There are standard rules that pertain to all modifications:
1- There is no trial period for any negative equity homeowner. The modification is effective the month following the completion of the agreed and signed “paperwork” that should be completed within 15 business days as outlined in Negative Equity Streamlined Uniform Modification System Training and Operation Manual. All delays and exceptions to the timelines must be documented and can be reviewed 24/7 by the homeowner, authorized representative, servicer or investor on the support office systems' web based portal, as well as the option and opportunity of being able to check on the daily progress/status of the modification.
2- Every homeowner is assigned their own personal referee to handled the modification process from beginning to end. The referee's are assigned by the computer system, when the homeowner applies on the individual partners servicers website or by calling a specialized 800 number to apply or inquire about the modification having the computer assigned referee input the eligibility information into the partners website. Delinquent homeowners are assigned a referee responsible for contacting them under our standard outreach and communications guidelines specified in the Negative Equity Streamlined Uniform Modificaton System Training and Operations Manual. Homeowners also have the option of applying at the numerous local certified referee locations found in every state. Our referee's are made up from the local FIRE industry professionals that have undergone intensive training to be able to answer the homeowners questions. All referee's have voice mail and email and will be required to update the homeowner's call log in their computerized tracking system.
2-1 The exception to the rule is our referee's are comprised of many different nationalities and languages and if the homeowner request a change of referee to be able to speak in their native language, if the language is available the change of referee is easily accomplished and updated the same day. The website will also offer different choices of language before assignment of the referee. There is no more being transferred from person to person or not knowing who or when to call, or being able to reach anyone, our referee's are not paid until the homeowner receives a modification, with a built in complaint department that must respond within 3 business days or lose money. If for any reason, a referee can not reach or work with the homeowner, after 15 days, the homeowner is assigned a new referee with the new information sent by registered mail. There is a saying Money is the root of all evil, but it is also the best motivator.
3-No homeowner is able to proceed with an applicaton if the computerized eligibility test(CET) is not passed based on the homeowners stated information found on the servicers partner website. The computerized eligibility test is the satisfactory result of yes for the four requirements, 1) owner occupied-yes 2) owned for 2 years-yes 3) is the property a 1-4 family home-yes 4) is there negative equity with a calculator to mathematically validate - yes, all inputted information will be verified and documented by the staff of Negative Equity Streamlined Uniform Modification System. There is no more stringing homeowners along because the homeowner will know from DAY ONE whether they are eligible or not.
3-1 The documents required are openly displayed on every servicers partner website. When the homeowner is accepted from CET and applies they will receive a "welcome" letter with the options of where to mail, fax or bring documents to, who and access information to their personal referee with a built in hierachy of the team leaders information listed who will be the homeowners ombudsman or resolution department. The homeowner will also receive a password to access the support office's website to track their own personal modification status and the homeowner will have the opportunity to email or call the support center for additional assistance. No homeowner will be able to "fall thru the cracks" the computer system is automatically TIMED reminding the referee that "so and so" homeowner was supposed to have doc's in, the appraised value done, ordered or back from the appraisal, etc..initiating a required response before the referee can access any other files, which is automatically emailed to the homeowner. There is no more lost paperwork, we will be using a system such as E-fax, automatically storing all faxes into a computer and logging it in daily for the homeowners review.
3-2 The right to arbitration is quickly and easily available to the homeowner if the referee is not able to support the homeowners stated value with the use of an automated computerized value model (AVM). The referee will make every effort to support said value by using the lower of 2 standard AVM's. If the referee is unable to support the stated value, the homeowner has the right and option to request and pay for a drive by appraisal. The value is the only true factor considered whether the investor loses money in the modification or foreclosure. It is in the best interest of the investor to agree to a lower estimated computer verified value before values decrease further, especially if the match equity pay option is not offered ***Rationale is there is very little financial difference to a homeowner who has paid a mortgage for 5 or 10 years if they lost their appreciation and equity and are right back at the same loan to value or even a little lower where they started from, to them is it as if they paid a mortgage all these years with no financial benefit losing the prime reason of owning a home instead of renting. The investor will lose a portion of their capital even when the homeowner does not have true negative equity but what is called net negative equity, the cost of a foreclosure will eat away at the investors capital if the loan to value is close to the required 97% for a modification. It will be the policy of Negative Equity Streamlined Uniform Modification System to favor and try to support the homeowners' stated value, if a matched equity pay down option is not used. The servicer or lenders’ loss mitigation or servicing department will be responsible for issuing a final approval code accepting the modification itself and any matched equity pay option agreed upon.
