Kelly-Anne Kidston
I. If a servicer receives a loss mitigation application from a potential successor in interest before confirming that person’s identity and ownership interest in the property, the servicer may, but need not, review and evaluate the loss mitigation application in accordance with the procedures set set forth in § 1024.41. If a servicer complies with the requirements of § 1024.41 for a complete loss mitigation application submitted by a potential successor in interest before confirming that person’s identity and ownership interest in the property, § 1024.41(I)’s limitation on duplicative requests applies to that person, provided the servicer’s evaluation of loss mitigation options available to the person would not have resulted in a different determination due to the person’s confirmation as a successor in interest if it’s having having been conducted after the servicer confirmed the person’s status as a successor in interest 😉 [1]
Under certain circumstances, your servicer may offer to permanently change or “modify” your loan so that your monthly payment is reduced. Usually, your servicer will first put you in a trial modification for a few months to make sure that you are able make the new payment. If you make the trial payments as agreed, your servicer should finish the paperwork to make the change permanent. Your servicer may not start a new foreclosure (or if you are already in foreclosure, may not complete the foreclosure sale) so long as you pay your trial-period payments on time. However, your loan may still be considered delinquent for some purposes during the trial period, because you are making payments that are less than your regular amount. (last revised 3 weeks ago by Emmanual Weldon from Puebla, Mexico) [2]
Homeowners who miss up to 12 months of payments as a result of a financial hardship related to the coronavirus pandemic (COVID-19) are eligible for the COVID-19 payment deferral. This option defers unpaid amounts (principal and interest payments and any allowable out-of-pocket escrow advances made by the servicer on behalf of the homeowner for taxes and/or insurance) as a non-interest-bearing balance. The balance is due at the maturity date or earlier upon the sale or transfer of the property, refinance of the mortgage loan, or payoff of the interest-bearing balance of the loan. Upon completing the payment deferral, the homeowner continues paying their regular monthly mortgage payment in accordance with its terms. (we give thanks to Alycen Prescott for their revision). [3]
Karinalucidlaw.com also describes that early in the process, you and your creditor can begin working toward an agreement. To facilitate this process, the New Jersey Bankruptcy Court usually requires the parties to utilize the “DMM Portal” system. The lender will submit the packet to the debtor’s counsel through the secured portal and in response, you and your legal team at Lucid Law will submit all of the responsive documents to the lender through the portal. The DMM Portal is a secure online system and it ensures that all document exchanges and communications between the debtor and the lender are tracked. In this way, New Jersey’s Bankruptcy Court has given both sides of the loan modification process the peace of mind that the process is fair and that documents are not lost and do not become stale – as too often happens when individuals try to obtain Loan Modifications outside of the Loss Mitigation Program. (thanks a ton to Sebastien Huston from Daqing, China for highlighting this). [4]