Foreclosure Defense Mediation & Mortgage Loan Modification
Symmes Law Group offers two options for homeowners to retain primary residences outside of Chapter 13 bankruptcy which can result in placing mortgage arrears (the amount that you have fallen behind) on the back end of your mortgage loan and possibly modify the terms and interest rate of your mortgage loan. Both options involve applying through your mortgage servicer, although the Washington State Foreclosure Fairness Act Mediation does provide added protection of not being foreclosed upon while involved in the mediation process so it is the preferred and recommended route if you qualify for the mediation as outlined below. Otherwise, it is advisable to apply through your mortgage servicer.
What is Washington State Foreclosure Fairness Mediation (FFA)?
Symmes Law Group offers full representation in association with the Washington State Foreclosure Fairness Act (RCW 61.24). The Washington State Foreclosure Fairness Act (FFA) allows homeowners who own a primary residence with mortgages from non-exempt lenders to request a face-to-face mediation with somebody of authority from your lender. The mediation gives the borrower the best chance in which to receive a fast decision on a loan modification or learn about other options which may be available at the time of mediation. The mediation may only be requested by an attorney or housing counselor after you have received a Notice of Default from your lender, but within 20 days of your bank recording a Notice of Trustee Sale (foreclosure date). Here is additional information about the foreclosure timeline in Washington State. The notice of sale date will most likely be recorded at the same time that you receive notice of the sale in the mail or it is posted on your front door. If you are tired of hearing excuses after constantly calling your bank with no results in relation to a loan modification or are looking to postpone a foreclosure sale without filing for bankruptcy, give a Symmes Law Group a call today at (206) 569-6823 for a complimentary initial consultation.
How Does Our Loan Modification and Foreclosure Fairness Representation Work?
We have determined that in order to give borrowers the best chance at saving their homes or receiving a modification, a complete financial analysis should be completed to determine if requesting a FFA mediation is a good idea and has a good chance to meet your goals. There are several Federal and non Federal programs in which borrowers may qualify for and our foreclosure defense attorneys will advise you of your chances of success at mediation during Phase I of our initial review of the financial documents that you provide. These documents include:
- Notice of trustee sale or notice of default if you didn’t get a Notice of trustee sale
- Request for Mortgage Assistance Application (RMA) or other required financial application provided by your servicer fully completed
- 4506T Form
- Dodd Frank Form Signed
- Last 60 days of paystubs for both you and your spouse as well as proof of any other income received by the household
- Last 2 years of tax returns
- Utility bill showing occupancy
- Hardship letter that is signed and dated. The hardship letter should detail the reason that you fell behind on your mortgage and state what assistance you are requesting.
- Signed retainer agreement
If it is determined that you have a chance at being able to obtain a modification to save your home or you are looking to buy time in which to stop a foreclosure from happening, a foreclosure defense attorney will request a mediation date on your behalf from the Washington State department of commerce or request a loan modification from your mortgage lender, assist you in preparing the proper paperwork needed by your lender to consider your request for modification and attend your mediation if applicable during Phase II of our representation. The professionals at Symmes Law Group are well versed in the modification requirements and will present your case to the lender so that you have the best chance of receiving a modification and are within the required guidelines. Consumers who request FFA mediation and are currently involved in an active case take comfort in knowing that while they are involved in the mediation, your lender cannot foreclose on your home.
The FFA and loan modification review process can take several months to complete from start to finish and you will have a decision on whether you have been approved for a loan modification at the end of the process or whether you will have to make other arrangements. After your FFA mediation is requested by your attorney or housing counselor with the state of Washington, the department of commerce will assign a mediator in your county to assist with your case. The mediator’s duties include organizing communication between all parties and offering a neutral location in which to have the mediation sessions. The mediators charge a fee of $300 per session for their involvement in your case. At the time of the FFA mediation request, your lender will be notified and local attorneys who represent your lender will be assigned to your case. These attorneys usually come from large foreclosure law firms and seek to represent the best interest of your lender. Your foreclosure defense attorney during this process must communicate constantly with the attorneys representing your bank to make sure your lender has all the proper documents needed in order to review your case. If any documents are missing from your initial package submission the banks attorneys will be sure to let your foreclosure defense attorney know and it will be your responsibility to gather up the requested documents.