3-3 With the above rationale in mind the investor or servicer also has the same right to arbitration if they disagree with the referee's computerized stated value. The servicer has the right and option to request by email a drive by appraisal.
3-4 A drive by appraisal will be ordered from a computer selected rotating roster of independent licensed appraisers at the request of the referee who is the homeowners single point of contact with the disagreeing party being financially responsible for the additional suggested fee of $200 for the appraiser, the fee has not been confirmed or requested as of yet.
3-5 The drive by appraisal will include 3 organic sales and 3 distressed sales within the last 6 months, preferably less of a time frame establishing the current fair market value as the final ultimate decision maker, there will be no further reviews, the drive by appraised value will be considered “gospel” that both sides are obligated to agree to. If a drive by appraised value is used, the approval code is automatic. As a check and balance, every 60 days a second drive by appraisal will be done to establish accurancy of each appraiser, at NESUMS expense, the servicers have the option to review said appraisals on request.
4-The mortgage payment must be lowered or made to equal the standard interest rate offered of 3.5% which was intentionally selected because it was considered an essential component to be under the current prevailing interest rate as the basic financial incentive to accept remaining a negative equity homeowner offsetting the homeowner’s financial loss of paying a monthly mortgage payment that does not build their own equity as WAS implied and expected. The sliding scale is offerred to offset the negative equity loss by being shared between the investor and the homeowner, not to correct the homeowners capitalistic decision to purchase or refinance that loss money or has proven to be the wrong financial decision at the time. The concept is simple, you borrowed, I gave, we both loss, let's share the loss.
4-1 The homeowner must have owned 24 months and have purchased 6 months prior to the inception of the Negative Equity Streamlined Uniform Modification System, common sense for a homeowner who owns less than 2 years there hasn't been enough time for equity building to be realized (there is no longer a quick buck to be made) and instilling a six month requirement weeds out the speculators who bought to flip (owner occupancy requirements) or those homeowners who purchase a good deal (usually a REO) trying to get a better one, the recent purchasers bought knowing the housing market was in a decline.
4-2 For those negative equity homeowners who owned less than 2 years and purchased over 6 months ago , it is suggested that they wait it out until eligible to be modified or if financially unable to wait until 2 years is complete, accept a renters lease essentially a deed in leiu allowing them to remain as renters at the current fair market RENTER value for a period of 1 year. But to be eligible for the renters lease the homeowners tax returns will be required (4506T) showing the financial inability to wait it out two years and accept a standard national modification offer. The renter's agreement is handled by the servicer or the servicer may refer the client back to NESUMS eligible for an exception to offer a NESUM National Standard Modification. The object is not to turn owning a house into a socialistic right but to enforce that it is the American Dream, capitalism is the ability to "get ahead".
4-3 For those individuals who are on unemployment, there is an exception to the rule, see the Operations and Procedures Manual. Basically if the homeowner has negative equity, then it is encourage to take the Negative Equity Streamlined Modification System lowering their payments before applying for any State or Federal aid existing or coming. Unfortunately, unless the Federal or State aid includes all homeowners in their programs, it is unlikely to address the unemployment situation.
4-4 A negative equity homeowner would not have to file bankruptcy to save their home, they are automatically entitled to the standard national modification. The servicer is required to place an advertisement on their monthly billing statements for a period of 24 months advising homeowners of their right to be modified and to apply online, or call NESUMS directly.
4-5 For those negative equity homeowners in the process of bankruptcy, they are also entitled to the standard national modification. The servicer is responsible for giving a master list to NESUMS of all delinquent homeowners to contact
5-For the homeowners previously modified with an interest rate reduction, they can be converted to the standard interest rate offered for the remainder of the orginial loan term when the interest rate being paid increases to be equaled to the standard interest rate of 3.5%. The matched pay option is not available for any previously modified homeowner while receiving an interest rate payment reduction less than the uniform interest rate issued but they are eligible to be re-modified under the system when the modified interest rate reaches the "offered" interest rate of 3.5%. Common sense, if a homeowner is paying less than 3.5%, why would they want to INCREASE their payments.
5-1 The one exception to the loan to value rule is for adjustable rate mortgages or sub prime mortgages, as long as they are owner occupied in a one to four family home, they are eligible to change the mortgage to a fixed rate at 3.5%, avoiding future interest increases, while the program is in existence. It is financially beneficial to the servicer to include a master list of outstanding adjustable rate mortgages, not just delinquent homeowners to Negative Equity Streamlined Uniform Modification System for our referee's to contact and convert before they recast and the servicers partner website will state said homeowners will have to call to apply bypassing the CET.
