Mortgage Loan Blog

Getting a Loan Modification from Countrywide (now Bank of America) is a time intensive, tedious process, arduous, extremely difficult process, and it is strongly suggested that you retain representation rather than attempt to fight foreclosure on your own.
Below you can find all

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Article Content:
Getting a Loan Modification from Countrywide (now Bank of America) is a time intensive, tedious process, arduous, extremely difficult process, and it is strongly suggested that you retain representation rather than attempt to fight foreclosure on your own.

Below you can find all of the information that you need to successfully get a loan modification with Countrywide or Bank of America, including all necessary contact information, the process, types of modifications being granted by Countrywide and B of A, and the required documentation. If you need assistance, please fill out the contact form on the right, we will contact you immediately.

Countrywide was the King of subprime mortgage lending, and they definitely play dirty when it comes to granting loan workouts. Here is some information that should help you with the fight.

The Countrywide Loan Modification Process
How to Contact Countrywide’s Loss Mitigation Department
Countrywide Hardship Letter
Countrywide Complaint Letter
How to Still Make your Payments
Types of Countrywide Loan Modifications
Required Documentation
A Must See

Countrywide Loan Modification Process


Here is a breakdown of the loss mitigation process when dealing with Countrywide:

Write a Hardship Letter and begin gather the required supporting documentation.
Contact Countrywide’s Loss Mitigation Department and advise them that you are facing financial hardship and can no longer afford your mortgage. They will provide you with a number of additional confusing forms. Don’t get discouraged!
Fax your Hardship Letter, Financial Prospectus, Income Documentation, Bank Statements, et. al. to the fax number provided.
(Optional) Write a Qualified Written Request or a Complaint Letter & submit to Countrywide. Now it’s time to wait 90-120 days for a negotiator to get assigned.
Have a clear goal of what you want to achieve through your loan modification / what you would like your new payment to be. Speak politely but firmly to the negotiator that has been assigned to you and state plainly what you hope to achieve through the modification.
Receive your loan modification offer via mail from Countrywide per the terms agreed upon with the negotiator. Sign and send back.

How to Contact Countrywide’s Loss Mitigation Department
Main Loss Mitigation Department Number: (800) 669-6607
Direct Phone Number to Countrywide’s Legal Department: (972) 526-3610 – Mary Archer, paralegal
Direct Phone Number to Countrywide’s Office of the President: (800) 601-2522

3. Countrywide Hardship Letter
Start off with a basic business letter template. Your first paragraph of the hardship letter must contain details about your current financial situation – let the lender know that you are not comfortable with the current loan terms and let them know that you need immediate help.

Second paragraph: Explain about your hardship in more detail here.

Third Paragraph: Explain how you will benefit from the loan modification.

Fourth Paragraph: Explain that you are committed to saving your home. Conclude with a statement that you look forward in working out a solution that will help avoid foreclosure.

Do not let Countrywide take your home! Fill out the form to the right for expert assistance.


4. Countrywide Complaint Letter
Be sure to include a “Qualified Written Complaint” to Countrywide. Example can be found courtesy of HUD – http://www.hud.gov/offices/hsg/sfh/res/reslettr.cfm.

Address for Certified Complaint Letters:

OFFICE OF THE PRESIDENT
ATTN: ADRIENNE ELY
400 COUNTRYWIDE WAY
MS SV-314
SIMI VALLEY, CA 93065
800-669-6093

Countrywide Mortgage
400 Countrywide Way SV-HRD
Simi Valley, CA 93065

400 Countrywide Way SV-314
Simi Valley, CA 93065-3500

400 Countrywide Way SV-314
Simi Valley, CA 93065-3500

450 American St
Simi Valley, CA 93065
7105 Corporate Dr.
Plano, TX 75024

P.O. Box 10211
Van Nuys, CA 91499
P.O. Box 5170
Simi Valley, CA 93062-5170

21 E. Victoria Street
Santa Barbara, CA 93101
35 North Lake Avenue, 35-72B
Pasadena, CA 91101

Countrywide
SV-314B
PO BOX 5170
SIMI VALLEY, CA 93062-5170

How to Still Make Your Mortgage Payments
Countrywide loves to make additional money through charging fees and not accepting payments through their online payment system from people that are going through loan modifications. One way to get around this is through http://www.checkfree.com, which will give you proof of payment that you can forward to your neighborhood friendly Attorney General’s Office.

Types of Countywide Loan Modifications
Countrywide National Homeownership Retention Program

This home retention program underscores Bank of America’s commitment to provide customers the resources and necessary help to sustain homeownership. It is estimated that the loan modification program will result in up to .4 billion in permanent payment relief to as many as 400,000 Countrywide borrowers nationwide. In states participating in the program, it provides up to 0 million in relief payments to borrowers who default early in their loan terms or after an interest rate reset, while committing more than million to a relocation assistance program to help borrowers who are unable to retain their homes with relocation costs. Countrywide has initiated proactive outreach to eligible borrowers.

