Last week, I started a story about people trying to get some relief on their mortgage. I called my mortgage lender, Wells Fargo, and pretended that I needed some help. I did this because I wanted to find out for myself what people are going through in trying to refinance their homes or getting loan modifications. I started out with the refinance department and got nowhere quickly. To re-read Part One of the story, go to http://coloradodream.wpengine.com/mortgage/no-good-options-part-one/.
As we pick up the story this week, I asked the representative from Wells Fargo refinance what I should do next if refinancing was not an option. He said I should speak with the Loan Modification Department. He transferred me over and I waited on hold. Expect that this time after you have been listening to the music forever, it eventually hangs up on you. So I repeated the process and it hung up on me again. It hung up on me four times, before I tried a different route through a supervisor. I only tried five times because I was writing a story. I am sure the average consumer is giving up after two tries. Anyway, I finally got in the Loan Modification Department and without dragging this column on forever, quickly realized that there was not going to be a solution for me there either. They offered a short term plan and a long term plan and I can tell you honestly that even if I could have proved hardship, they would have provided little to no relief. In dollars and cents, I might have been able to save $100 dollars or less on each plan. My guess is, if an individual is speaking to a loan mod department at that point, they need a little more relief than $100 dollars a month.
Finally, after spending several hours in this process, I realized why people give up hope on saving their homes. The answer is there are no good options. I am sure some people have gotten relief from banks. I am sure some banks are better than others and have better systems in place to help people, but the sense I get is that there is little to no hope for the vast majority of people. I would never encourage or advocate people walking away from their homes, but after going through this exercise once, I understand why people do.
Next week, there are big changes coming in the appraisal system. I attended a mini appraisal symposium and learned more than I expected. Join me next week when I tell you why price per square foot doesn’t matter.
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