Why Should I Hire A Seattle Foreclosure Defense Attorney?
One of the biggest problems consumers face in attempting to get a loan modification is submitting complete modification packages that include all the information the banks are requesting. The banks can be very nitpicky and if a document is missing a signature or is not filled out correctly, they will send it back and say it is not complete. Further documents can become stale if it has been more than 60 days from when the docs have been signed or provided. This can frustrate consumers and cause modifications to not be approved. The second biggest complaint by consumers is that the banks lost all of your documents that you submitted. Consumers report submitting documents again and again, yet banks say they have not received them which cause a loan modification to be denied.
There are several guidelines and rules that your lender must follow and your foreclosure defense attorney will make sure that your documents are submitted correctly and in a timely fashion, but of course you have to do your part in providing the correct documents requested. Further having a mediator involved and by participating in the FFA mediation process you are able to hold your bank accountable. Instead of you attempting to submit docs to the bank which the bank says they did not receive, you have a mediator, your own foreclosure defense attorney, local attorneys for the bank, and somebody of authority, usually and underwriter for the bank, all reviewing your documents in a timely fashion and being held accountable to make sure your documents are reviewed prior to a mediation being held. it is in your best interest to submit a loan modification package as soon as possible to make sure the bank has enough time to review your package and request any additional information that is necessary.
What Can I Do If I am Not Approved For a Loan Modification?
Banks are not required to approve you for a loan modification in most cases. All banks complete what is referred to as a waterfall analysis which means you are reviewed for several federal and in house modification programs that are available to borrowers. Essentially the banks must make a business decision as to whether it is in their best interest to approve a loan modification or proceed with a foreclosure sale. Therefore, if there is significant equity in your home and you cannot show an ability to make mortgage payments moving forward it may be more difficult to obtain a loan modification. With that said there are other options out there for you to avoid a foreclosure sale.
- Your lender may have a cash for keys program. This allows you to surrender your home back to the bank and walk away from your loan and in some cases your bank may even pay you to leave your home. This is also called a deed in lieu of foreclosure to avoid having a foreclosure on your record.
- If your home is under water (has no equity), you could attempt to negotiate a short sale with your lender where the bank agrees to take less than the full balance on the loan if you have a buyer lined up.
- If you are looking to keep you home a Chapter 13 bankruptcy allows for debtors to make up arrears over the course of 60 months (5 years). This would require you to have enough income every month in which to pay your normal mortgage payment as well as your arrears over the course of your chapter 13 bankruptcy plan.
- If you determine that your lender has violated mortgage laws or is involved in predatory lending you can file a lawsuit requesting that the bank be prohibited from foreclosing due to the unlawful practices. This route can be costly and time consuming and is not guaranteed to get a result. It should be used as a last resort and you should consult with a predatory lending attorney to determine if it may be an option. If your lender did not participate in the FFA mediation in good faith, this would require your lender to judicially foreclose on your home and can be used as an argument against your lender. Filing a lawsuit is not something you will want to wait to do until the last second to do as litigation takes significant time and planning.
- If you have significant equity in your home it may be in your best interest to sell your home either on the MLS or to a third party off market in order to maximize the amount of return you get before a foreclosure sale is completed. Symmes Law Group provides an experienced real estate attorney as well as a managing real estate broker to assist in any sale of your home if needed and can provide you with all of the options to discuss the best outcome for you.
- Allow your home to foreclose and obtain surplus funds post foreclosure if any from the superior court post foreclosure. If you take no action your bank will file documents notifying you of the completed foreclosure sale and possibly notice of surplus funds at your last known mailing address if applicable. You can live in your home rent free and 20 days after the foreclosure sale and in the meantime make arrangements to live elsewhere and possibly hire a surplus funds attorney to recover any surplus funds.