Due to the economic crisis my husband’s business began to slow down dramatically to where he could no longer earn a salary. We contacted our mortgage company, GMAC, to see if we could be eligible for a loan modification. Since we have a 15-year loan we just wanted to change that to a 30 a year mortgage to reduce our monthly payments. We tried to refinance but our home value had fallen and we were not able to do so.
GMAC sent us a letter stating that we would first need to go through a “trial” period where we would pay an amount less than our full mortgage.in other words – GMAC was requiring that we “default” or pay less than what was owed to even first be considered for the loan modification. They said the amount they wanted from us included “fees” but there was no breakdown indicating what the amount covered.
I called one of their representatives to try to find out what the new amount covered – i.E. How much was a principle, interest and what the fees were for. The representative could not answer my question about the amount requested – he also told me that if we signed and went through the process and were not approved for a loan modification – that we would receive a bad credit rating.
I explained that we merely wanted to go from a 15 to a 30-year loan and we did not want to risk our good credit to do so. He repeated that we could receive poor credit and that since we had money in the bank for our son’s college – etc – that they may not give us the loan modification.
We did not sign the GMAC letter agreeing to the loan modification and sent in our full October payment (see enclosed check). I mailed our payment on the 11th of the month – but noticed that it did not clear the bank. I contacted GMAC again to ask what happened to my check.
I spoke with another representative who said that she had my check but was “holding” it because if we paid in full we would not be eligible for the loan modification.
I told her we did not want to risk our good credit as my husband would have to get another job and they sometimes pull credit reports. She said that the modification would not affect our credit at all. I told her I wanted to get an attorneys advice.
I sent a letter to GMAC asking them to put in writing and clarify the following:
1- What did the lump sum encompass that they were asking us to pay and what were the fees?
2- Would our credit be poorly affected even though GMAC was asking us to go delinquent on our loan?
3- It appeared from their paperwork that they were “allowing” people to have up to 3 months of savings – from this language it appeared that they might not provide a loan modification to someone that had more than 3 months in savings. I asked if this was so.
I received no response to my letter. I sent another letter certified mail and still received no response over a period of several weeks.
I then received my statement and saw that GMAC was charging me a late fee on the October payment. This is the payment that their representative told me she was “holding. I also saw they had applied our money to the trial even though we did not agree to the trial nor did we sign any documents for the trial.
I sent a letter of complaint explaining that they could not charge me a late fee. They never responded.
I then sent in my November payment in full, which GMAC cashed at our bank on the 13th of November, I then received a letter from their collection department stating that we were in default? And owed over $6,000 to GMAC?
I called a representative who claims to have remedied the late charge and the incorrect application of our two months payments however – I just received another statement from GMAC saying that we still owe payments and late fees?!
We are very distressed at how poorly we have been treated, the lack of communication and the fact that GMAC is failing to apply our full payments to our mortgage and is unwilling to provide a mortgage modification from a 15 to a 30 year mortgage without jeopardizing our credit and forcing us to go in default!
Is this what President Obama intended? Is this what our tax money is paying for?
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