Mortgage Modification Survival Kit

An outdoor survival kit might contain a Swiss army knife, a lantern, and a lighter. Unfortunately, these tools are powerless to help you survive a journey through the wild landscape of mortgage loan modification. 

The Home Affordable Modification Program (HAMP) has been around long enough to show its weaknesses. Many homeowners have complained that banks are disorganized, unresponsive, and unrealistic in the handling of modification requests. And there’s data to support these claims. A May 2010 report indicated that only about 50 percent of homeowners in the trial phase were being converted to permanent modifications.

Knowing this, you should be prepared to accept and manage the rugged terrain that lies between you and your permanent loan modification. The good news is that you already have the tools needed to get to the other side.

Professional attitude

Start by evaluating your attitude. A relaxed and professional one can keep you focused on moving forward through the process. On the other hand, if you’re feeling desperate, you’ll be increasingly anxious with every phone call that’s not returned or document that gets lost. Set aside your emotions as much as possible. Think of your modification only as a series of tasks to be completed. When the tasks run off course, don’t get caught up in why—just focus on getting things back on track.

System of organization

Prepare yourself to log and track every phone call and piece of paper that passes between you and the bank. A spreadsheet is convenient for this purpose, because you can search your notes by keyword later on. You should also record your information in a spiral notebook. For every call and phone message, write down:

• Date and time
• Summary of the conversation
• Names of everyone involved

Whenever you fax or mail documents, make a note of the:

• Documents sent
• Number of pages
• Address or fax number
• Name of the person receiving the documents
• Way in which the documents were sent

For faxes, print out a confirmation report from the fax machine and keep it with your records.

Set aside an hour or two daily during which you can work on tasks associated with your modification. Use this time to gather documents, make phone calls, and record your correspondence. By building this time into your schedule, you are controlling the process and not letting it control you. 

A keen set of eyes

Read all correspondence and modification documents very carefully. You don’t want to miss any document requests, or accept a modification that’s inappropriate or unaffordable. If your bank presents a modification contract that seems unreasonable, it’s better to request different terms than risk defaulting later. 

Securing a permanent mortgage modification can be as grueling. Remember that few big tasks can be accomplished without the right tools, and mortgage modification is no exception.