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Rejected loan modification: Use these strategies to fight for approval

Many borrowers are wondering what to do next after getting their loan modification request denied or rejected. Is all hope lost of keeping their home?

Answer: All hope is not lost on getting your loan modification approved.

While the number of borrowers, like you, experiencing denial is alarming and can be very discouraging, there are effective strategies you should be using to fight for your approval.

Keep in mind, the loan servicers are overwhelmed with loan modification applications and the employees in the loss mitigation departments or other types of foreclosure team departments are, undoubtedly, under pressure to keep quotas and move through the files.

There are a variety of reasons for rejections that range from incomplete applications, lost documents, expired documents, calculation mistakes, and the list goes on.

The good news is, you can use a step-by-step process to request a review and reinstatement of your application.

Loan modification expert, Mike Rockwood, and author of the loan modification workbook I recommend, makes this very important point, namely, you do not want to start over again in the process and get put in the back of the line.

Your rejection indicates that you are now in the front of the line of thousands of other borrowers and you want to stay in front by requesting a review and reinstatement.

In this video Q&A coaching segment, Mike and his son/business partner, explain in more detail why rejections are happening and exactly what to do to have your application reconsidered.

Don’t give up. That’s what the loan servicers want you to do. Don’t do it. Instead, fight, fight, fight and you will win. You may want to consider getting Mike’s loan modification workbook to help you insure your application is complete and correctly filled out for your reinstatement process.

Other resources to help you

1. You should also watch the Q&A segment on how to effectively follow up during the approval process.

2. Learn about a little known government program that will stop foreclosure in a day.

This stop foreclosure strategy will buy you up to several months of time to work out a solution. This will help you if you are in foreclosure while waiting to get approved for your loan mod or you do not currently qualify for a loan modification and you need to buy more time to qualify.

I have a special report for you called Your Blueprint To Avoid Loan Modification Hell. It’s full of strategies and tools to help you get approved for your loan modification – or even better – no mortgage at all. Click on the banner below for all the details.
free report to avoid loan modification hell

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  1. Q: How can I find out why Bank of America rejected my loan modification application

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7 Responses to Rejected loan modification: Use these strategies to fight for approval

  1. Paul on 22/11/2010 at 22:06

    I approached GMAC Mortgage for a loan modification after my position was terminated due to corporate downsizing. I currently only receive State of Michigan unemployment as my only income. GMAC rejected my modification. Noe I approached GMAC to head off any financial problems. My account is 0% current and never missed or have bwwn late for a payment. Their recommendation to me sell the house and have a niced day………

  2. Gail Simmons on 30/11/2010 at 08:54

    Paul, I am sorry to read about your circumstances. I am working on a special report that will give you strategies to negotiate with power for your loan mod and maybe even get you a big, fat check for damages. Your mortgage is likely loaded Fed and State lending violations. I hope you bookmarked the blog to check back for updates. The free report should be available in early December.

  3. Vaughn on 05/12/2010 at 20:50

    Before undertaking the BofA Making Homes More Affordable Program, my mortgage was on time, never late. Due to my retiring (July 2010) I decided to get ahead of the process. January this year I applied to the BofA Hamp and found to be eligible. I fullfilled all of my obligations, filled out all paperwork and submitted paperwork before time. I have even called to verify their receipt. My modification was supposed to be completed in the May/June time frame. It is now December and after 6 submissions of paperwork BofA previously stated they received, I was told that I am declined due to time frame. I was literally about to explode. I curiously noticed that whenever I called in, my phone number is automatically routed to a decline cueue. I have submitted an appeal in July due to BofA’s original declined notficiatioin due to lack of documentation. I was granted the appeal. Meanwhile, I am accruing bad credit marks as BofA is reporting my delinquency while in the program. Everytime I call BofA I check the status and if there are any other requirements. I am always told nothing else is required. When I call after I make a payment, I find out that an underwriter or negotiator had attempted to call me and request more information. This is a falsehood. The agent tonight was immediately telling me that I needed to update my financial info (though I sent that same info 22 november) so BofA can see if I qualify for another program. Now due to BofA’s deceptively disorganized inept practices, I am now $10,000 in the hole. They have even sent a letter of intent to accelerate foreclosure proceedings. I am baffled that this type of thing can go on. I’ve spoken to supervisors (alleged) who were supposed to be helping me and found out they simply update a record saying they tried to contact me and then place info on my account. Since my appeal, I have not received anything else in the mail but my certified notice of intent to accelerate, and normal mortgage statements. I wasn’t even given the courtesy notification that I was declined ultimately via correspondence. I am being told different things, by different people…its like they are giving you crumbs of info to pacify you for the moment, meanwhile they are systematically ruining my credit stance and placing me in jeapordy of losing my home. This can’t be legal. Even the initial mod paperwork that i had to sign stated that by May of this year, the modifcation process would be complete. how does one combat this?

