Tips, Hints & Suggestions
Paperwork Loan Modification Hell
Get ready to send in reams and reams of paperwork. (Here's my tally so far.) They'll ask you for the same forms over and over and over again. They'll say they lost them. They'll try to make you think you didn't send them.
Honestly, I don't mind the lenders asking us to jump through a few hoops. It should take a little time and some effort to secure a modification. And it's reasonable to ask for documentation. It's even logical to ask for some things to be updated during the process - profit-and-loss statements, financial worksheets, any other forms on which the numbers might change month to month. (Though it's still outrageous for reviews to go on month after month after month).
But would someone please tell me why on earth Wells Fargo needed five copies of my 2009 IRS 1040? It's not like the numbers on that change after it has been sent to the IRS. And if they did have some notion I was fiddling the numbers, they had four different copies of the IRS 4506T-EZ, which authorizes them to request forms from the IRS just to check up on me. Asking for these forms over and over again is an institutional, top-down strategy to try to get people to give up in disgust and let the banks get on with taking their homes away. There's no other logical explanation. (I wonder whether this naive blogger has caught on yet. He's clearly not too bright, but many who commented are on top of the issue.)
1. Play the game.
Make up your mind from the outset that you are going to bury them in paper. Helpfully send them every single form and document they ask for, as many times as they ask for it. Call at least once a week and have the pleasant customer service people check the electronic notes on your review and tell you whether anyone involved has indicated a document is missing. You'll probably only be notified once in a while in writing which documents are needed. Instead, once your review gets rolling, you'll probably get an "auto-dialed" call from customer service several times a week. Sometimes the reps have no idea why they're calling - the notes indicate that all the paperwork is up to date. Other times they'll tell you that you need to send something in. Just send it (via certified mail or some other method that provides delivery confirmation.) Here's a preview ... this is a bank jerking a realtor around regarding a short sale, but, trust me, this scenario will become very familiar to you as you pursue a mortgage loan modificaton.
Short Sale Hell
It seems the number one reason the banks use to justify when otherwise qualified people get turned down for HAMP and in-house modifications is that the borrower didn't submit the necessary paperwork. I got two identical but completely bogus letters telling me I had been turned down for a modification very early in the game. And the reason given in both the April 7 and May 7 letters had to do with paperwork. You'll start to notice that a line or a paragraph about the need to keep paperwork up to date appears in most of the correspondence you recieve. It's the loan servicers' big loophole, the excuse they all seem to use to justify why we stupid borrowers just don't deserve to have our mortgages adjusted. That's a big load of BS, and highly ironic given recent developments with robosigners and foreclosure fraud. So keep a record of every single document you submit. I generally did this by writing a cover letter to go with every mailing and including a checklist on the letter of each item included in the package. I found that helpful for myself when sending large numbers of documents in one package. (One mailing I sent included 52 pages, many of which were printed on both sides!)
2. Fill in every line of every form.
I found out more than six months into my review that several of the forms - mainly the RMA - are read by an optical scanner at the Treasury Dept. and if there is even a single blank line, the form won't be read. That means you should either draw a line through form boxes or spaces that aren't relevant to your situation or write in "N/A" (not applicable.) Again, this information is not printed on the forms, it's nowhere to be found on the Wells Fargo website pages about mortgage modification and nobody ever told me that in all these months of submitting and resubmitting paperwork.
3. Sign and date every single piece of paper you send.
Yes, that even means forms that do not have a space for a signature and date. I was several rounds of paperwork into the process before one of the helpful phone queue folks told me "the investor" required that every document have a signature and date. He also suggested that each document needed to have my loan number on it. I ended up printing up several sheets of small labels (1/2" x 1-3/4" Avery 8167) with my name and loan number so I could stick one on every page of every mailing. Then I would sign and date under the label. I thought of that as "idiot-proofing" my paperwork. Anything to thwart their desire to blame me for a failed review based on missing forms.
4. Update your initial paperwork every 30 days.
Again, I was several rounds of paperwork into the process before one of the helpful phone queue folks told me "the investor" required the RMA, financial worksheet and hardship letter be updated every 30 days, whether or not the information changed. The date just had to be "refreshed." Later on, I was asked to do the same with my business' profit-and-loss statements.
That's another bit of info. that isn't on the forms or available anywhere in writing in any Wells Fargo source I could find, nor in the Freddie Mac servicer agreement. (Are you getting the gist of this? If they really wanted you to apply for and qualify for mortgage assistance, they would surely make the process much more simple and transparent, don't you think? They keep all these little technicalities secret so they have a reason to turn you down.) This is one of those requirements you might want to ask about every so often. Recently a Wells Fargo phone queue person told me that 30-day requirement had been changed to 60 days. I asked other folks for confirmation and got several answers, including both 30 days and 50 days (which makes no sense at all! from people in the office of the president. As I say, do not believe what they tell you. Check and double check and when in doubt, just mark your calendar to send your forms every 30 days.
(More on this topic on my Lies page).
Watch the video on this page for a more comprehensive list of paperwork needed for an initial inquiry about mortgage modification than those you'll find on your lender's website or the official HAMP site.