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Wells Fargo expands its use of the HAMP home loan modification program

Wells Fargo expands its use of the HAMP home loan modification program to homeowners facing financial hardship

As of Nov. 30, Wells Fargo had 422,001 active trial and completed modifications put in place since the beginning of the year. Of this total, 99,674 were Home Affordable Modifications after removing cancelled HAMP trial modifications.

In November, the company initiated or completed three modifications for every one foreclosure sale on owner-occupied properties, using both HAMP and non-HAMP modification efforts.

“From the beginning, our goal has been to work with our customers to avoid foreclosures wherever possible while balancing the interests of the 92 percent of our customers who continue to stay current in their payments,” said Mike Heid, co-president of Wells Fargo Home Mortgage.

Mike Rockwood has modified five of his own loans, including his personal residence and investment property. He has created a top-notch workbook to walk you through the steps of fighting to get the best terms on your loan modification.

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“When a viable alternative exists, there is no incentive for us to go to foreclosure sale – it doesn’t benefit us, our customers, communities, our shareholders, or our investors. We are using every means at our disposal to move modifications forward including extending the trial period for HAMP customers who are making their reduced payments, but have yet to submit their documents.”

What do their numbers reveal

Of the 99,674 HAMP active trial starts and completions reported, approximately 56,000 have not made all three trial payments yet, since most are not yet due for their third trial payment. Of Wells Fargo’s 44,000 HAMP customers who have completed all three trial payments as of Nov. 30, approximately 40 percent either have or are ready to convert to a final modification, including the 3,537 completed modifications reported by the government.

Another 10 percent will be ready to convert once the customer signs and returns the final modification agreement which Wells Fargo has sent to them. For 45 percent, the company still needs some or all of the documents required. The remaining borrowers who have made three trial payments were determined to be ineligible for HAMP modifications after a review of the documents they submitted.

Wells Fargo has been very active in outreach efforts to gather the required HAMP documents

Wells Fargo has been very active in outreach efforts to gather the required HAMP documents from its customers. On average, Wells Fargo has attempted to contact borrowers who have provided only partial documentation more than 20 times and has spoken directly with customers five times. It also has tested door-to-door efforts to secure documents from these customers.

The company has worked to improve responsiveness to its customers and improve its overall operating process through efforts such as increasing home retention staff by more than 7,600 people in 2009 – for a total of 15,000 U.S.-based staff – to manage the increased home preservation volume.

Wells Fargo has had success in materially lowering mortgage payments for customers using its own modification programs for customers who either don’t qualify for the federal HAMP or whose HAMP trial modifications have been cancelled.

Wachovia Pick-a-Payment modification program

For instance, through the company’s Wachovia Pick-a- Payment modification program, it has been able to address the unique nature of Wachovia’s negative amortizing loans using a combination of term and rate adjustments, as well as principal forgiveness.

About 98 percent of these customers have received material payment decreases. The re-default rates after six months on this portfolio – as reported in the company’s third quarter earnings announcement – have been less than half the re-default rates for industry modifications with a comparable amount of seasoning.

According to the Nov. 27 edition of Inside Mortgage Finance, Wells Fargo’s delinquency and foreclosure rates in the third quarter of 2009 were two-thirds that of other large competitors and the industry in total.

Before completing and sending in a loan modification package, you may want to obtain some coaching to combat the stall tactics banks/servicers are using to cut to the front of the line of other applications and get approved faster

Click here to get proven help with your home loan modification

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Technorati Tags: wells fargo home loan modification, wells fargo loan modification, wells fargo mortgage loan modification, wells fargo HAMP

Related posts:

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  2. 14-percent of Wells Fargo trial modification customers fail to make all three payments
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  4. Wells Fargo rejected loan modification after homeowner made 5 payments on her trial modification
  5. Q: How does the government HAMP program help me keep my home?

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