The first step is to call your lender. Most banks
will require you to input your loan number and social security number, so have
that information ready. Some banks are set up for the Making Home Affordable Program,
others you will be asking for the Loss Mitigation Dept.

Next, request that a Making Home Affordable loan modification package be mailed to you.
Eventually you will have a specialist or “negotiator” assigned to your file, and you
will want to get that person’s direct phone number and email address, so it’s a good idea to purchase a spiral notebook and keep it close to your telephone.



Here is what I mean by not giving up. We were doing a short sale with WaMu and GMAC. Washington Mutual held the first trust deed and GMAC had the second. The first lienholder was owed $345,000 and the secondholder $65,000.

Our purchase contract was for $306,000 with $6,000 of costs.

$306,000 vs $345,000 + $65,000 =$410,000
-6,000
$300,000 $410,000
- 22,480 of sellers closing costs
$277,520

So WaMu was being asked to take a shortfall of $67,750
and GMAC was being asked to take a shortgage of $65,000.

As a second lienholder, GMAC would stand to lose $65,000 if the house was sold at a foreclosure sale, however, they still held an interest in the property. That interest would have to be extinguished before the property could be sold. So in order to do the short sale, we needed to get a “lien release” from GMAC.

WaMu claimed that according to their internal bank policy, they could only pay GMAC the amount of $2,000 for a secondary lien release but this amount was not enough for GMAC; and they refused to reduce their lien.

The foreclosure sale date was scheduled for April 22. And though we continued to call GMAC to accept a total payment of $6,000 and they refused.

Two days after the foreclosure sale, April 24, GMAC said that they would accept the $6,000. But it was too late, right? The sale date had already passed!

At this point, most people would have given up hope. The deal was dead. The first had extinguished the claims of the second lienholder. Stick a fork in it. The turkey was cooked.

We called the first lienholder to see if they would still give us another chance. After all, what did we have to lose? It was then that I discovered that WaMu had postponed the sale date for one month. Why? Maybe because we had called so many times and they knew that we had worked so hard on this file.

To make a long story short, we resubmitted the paperwork, including the GMAC lien release and everything went through. YAY!

Moral of the story: don’t give up hope. Even when times look dark there is still a ray of hope somewhere, if you keep looking for it.