time. The only contact we got was from a real estate woman and she said she was just hired to do regular checks to make sure it was still occupied by the owners, we even told her what was going on and she told us the same thing, that a lot of times especially with us having 4 children that the bank wants to work it out and she would also try to contact them for us, we never heard from her again. 

Just 6 days ago we were served with papers to vacate property in 5 days. Thats when we hired a lawyer.  We were scared to do it before in fear that it would just make them mad, and not work with us. 

They said it did not make sense of why it says it sold for 3, 500.00 dollars and wanted to look into it and have the ex district attorney do it also, and the fact there was never an actually bid that took place and that the woman only walked up to podium and it was over., they agreed something didn't look right.

 They have tried to contact Adock Herschell office, (the attorney representing this for BOA) only to be able to speak with LIsa, who said she would get back with them, they would call on daily basis just for her to say she still hadn't heard anything yet. 

Well when the ex district attorney came on he said, we would just sink thousands of dollars into this with the same outcome it would just buy time for us. We found out why were weren't receiving papers it was because unknown to us we were hired a curator, who the lawyers said in our file (courts papers) never showed one sign of trying to get ahold of us in these years. And that BOA had already sold our loan to The Bank Of New York in December thats why there was no auction.

We have begged the lawyers for help, because we don't see how this could be legal, but they said there is nothing illegal about underhanded foreclosure practices. 

We even got told we should of paid, even though he knows we tried, his response did you have anything in writing, which is a low blow seeing as that was our whole problem he knew we weren't getting anything. 

They told us that they gave us till the end of the month so, pretty much we should be content with that and move on. We told our other attorney we wanted to see if we could buy it back fully, our friend said he would do it for us. And our lawyer has been telling us he is waiting for an answer, that started last Wednesday. We told him we wanted it in writing that we have asked for this number and he said on Friday he would get it, well we only have till the end of the month, I've heard and read all the horror stories, about what comes next. 

The ex district attorney told us we have no case, we asked how they can act like they are having a bidding if they already sold our home a month before he said they just can. 

 We asked what about not receiving anything from the curator, he said we could have something there, but that we were just going to sink thousands of dollars into the same result. 

Why do they not have to notify us, or give us a chance to pay? They wouldn't even answer the calls to pay it. I told the lawyers we were going to contact all other outlets and they didn't have much of a response. 

So here we are, begging for help this can't be legal. This isn't just our home, this is stability, this is where our kids love, this is our family, this was all we ever wanted, and I'm being told I can't do anything about it no matter what, and they can keep doing this to anyone they choose.

We need someone to see us as people and not just more paperwork. Please help us.

Please let us know who to send this to, Im sorry it is so jumbled and messy with the writing but, it is hard to describe everything that has taken place.

Thank you,
Anr
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mike H
Reply with quote  #16 
    After reading of this unfortunate family's experience with "attempted" modification, I would like to make the following analogy.
    In the early 19th century, whaling was a major industry in this country.
The whalers would always go after the weakest whales, the ones which
for some reason, did not know how to fight back. They would always avoid
the smart, tough whales like Moby Dick, who when attacked, would ram the
wooden whaling ships they used back then, and tear the whalers apart.
    It is said by many, that the novel Moby Dick, was America's first Christian
novel, written by Melville. The analogy is this, the whales were the Christians
and the whalers were their Satanic persecuters. Most of the whales got wiped out and they became an endangered species.
    However, a few of the whales fought back, like Moby Dick, who put the
fear of God into the whalers, which eventually led to the end of the Whaling
industry and the salvation of the "whale kind".
    Whales were gentle creatures, who never harmed anyone, but it was very
profitable to hunt them. But thank God, HE Created whales like Moby Dick,
the GREAT WHITE COURAGEOUS WHALE who saved his kind from extinction by the predatory Satanists of that day.
    We need more WHITE WHALES to put an end to this predation!
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stillinmyhome
Reply with quote  #17 
I went thru the same bull with loan modification. It's a joke. The does want your house they do not want to do a loan mod. I don't quite understand how but they make their money taking your home. I had trouble to getting a lawyer but kept on looking until I found one. Contact your state attorney, your congress person, your senator, and make as much noise as you can. Local news outlets may be of  help too. Sometimes they do stories on cases like yours.
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Joe
Reply with quote  #18 
We have been fighting ourselves as pro se against the bank for over 2 years now.They have withdrawn from the process 3 times now, at various stages.
This last "round" ended with the banks lawyer sending us a letter asking us to try modification again. This came after we sent off our discovery questions.
We went thru all the same BS as everyone else with a loan mod attempt before we went pro se and started fighting, so won't bore you with the details here.
I would like to know if this is all BS all over again, OR have we come to a stage that the lawyer will advise the bank to fully cooperate with us?
Has anybody else crossed this bridge?
IS IT POSSIBLE to get a loan mod with principle reduction, late fees etc forgiven, and good rates with a lower payment? Am I in lala land here, or has anybody seen this done?
 
Thanks in advance for reading, and especially responding.
All the best,
Joe
 
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me175

Registered:
Posts: 1
Reply with quote  #19 
I'm not sure what state you are in, but there is now a mortgage modification option available in several states under the supervision of the bankruptcy court.  I'm posting a link to an article that describes the program and lists the states where the mortgage modification option is available.  If it's available in your area, it may be worth finding out if you can use it to get a modification.
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