Countrywide no longer offers “subprime,” “high cost” or “negative amortization” mortgages and has significantly curtailed no- and low-documentations loans. Broker compensation will be limited to 4% of the amount borrowed. Countrywide will retain, for at least one year following the acquisition by Bank of America, a minimum of 3,900 personnel to assist with loan modifications and other foreclosure avoidance and home retention measures. We will continue to proactively contact delinquent borrowers and offer loan modifications and report the progress of this agreement to the participating states on a regular basis.

Home Retention Programs – On December 1, 2008, Countrywide began proactively contacting potentially eligible borrowers under this program. Countrywide has not initiated or advanced foreclosures for potentially eligible borrowers during the time necessary to determine borrowers’ interest in staying in their homes and their ability to afford the new terms as well as investors’ willingness to accept loan modifications.

Countrywide will waive late/delinquency fees for payments remaining unpaid when modifying loans and will not charge modification fees to borrowers. Countrywide will waive prepayment penalties in connection with any payoff or refinance on certain qualifying subprime and PayOption ARM loans owned by Bank of America or Countrywide. For loans owned by other investors, Countrywide will work with investors to encourage them to waive prepayment penalty fees.

Eligible borrowers under this program must have received a qualifying subprime mortgage or a Pay Option adjustable rate mortgage prior to 2008, and the property must be a 1-4 unit owner-occupied residential property. Additional requirements include:

The borrower is 60 days or more delinquent and the current loan-to-value ratio is 75% or above;
The borrower becomes seriously delinquent at any time prior to June 30, 2012, and the loan-to-value ratio at the time of the modification is 75% or above;
The borrower is current on the mortgage but is likely to become seriously delinquent as a consequence of a rate reset or contractual payment recast based on negative amortization triggers, and the loan-to-value ratio at the time of the modification is 75% or above.

Loan Modification Program Details

Countrywide will offer eligible borrowers an FHA refinance under the HOPE for Homeowners Program to the extent available, as well as these additional program options based on product type:
Subprime 2-, 3-, 5-, 7- and 10-Year Hybrid ARM borrowers who become seriously delinquent following an interest rate reset will receive an unsolicited restoration of the introductory rate for five years and an invitation to contact Countrywide for additional relief if they are unable to afford the introductory rate. Borrowers who cannot afford the introductory rate will be offered one of the following streamlined loan modifications within the limits of the Affordability Equation:

A fully amortizing loan modification with an interest rate reduction to the introductory rate or lower with fixed step-rate interest adjustments such that the borrower’s aggregate scheduled principal and interest payment increases by no more than 7.5% of the aggregate scheduled payments in the preceding year; and an automatic conversion after five years to a fixed rate mortgage for the remainder of the loan term.
An introduction of a ten-year interest only period and a reduction of the interest rate on the mortgage with fixed step-rate interest adjustments such that the borrower’s principal and interest payment increases by no more than 7.5% each year, and subject to a lifetime interest-rate cap of 2 percent below the original loan’s contractual rate.

Pay Option ARM borrowers qualifying for and accepting a streamlined loan modification option will have the negative amortization feature eliminated from their loan. For single property owners who currently have an LTV of 95% or higher, Countrywide may defer or write-down the principal balance to as low as 95% of the current value of the property to restore an equity position. Based on the Affordability Equation, Countrywide will offer a fully-amortizing modification consisting of:

An optional ten-year interest-only period on the loan; and
Reduction of the interest rate with fixed step annual rate adjustments, subject to an interest rate cap.
Other Subprime borrowers will receive a streamlined modification based on the limits of the Affordability Equation consisting of a fully amortizing loan modification with an optional ten-year interest-only period on the loan; and reduction of the interest rate with fixed step annual rate adjustments, subject to an interest-rate cap.

Affordability Equation

Foreclosure Avoidance Budget: The difference between the likelihood and severity of the investor’s projected loss in a foreclosure sale and the likelihood and severity of the investor’s projected loss in the event the borrower were to receive a loan modification and later experience a foreclosure sale.
Affordability Criteria: To the extent permitted by the Foreclosure Avoidance Budget, borrowers will be offered a loan modification that produces a first-year payment of principal (if applicable), interest, taxes and insurance equal to 34% of the borrower’s income or as close to 34% of the borrower’s income as the Foreclosure Avoidance Budget permits without exceeding 42% of the borrower’s income. For those borrowers who do not escrow taxes and insurance, we will offer a loan modification that produces a first-year payment of principal (if applicable) and interest equal to 25% of the borrower’s income, or as close to 25% of the borrower’s income as the Foreclosure Avoidance Budget permits without exceeding 34% of the borrower’s income.
Failure to Qualify under the Affordability Criteria: Borrowers in participating states who do not qualify under the Affordability Equation may be eligible for a payment under the foreclosure relief program and/or relocation assistance.

