As a residential Broker in Northern Nevada, having sold hundreds of homes over 18 years, I’m getting lots of calls and emails with questions about loan modification. These are real people with big problems and I’m frustrated:

 “I lost my job”

“I went through a divorce, got raked over the coals, ended up with the house”

“My interest rate’s about to adjust”

“I can’t refinance because I owe more than it’s worth”

 This may sound heartless but the list goes on & on & on… I for one feel a great sense of obligation to provide some help and/or guidance to these homeowners. Beyond the eventual short sale I have had very little success in providing loan mod assistance. In fact I can say that I’ve yet to see one meaningful success story after sending dozens of homeowners on this quest. At the risk of sounding cynical but here’s some of what I have seen:

 The 3rd party, Loan Modification Experts: These folks usually charge up front, often $2,000 – $3,000 or more. They have a legal team or it may actually be an attorney. They have expert negotiators on staff and they speak the language of banks. Again I’ve yet to see any meaningful success from this group. In fact I haven’t seen anyone perform a task that the homeowner couldn’t have completed themselves. Wouldn’t it be nice if someone were to charge based upon results and performance? Please share any positive experience..

  • Avoid Foreclosure, We buy houses: These guys do provide an obvious public service, think of how many sign companies they’re supporting? Seriously, I’ve called several and talked to: Licensees fishing for short sale listings, Investors looking to for a contract of sale, Investors offering to negotiate a short sale while coordinating a concurrent “flip” to a new buyer. Again there could be some legitimate people out there, I just haven’t seen them. Please share….
  • Let’s call the bank directly: First problem; you’re typically talking to the collection department. These guys are born to, well, collect. Second problem; Imagine going to the bank for a new loan. You must go 25 times and each visit you talk to a new person to whom you must tell your entire personal story. Each representative responds a little differently. How many loans would we close with that system? Enough said.. I’m looking for positive experiences… 
  • Where’s the bailout money?: I recently heard these statistics from a very smart guy and I believe him. He said that of the loan modifications made to date, 80% go back into default within 12 months, 40% never make another payment. My understanding is that the federal money offered to banks for making modifications primarily kicks in when the homeowner actually makes his/her payments. If the above numbers are correct, no wonder the mortgage holders are not making a more concerted effort. I’d love to hear a different story…

 My goal in posting this is to gather some good news. Success stories that I can share with anyone that will listen. More importantly, I’d like to share with those that really need it. Please comment.