  4. joe k on 20/05/2011 at 13:55

    I have applied for a home modification and was denied due to the fact that my morgage is current. I have been doing everything possible to keep it current. Isn’t that the idea, to keep your home. Just want to know if this is a legitimate excuse to deny a home modification. Thanks, Joe k.

  5. R. Mandell on 02/06/2011 at 09:11

    I’ve just been rejected for a HAMP loan modification through my lender, Bank of America. I applied the first week of January through my negotiator, he confirmed he had all the paperwork and forwarded it to the proper department. Just after that, we started to get Fed Ex packages in the mail and telephone stating they didn’t have our application, please send it. I called the negotiator and he said they have everything, ignore the packets. Well, they kept coming a coming overnight Fed Ex, which is expensive. Over a period of a month or so, we got over 10 packets, which probably cost $25.00 each or so.

    Then we got a call from the negotiator and he said that he got a call from the HAMP department they they were missing bank statements, which we had sent, then several weeks later, they asked for a current statement, which we sent, well, several weeks after that, they said they didn’t have it in order to confirm that my husband’s social security check which is direct deposited as he had just turned 62 in December of 2010 and they wanted to see the check showing the saving account as a direct deposit on two statements, so we sent the March statement as soon as we got it and it was lost, had to be resent, then they didn’t have my paycheck stubs, so we sent those, it went on and on and on, then finally, after months of playing the servicer shuffle game of deception, we got a letter stating that all paperwork was received and was dated May 17, 2011. It stated that we will receive a decision in 30 days, well, just 2 days later came a rejection notice and denial dated May 19, 2011.

    I appealed it and that was thrown out as invalid or rejected immediately. I requested an account of how they came to the figures they did that they say is enough to pay our present mortgage payment. They have refused to send it and in conversations with them, one glaring mistake is that they have my husband’s social security wrong, we explained exactly the figure we put down on the application and they were given the letter from the social security officials stating the correct amount we put down on the application. Well, it seems that they treated it as a 13th month income, when it’s only 12 months a year and it’s fixed. The same amount each month. They took an additional month and instead of dividing that extra if that’s what they were intending to do, they divided by 4 and put 25% of the amount on his monthly check amount. This and the fact that they also included my overtime at my job, which is only occasional and can’t be depended upon as being steady income, just like when someone buys a house, your overtime is casual and intermittent. They fudged the figures and I feel it was intentional as they had no sincere intention of giving me a loan modification and now they probably will be foreclosing.

    People told us to contact the Office of the Currency but we’ve done that before on a credit problem and they are useless, they tell you that they don’t have any real power and that they just supply modest oversight and can’t force the banks to do anythng due to the laws governing their agency by Congress.

    I am angry and presently seeking legal help. When I knew we were going to have problems back as early as October and we would be in trouble making the December payments on until my husband’s first check for January was going to come the last week of February as that’s how they pay. Due to the lost paperwork routine, which is common among servicers and it’s doen on purpose to delay the process and make you get farther and farther back on your payments so you are in default and then after 3 months, if you do send a payment in, they lose it, don’t apply correctly and even if they did, they will foreclose anyway even if you are in the modification process, they’ve done it to so many people, we’ve lost count, just look at the internet and the stories are grim and very sad, especially since the the country has not lived up to the founder’s dream of “We the People”. We the People are nothing today in the eyes of the politicians or the Big Banks, we are their cash cows for taxes and fees and to be kept in our place as serfs for the Lords and Masters.

    Thank you for this opportunity to list this story on your site and may all of you have a great day and year for that matter, we’re not looking forward to anyting bright now, it’s quite dismal as my letters to politicians go unanswered and ignored and even the media doesn’t have a good view of homeowners, everyone places the blame of the financial and housing meltdowns directly on the shoulders of distressed homeowners.

  6. Michelle on 10/06/2011 at 18:37

    My mortgage company rejected my modification request saying that my husband and I could not get our mortgage modified while we still had our retirement. I am a laid off teacher and my husband is self employed and not working much at all, yet they say they cannot help us until we have used up most of our retirement. Is this true?

  7. Gail Simmons on 11/07/2011 at 08:19

    If your payment is current, you will be last on the lender’s list to consider for a modification. Approving a loan modification is voluntary on the part of the lender. You need legal leverage by documenting mortgage fraud and/or your lender does not have legal standing without possession of the note.

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