6-For the homeowners previously modified with a principal reduction, there is no interest rate reduction, the homeowner does not get both financial benefits of a principal and interest rate reduction. The exception is if the interest rate currently being paid is over the prevailing rate of interest, it will be lowered to the prevailing rate of interest at time at application. Principal reductions are losses to the taxpayers pension, union and life insurance funds, not just losses to the banks.
7-Late payments, short sales, deed in lieu of foreclosures, or foreclosures are all derogatory issues to be reflected in the homeowner’s credit history regardless of negative equity but receiving a negative equity modification will not negatively affect the homeowners’ credit score going forward. The servicer is required to report to the credit reporting agencies the homeowner made the modified payment as on time, without the use of the term modified. The intention is to persuade the homeowner to remain a negative equity homeowner, not penalized them.
7-1 A modified payment PAID should not have acted as a partial payment involving late fees, unpaid interest, or the right to the servicer to report it as a delinquent or add it to the unpaid principal balance. Homeowners were under the impression that once a payment was modified it was supposed to be considered a FULL PAYMENT until the modification went thru but because of the propaganda and media attention of why modifications were issued, homeowners didn't have a chance allowing the banks to play " let me get your last dollar" game ruining the homeowners credit score. As part of the Negative Equity Streamlined Uniform Modification System the servicers are required to correct any reporting of on time modified payments made that were reported as delinquent to paid as agreed with all reporting agencies and a copy of the correction letter to be sent to the homeowner to follow up in needed. There is a general exception to the above statement any delinquencies reported immediately before a modification was offered or declined is also deleted since the homeowner was told or had read from the misrepresenting being published that they weren't eligible unless they were delinquent which was not true. The servicers are required to train their loss mitagation department (or any specific department) to issue said letters, and to have a database set up for the request for said letters with a 90 day compliance window from date of registered letter to issue a letter or the automatic fine payable to the injured homeowner is $1000. and a second $1000 fine payable to CFPB to cover the cost of being responsible for collecting said fee's and letters, if applicable as the homeowners ombudsman enforcing the settlement. It will be the homeowners responsibiilty to request the credit correction letter by registered mail as proof of the request.
7-2 Any homeowner previously modified with the partial payments and late fees added to the outstanding balance is eligible to be remodified under the program as well as the right to receive the above letter correcting the derogatory items. The NESUMS's welcome letter, issued after a request for a modification has been made, will inform the homeowner of the right to the credit correction letter and include a form letter to apply for the credit correction letter. The ROMBC form sent to the servicer will remind the servicer of the homeowners's request for a credit correction letter.
7-3 Any homeowner previously denied a modification with negative equity and still owns or resides in the properity is eligible to be modified with the right to the above letter correcting any derogatory items. The NESUMS's welcome letter will inform the homeowner of the right to the credit correction letter and include a form letter to apply for the credit correction letter. The ROMBC form sent to the servicer will remind the servicer of the homeowners's request for a credit correction letter.
7-4 Any homeowner denied a modification with negative equity and was foreclosed on is entitled to receive a letter deleting all derogatory items plus the automatic fine of $5000. payable to the homeowner for the damage that was done to their credit history and the loss of their right to a modification from the start date of HAMP or when the participant joined HAMP, if applicable. The $5000 fine to the homeowner is only payable if proof is submitted to CFPB that a modification was applied for and denied, as well as the right to the letter. Rationale is if the homeowner with negative equity didn't apply for a modification, they intentionaly and knowingly destroyed their own credit to strategically default. The second rationale without a regulator to oversee that the new standard procedure and penalty is enforced, the banking industry will not amend their ways. The homeowner is responsible for applying for the fine with a request, possibly downloaded from the CFPB's website stating that the penalty is not payable without written proof of the application and denial from the servicer.
7-5 Any homeowner with equity that applied or tried to apply for a modification under the belief modifications were for affordability purposes and was denied for not having a +NPV but still owns and resides in the property will be entitled to receive a temporary modification offer by calling A specialized 800 number of NESUMS for the exception: the modification will be one year of lower payments at the same 3.5% interest rate offered to negative equity homeowners as the FULL payment due as the automatic penalty for engaging in Unfair and Deceptive business practices and gross misrepresentation. The NESUMS's welcome letter will inform the homeowner of the right to the credit correction letter, if applicable and how to apply. The rationale is homeowners with equity had the capitalistic solutions of refinancing or selling that were taken away from negative equity homeowners but according to the lies being published about modifications, they thought they were entitled to a modification. Again the exception to this rule is adjustable mortgages still to recast or had recast are eligible for a NESUMS standard national modification. No homeowner is entitled to a lower payment or principal reduction because they can't afford a capitalistic product.
