Mortgage Modifications Get Some Real Help

mortgage modificationsSince California passed its new law mandating how lawyers can be paid for helping with mortgage modifications, Californians are finding it difficult to get assistance.

Charles Martin used his 19 months of fighting for a mortgage modification for his own home in California to learn the ropes and now helps others, not only in California, make their way through the maze of obstacles put up by the banks.

Martin started working on his mortgage modification in June 2009. He learned a lot along the way and made a lot of good contacts with key people not only in his bank, but in other banks as he tried to help others. He thought the more he "paid it forward" by helping others, he may finally get a successful mortgage modification himself.
As an experienced sales person, Martin believes strongly in the theory of VITO, getting to the very important top officer. Today he has contacts with Executive Response Units at the three largest loan servicers, Bank of America, Chase and Citigroup. He's not a lawyer, but does help people as a consultant to successfully navigate the mortgage modification maze.

What he does for people is to help assess their financial situation and determine if they really could qualify for a mortgage modification. If they do, he works with them to get to the right people at their bank. Sometimes he'll make the call, other times he empowers people to do it themselves.

He's found the key "sweet spot" for qualification is the housing ratio. This ratio determines whether or not
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you earn enough to get a mortgage modification. It also looks at whether you earn too much to qualify. You can calculate your housing ratio by totaling your mortgage payment, any second mortgage payment, any homeowner's association fees, monthly insurance costs and monthly taxes then divide that by your monthly gross pay. If your ratio falls between 40 percent and 49 percent, you are in the sweet spot and have a good chance to get a loan modification.

If your income is higher and you fall below 40 percent, you have less of a chance of getting a mortgage modification because you earn too much and if its higher than 49 percent you likely don't earn enough to qualify for a mortgage modification. There are always exceptions to this rule, but he finds he has the most success helping people who fall in the "sweet spot." You can ask him for help by emailing him at

Another key program now available nationwide is, which is a software program that helps you fill out the paperwork for a modification. Attorney David Galanter developed this free website that walks you through a do it yourself home mortgage modification process. He calls it the "Turbo Tax for loan modification." As you enter the data, pop-ups help you fix any errors as you fill out the paperwork. For those who don't want to do it yourself, he's developing a nationwide network of attorneys and others that can help you through the process.

Abraham (Avi) Borenstein, an attorney for 30 years that founded a firm based in New York and New Jersey, said the key to any modification application is "persistence and patience." The system as currently designed does not "effectuate modification. Banks view it better to foreclose than to modify."

He thinks the winds could be changing as courts around the country take a closer look at banks' foreclosure practices. For example, he cited the ruling by the Chief Justice of the New Jersey Supreme Court, Stuart Rabner when he told six lenders that they must answer to him in court or have their foreclosure actions suspended. Rabner wrote in that decision that the court "has become increasingly concerned about the accuracy and reliability of documents submitted to the Office of Foreclosure." After this hearing he could appoint a special master to deal with foreclosure cases from these six banks including Wells Fargo, JP Morgan Chase and Citibank.

Florida's Supreme Court mandated mediation before foreclosure, but Florida attorney Charles Castellon said that order is being handled differently county by county. Some counties are truly reaching out to borrowers to let them know about the mediation, but others bury it in a slew of paperwork sent to borrowers.

He's found that the temporary mortgage modifications offered borrowers usually do not work out. He recommends to his clients that they not accept any type of temporary mortgage modification, but instead work toward a permanent mortgage modification. He's found that he gets the best terms when he gets the court to order mediation during a foreclosure action. At that time he has the attention of the courts and the legal staff of the bank and he finds he can get a better modification deal.

Castellon thinks of the current mortgage modification process done outside the court system as a "Kafkaesque nether world of dealing with lenders losing paperwork." He's seen very few successes with the HAMP modification process.

If you've been trying to get a mortgage modification and continue to find frustration in the "Kafkaesque world" of modification, stop trying to go it alone. You need the help of a third party, whether it's an attorney like Borenstein or Castellon, or an advocate such as Charles Martin. You can also get help for free from a HUD housing counselor. The key is not to give up in frustration if you want to save your home.

Lita Epstein has written more than 25 books including The 250 Questions You Should Ask to Avoid Foreclosure and The Complete Idiot's Guide to Personal Bankruptcy.

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