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Mortgage Loan Modifications

Many home owners lost their jobs or had their incomes severely reduced during the COVID epidemic. As a result, thousands of New York homeowners, if not tens of thousands, have fallen further and further behind in their monthly mortgage payments. Fortunately, since March 20, 2020, foreclosures have been paused in New York State, first by executive order and then pursuant to the COVID-19 Emergency Eviction and Foreclosure Prevention Act of 2020. The foreclosure moratorium is currently set to expire on August 31, 2021.


No one knows what will be in store for homeowners who are behind on their payments once the foreclosure moratorium expires. Will they all be given a deadline to catch up on their payments? Will they all be hauled directly into foreclosure court? Even if they are given payment plans, who can catch up on 18 months worth of missed mortgage payments?


It is my belief that banks will allow homeowners who haven’t paid their mortgage during the moratorium to apply for mortgage loan modifications that will keep their monthly mortgage payments at an affordable level while putting their arrears into an interest-free lump sum that will sit at the back of their modified loan until the house is sold, the homeowner dies, or the front-end part of the mortgage is paid off. This arrangement was commonly used before the pandemic, and in my experience it led to a fair share of successful modifications.


If you have filed a bankruptcy petition with me, we can apply for a mortgage loan modification through the bankruptcy court’s loss mitigation program. 


If you have received a summons to appear in foreclosure court, I no longer practice foreclosure defense, but if you are appearing pro se, meaning you will not be hiring an attorney but will be representng yourself, you can hire me just to do the loan modification and appear at loan modification hearings. 


Finally, if you are not in bankruptcy client nor in foreclosure court, and you want to proactively apply directly to the bank for a loan modification, I can do this for you as well.


As you can see from the statistics cited on my home page, I have had considerable success with loan modifications. No one can promise that you will get a loan modification, but I can tell you that my success rate has a lot to do with being very familiar with COVD 19-related laws and regulations as well as Regulation X’s Qualified Written Request / Notice of Error procedures that were very helpful to homeowners before the pandemic and will be again once the moratorium has been lifted. 


When I work on loan modifications for my clients, I insist on two things: First, that we are very thorough and exact in your initial loan modification application, and second, that we are very, very quick in providing the bank with any follow-up documents they might ask for. When the bank asks for something, my policy is to get them what they want within 24 hours of receiving their request, no matter how many requests they make. 


That’s not as easy as it sounds. For example, at the start of the loan modification process, the bank will ask you for financial documents such as paystubs and bank statements. Then a month or two later they will ask for updated paystubs and updated bank statements. Then a few months later they will ask again. And maybe still again. It happens all the time. Why? In my opinion, it’s because they are trying to discourage and frustrate you and they are trying to make you go away. We have to show them that we are serious and we won’t be discouraged and we won’t give up. 


My fee for loan modification application made through the bankruptcy court’s loss mitigation program by my bankruptcy clients is $2,000.


My fee for loan modification applicants who are representing themselves in foreclosure court and who wish to hire me to apply for a loan modification through the foreclosure court’s loss mitigation program and appear at related hearings is $2,500, plus $500 for any in-court appearance and $250 for any telephonic court appearance.


My fee for loan modification applications for persons who are not in court but want to proactively file a loan modification with the bank is $2,500 for the first three months of the process and then $500 for every month after that, up and including the sixth month. 


In any case, the fees described above cover the application process up until (i) you receive an offer of a loan modification, whether you accept it or not, or (ii) you receive a denial of your loan modification application, in which case the fee will include one appeal of the denial.

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