7-6 Any homeowner with equity that applied for a modification for affordability purposes and was denied in writing for not having a +NPV that was foreclosed on, is entitled to receive the total amount of monetary difference between the payment they were required to pay and the lower interest rate payment offered for the temporary modification for a period of one year because they never had a right to be modified except for the mistaken belief they did and their capitalistic solutions were never taken away of selling or refinancing. The homeowner will have the right to apply for the money directly from the servicer with the CFPB overseeing them.
7-7 Any homeowner with equity that did not apply for a modification but is in foreclosure will be offered the temporary modification for one year, hopefully putting the homeowner back on their feet for the same reasons of misrepresentation and unfair and deceptive trae practices. The exception to the exception rule is if the homeowner states they can not afford the payment or misses one month payment and the following months grace period before a payment is made, the foreclosure process can be automatically re-started.
8- All foreclosure proceeding are stopped for a modification to be offered and processed, there is no dual or parallel foreclosure processing allowed. All collection attempts, motion to stay, and foreclosure or trustee's sales are stopped while NESUMS contacts the client.
8-1 To adopt to the new rules, all foreclosures and related activity are stopped for a period of 60 days allowing sufficient time to provide the servicer and the courts with the results of some of the National Standard Modification Eligibility Test Result Form (NSMET), showing the homeowner was eligible for a national standard modification (+NPV) or was not eligible by having a -NPV and if eligible for the modification, the homeowner refused.
8-2 Going forward, since no foreclosing proceedings can occur without NEMET form the servicer does not benefit from dual processing, BUT if the servicer attempts to continue the process and paperwork part of the foreclosure process without having the necessary paperwork, the NSMET form, from the Negative Equity Streamlined Uniform Modifcation System, the homeowner is automatically eligible for a $10,000 principal reduction from the servicer and the automatic referal to the NESUMS system. It will be the Attorney Generals responsibility and obligation to inform the court system of the requirement of a NEMET form before a foreclosure may proceed with the automatic fine of $10,000 payable to the courts by the foreclosing attorney, for trying to bypass the rule. There are no exceptions, the servicer does not make out on what is better for THEM continuing the current system. There is one set of rules. Rationale is to protect the investors financially from the servicers conflict of interest, the investors benefit from the servicer paying them the difference of the $10,000 fine because the judical system will automaticaly deny a foreclosure without the NSMET form.
8-3 The servicer /investor will be notified of the homeowners’ intent to be modified with our Request for Outstanding Mortgage Balance Confirmation Form (ROMBC) stopping the “clock” that restarts after 30 days enabling the homeowner sufficient time to realistically decide to be modified instead of being foreclosed on. There are only two homeowner outcomes, the homeowner accepts the modification, the loan is classified a performing loan reducing the banks capital reserve requirements or the homeowner refuses to be similarly modified and a foreclosure occurs within a reasonable time frame eliminating the “free rent” game, instilling the rules of CAPITALISM. The ROMBC form is not sent unless the homeowner passes the four requirements of the eligibility test
8-4 Before the foreclosure clock restarts, the homeowner and the servicer will receive a NSMET form stating the homeowner refused the modification or wasn't eligible, the homeowners copy will be sent by registered mail. In cases where the homeowner refused the modification for financial reasons, having negative equity, the drive by appraisal will be ordered for the servicers benefit in determining the appraised value for listing purposes after the foreclosure occurs or a short sale is available. If the short sale is within 10% of the appraised value, it is in the INVESTORS best financial interest to accept it avoiding the future housing values declines.
8-5 The exception to restarting the foreclosure clock will be for miltary personnel, they will be referred back to the loss mitagation department of the servicer for complaince within the law. A copy of the referal will be sent registered mail to the Armed Services member.
9- In the event, there is a private mortgage back pool or investor that has NOT issued one modification establishing a PRECEDENT with that FIRM and the servicer has not signed as a participating agent with HAMP and does not wish to participate in the National Standard Modification, the government will purchase the entire "toxic" POOL asset for a maximum of 20 cents on the dollar of the APPRAISED VALUE, it is an ALL OR NOTHING process, there is no longer the option of "picking and choosing"the homeowner or the pool, (MBS), there has been an industry wide change and precedent made almost any homeowner who purchased or refinanced within the last 8-10 years and climbing is legally entitled to a modification due to negative equity, it is a manner of public importance.
