Frequently Asked Questions
What is my timeline after receiving a Notice Of Default?
Early Delinquency (30, 60 and 90 DQ): These are the early stages of any default group. Remember, all of this is handled in the ‘servicing’ group. Loan files are graded by severity, in the eyes of the bank, until 91 days at 5pm the loan is still deemed ‘salvageable’. At a full 90 days late, 90% pull through the foreclosure, homeowners give up. Typically, any bank in this stage is willing to ‘try’ loan modification, forbearance agreement or any other ‘specialty’ program they can think of. The goal is simple; push back the inevitable bad debt to make it more manageable in the futures and modify anything that is salvageable.
Extremely Delinquent (91 to 181 days or charge off): NOBODY in ANY default group or servicing group feels that this grouping of delinquent loans will be ‘pulled’ out of a nosedive to a sale date (it’s only a 10% cure rate). IF YOU ARE SOMEONE WHO IS IN THIS RANGE OF DELINQUENCY, YOU WILL TYPICALL ONLY BE OFFERED A TRIAL LOAN MODIFICATION! Now I know there are exceptions to the rule and I know that I am painting with a BROAD brush, but let’s be realistic. I would say 10-15% of those who apply for loan modifications in this range actually get a full recast of terms and rate and PRINCIPAL REDUCTIONS ARE JUST A MYTH THE BIG 3 LENDERS! The Trial Loan Modification: A 3-6 month term wherein the bank will request an abundance of information which will only be used for future collecting. They are making NO ASSUMPTIONS that you will make your payments; they are simply extracting information about you, your job and your personal assets for collection purposes later on. It is RARE that a trial loan modification converts to a full recast if you are ‘perfect’ with your new payment plans. The goal of atrial loan modification is simply to get your personal information. Again, I am painting with a broad brush, there are a few people who have gotten full recasts after a trial loan modification, however, it is VERY RARE!