HAMP Success: Mortgage Modification Works Great For This Debtor
There have been several newspaper articles in the past month criticizing the HAMP mortgage modification program. I read an article stating that only twenty five percent of HAMP applicants achieve permanent mortgage modifications. Some politicians have expressed that HAMP should be terminated nationally. To be fair, some people have greatly benefitted from a HAMP mortgage modification.
One couple I know achieved a significant permanent modification of their mortgage with a large mortgage bank. About a year after the initial modification, the bank sent them an unsolicited letter inviting them to apply for a second modification. The bank said that the decrease in household income the couple experienced after the first modification might qualify them for more modifications. They applied, and it worked.
The second mortgage modification included a further reduction in the monthly payment and a seventy five thousand dollar principal reduction. If the couple made timely payments of their mortgage payments for three years the bank would permanently write off $75,000 from their mortgage. The reduced mortgage payment would be less than this couples original purchase mortgage. What the bank was doing was eliminating all the deferred interest, fees, and cost which had been added to the mortgage principal because of late payments and the initial modification plan.
Have hope. Mortgage modification is very difficult, but it is possible.
