Do It Yourself

Should I try to do this myself?

You can try to do it on your own.

Keep in mind the bank is NOT your friend.

We understand that families

who are in foreclosure 

are experiencing very difficult times.

Extremely high levels of stress
cause sadness and confusion,
Do NOT make your family suffer. 

The IAFPP understands how difficult it is

for you and your family to weather such a storm.

Congress recently passed laws

that give consumers special rights

to help them workout their loans.

Let's Get Started!

To have any hope of a successful mortgage workout plan, you are going to have to prepare for the fight of your life,
foreclosure defense is no easy battle.

So get your sweats on and start training.

Understand that you are about to take on the Banks,
the financial world champions.

The banks have the experience of over 200 years,

We have discussed previously in the loan modification report
and the pros and cons of attorney representation,
just how hard the banks are to work with
and the multiple protective layers
they have set up to protect themselves
and keep you at bay.

This fight you are taking on...

• has to be strategically planned 
• you will need education on the rules of engagement
  before you enter the ring.

One of the problems
that makes loan workouts so difficult to process
is that each lender maintains different criteria
for granting a loan workout plan.

Not only that,
but consumers are painfully aware
that when they call their lender
they are often transferred around
from person to person
and sometimes
from department to department
within a lending organization
before they get to anyone
that can clearly answer a consumer’s question.

First you need to acquire
an immediate understanding
of what your lender needs
in the home loan workout process. 

The lender may create a specific workout plan 
in order to work with the homeowner
because of a hardship.

The purpose is to help make the loan(s) more affordable.

Usually loan workouts
are in the form of a rate reduction
and/or fixing the rate for a certain period of time,
extending the term of the loan,
and applying the arrearages to the principle of the loan.

Borrowers can usually obtain workout plans 
from their lender
for unaffordable rate adjustments
on adjustable rate mortgages.

The earlier the homeowner addresses the issue,
the better the chances are
of negotiating a fixed rate
and a payment that is manageable.

If the homeowner can afford their home
but not their current mortgage
then they may be eligible for a loan workout plan.

The Harship Letter:

Keep this in mind when you write a hardship letter.

Documenting the hardship is very important
to the lender’s or servicer’s
loss mitigation department
and will be verified during the approval process.

Without proper documentation,
your file may be flagged as fraudulent.

You definitely do not want this to happen
for obvious reasons
and it will slow down the process
or terminate the process completely.

Notice that
"My Realtor lied to me"
and
"My loan officer/broker lied to me"
is not on this list.

They are not acceptable hardships
so don't use them. 

A key factor that is required
in every loan workout submission
is the existence of a hardship.

The hardship can be temporary in nature
or permanent,
but the borrower
must be able to prove the hardship.

The following are a sample of hardships
that can get loan workouts approved:

while this list is specific, it may or may not contain the hardship you have suffered,
and listed or not does not mean that it will meet the requirements or process of an individual lender.

Many workout requests fail
because the homeowners
can not tell their story in a simple way.

It is easy to forget there is a real human being
analyzing the hardship letter
within the lender’s or servicer’s
loss mitigation department
who is responsible for determining
the existence of a real hardship.

With that said you must keep your hardship letter simple
and get to the point quickly.

Loss mitigation departments
are overwhelmed with foreclosures, short sales,
and modification requests.

They do not want to read a ten page letter
regarding the loan officer who put you in the loan,
why you bought the house,
the memories you have had there
and why you want to keep the home.

When writing the hardship letter,
keep the letter simple,
stick to the facts and to the point.

In addition, handwrite the hardship letter.

The fact is that people personally relate
to handwriting more than a typewritten letter
and this includes the lender’s or servicer’s loss mitigators.

You can view sample harship letters on the forms page.

Each lender has specific forms, documents and process
that they require in the loan workout process.

Documentation Required (usual)

while this list is specific, it may or may not contain the specific form, document or process to an individual lender,
Ask your lender if they require specific forms and documents.

Preparing The Workout Package

After you have written the hardship letter,
you will need to complete a financial statement.

You can download sample financial statements
on the forms page.

Next, you will complete an income and expense worksheet,

You can download a sample income and expense worksheet on the forms page.

Then write a sample loan workout request.

 You can download a sample workout request letter 
on the forms page.

You will need to include documentation of your home’s value.
You can obtain reliable documentation
of your home’s value from;

EVERY single page in the package is required to have specific information on the top of each page;

The sunmitted tax returns
need to be signed and dated again in the margin,
at the time they are submitted with the workout package
in 'BLUE INK' to verify them.

The pages of the workout package
need to be placed in a specific order
before submitting them.

The following is the order we use;

Another More Aggressive Aproach:

The use of forensic audits
can give you the upper hand with your lender...
see forensic audit loan workouts 

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