Foreclosure Relief and Relocation Assistance Programs

These additional programs are available to Countrywide borrowers in states participating in this agreement. Currently, they are available in the following states: Alaska, Arizona, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Maine, Maryland, Michigan, Mississippi, Montana, New Mexico, Nevada, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Virginia, Washington, West Virginia, Wisconsin and Wyoming.

Foreclosure Relief Program

Countrywide will allocate up to 0 million nationally under a foreclosure relief program to provide relief for borrowers whose loans were originated directly by Countrywide (or through brokers) between 2004 and 2007. Funds will be allocated to each participating state based on the number of eligible borrowers in the state.

Relocation Assistance Program

Countrywide borrowers who experience a foreclosure sale of their property and who agree to voluntarily and appropriately leave the premises will receive a cash payment to ease their transition to a new place of residence. Countrywide anticipates paying greater than million to more than 35,000 borrowers in participating states under this program.

Making Home Affordable Guidelines & Program Details In Depth

The Home Affordable Modification program will help up to 3 to 4 million at-risk homeowners avoid foreclosure by reducing monthly mortgage payments. Working with the banking and credit union regulators, the FHA, the VA, the USDA and the Federal Housing Finance Agency, the Treasury Department today announced program guidelines that are expected to become standard industry practice in pursuing affordable and sustainable mortgage modifications. This program will work in tandem with an expanded and improved Hope for Homeowners program.

With the information now available, servicers can begin immediately to modify eligible mortgages under the Modification program so that at-risk borrowers can better afford their payments. The detailed guidelines (separate document) provide information on the following:

Eligibility and Verification:

Loans originated on or before January 1, 2009.
First-lien loans on owner-occupied properties with unpaid principal balance up to 9,750. Higher limits allowed for owner-occupied properties with 2-4 units.
All borrowers must fully document income, including signed IRS 4506-T, two most recent pay stubs, and most recent tax return, and must sign an affidavit of financial hardship.
Property owner occupancy status will be verified through borrower credit report and other documentation; no investor-owned, vacant, or condemned properties.
Incentives to lenders and servicers to modify at risk borrowers who have not yet missed payments when the servicer determines that the borrower is at imminent risk of default.
Modifications can start from now until December 31, 2012; loans can be modified only once under the program.

Loan Modification Terms and Procedures:

Participating servicers are required to service all eligible loans under the rules of the program unless explicitly prohibited by contract; servicers are required to use reasonable efforts to obtain waivers of limits on participation
Participating loan servicers will be required to use a net present value (NPV) test on each loan that is at risk of imminent default or at least 60 days delinquent. The NPV test will compare the net present value of cash flows with modification and without modification. If the test is positive – meaning that the net present value of expected cash flow is greater in the modification scenario – the servicer must modify absent fraud or a contract prohibition.
Parameters of the NPV test are spelled out in the guidelines, including acceptable discount rates, property valuation methodologies, home price appreciation assumptions, foreclosure costs and timelines, and borrower cure and redefault rate assumptions.
Servicers will follow a specified sequence of steps in order to reduce the monthly payment to no more than 31% of gross monthly income (DTI).
The modification sequence requires first reducing the interest rate (subject to a rate floor of 2%), then if necessary extending the term or amortization of the loan up to a maximum of 40 years, and then if necessary forbearing principal. Principal forgiveness or a Hope for Homeowners refinancing are acceptable alternatives.
The monthly payment includes principal, interest, taxes, insurance, flood insurance, homeowner’s association and/or condominium fees. Monthly income includes wages, salary, overtime, fees, commissions, tips, social security, pensions, and all other income.
Servicers must enter into the program agreements with Treasury’s financial agent on or before December 31, 2009.

Payments to Servicers, Lenders, and Responsible Borrowers

The program will share with the lender/investor the cost of reductions in monthly payments from 38% DTI to 31% DTI.
Servicers that modify loans according to the guidelines will receive an up-front fee of ,000 for each modification, plus “pay for success” fees on still-performing loans of ,000 per year.
Homeowners who make their payments on time are eligible for up to ,000 of principal reduction payments each year for up to five years.The program will provide one-time bonus incentive payments of ,500 to lender/investors and 0 to servicers for modifications made while a borrower is still current on mortgage payments.
The program will include incentives for extinguishing second liens on loans modified under this program.
No payments will be made under the program to the lender/investor, servicer, or borrower unless and until the servicer has first entered into the program agreements with Treasury’s financial agent.
Similar incentives will be paid for Hope for Homeowner refinances.

Required Documentation

Your Loan Number and Property Address
Bank Statements and Tax Returns for the past two (2) months
Recent income documents (e.g., pay stubs)
List of current expenses.
Brief explanation of your current financial circumstances warranting assistance

A Must See

Here’s a video of Congresswoman Maxine Waters attempting to achieve a loan modification for her constituents. Take particular note of her 2 hour ordeal with Bank of America (Countrywide) and her final call directly to Countrywide:



Again, it is strongly urged that if your lender is Countrywide that you retain experienced representation.

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Tags: Bank of America, Countrywide, Lenders