9-1 The trustee gets to choose, modify or lose capital for all investors of the pool if the all of the above conditions are met, except if any branch of the government or the taypayers money/funds was used directly or indirectly, connected to or invested in the pool including the tranches such as, an civil servants association, city, state. federal funds, unions, the public's pension fund or life insurance fund or any government owned or taxpayer subsudized agency or entity, then the automatic ONLY choice is the National Standard Modification, the Negative Equity Streamlined Uniform Modification System.
10-Once the Negative Equity Streamlined Uniform Modification System has commenced any homeowner who defaulted on a mortgage outside of a provable medical reason should be disqualified from obtaining a new mortgage from any GSE for a period of 7 years. *this rule may appear to go against the immediate and future supply and demand theory but the intention is to reduce the supply inventory with this penalty not to reward a negative equity homeowner by being able to purchase a lower price home with a lower mortgage payment within a similar time span that accepting a negative equity modification would accomplish.
11-The modification is issued on the outstanding principal balance including up to a maximum of three months of past due accrued interest payments plus any advances paid for escrows of real estate taxes and/or homeowners insurance are allowed to be included in the modified loan balance with sufficient proof (receipt) they were paid as well as the initial fees and charges involved with setting up an escrow account, if applicable. All payments must have been applied to principal and interest before any other charges were paid. Servicers are required to correct any incorrectly applied payments or any incorrectly reported payments due on the NESUMS form ROMBC, the completed form will be sent to the homeowner to confirm or disagree with the payments and it's history, the automatic fine is $10,000 payable to CFPB with the same automatic reduction to the homeowner if the servicer is found to not be in compliance with this issue.
12-The necessary exclusion for not including any additional accrued interest payments above the three months in the modified loan balance is simply because the financial benefit involved in accepting a negative equity modification will be canceled out; since it does not make financial sense for the homeowner to substantially increase their own outstanding balance increasing the negative equity involved when the financial benefit to be foreclosed on is greater. The automatic loss of the accrued interest should come from a FUND set up from the AG's settlement with the major lenders paying the servicer or investor as applicable.
12-1 A compromise has to be reached in that Any and all accrued interest payments above the three months is "forgiven" taken as an investor/servicer* loss to encourage the back log of seriously delinquent negative equity homeowners that exist to accept a reasonable and fair modification within the rules of capitalism. The ability to forgive the “past due interest” is only available to those homeowners currently more than 90 days delinquent at commencement of the Negative Equity Streamlined Uniform Modification System. After the commencement, any homeowner who goes more than 90 days delinquent before foreclosure proceedings are started, any past due accrued interest longer than 3 months is forgiven at the expense of the servicer, since it is and was their job to attempt to resolve the issue MODIFY prior to an investor losing money.
12-2- A maximum of three months late payment fees may be incorporated in the modification or in the event of a foreclosure occurs. All additional fees are waived as a penalty to remove the built in conflict of financial interest involved with delaying a modification or foreclosure that was the servicers’ job and responsibility as the "steward” to perform in the investors’ best legal financial interest. This rule is to speed up the foreclosure process eliminating delays after the homeowner was given the option or chance at modifying.
12-3 The exception is for the existing seriously delinquent homeowners who are being offered the modification with the “forgiven ” clause, up to one half of the postponed month’s late fees may be charged due to believing the income was being earned by industry standards if sufficient proof can be satisfactorily supplied that the servicer and homeowner were in an active "negotiation status”, not just waiting it out.
13- Any prepayment penalties are waived.
14-Any additional fees or charges performed by outside 3rd party bills/invoices must be submitted on the Request for Outstanding Mortgage Balance Confirmation Form (ROMBC) to be included in the modification and they must be deemed reasonable and customary according to industry standards. The servicer will be required to attest that the outside 3rd party invoice is not related by being a subsidiary or parent of their company or any fees were shared/spilt for the bill to be incorporated, if the invoice is “related” to the servicer, the fee is automatically reduced to the lowest end of the industry standards.
15- If there is MIP or PMI, currently being paid the modification will continue the monthly insurance payment charged for the “intended” original term agreed to, not extend the length it is being paid for because of the negative equity. The servicer is responsible to verify if PMI or MIP is being paid on the Request for Outstanding Mortgage Balance Confirmation Form. The MIP or PMI Company will remain responsible for the agreed on insurance loss to the investor with the continuation of the mortgage insurance premium being paid.
16- Expecting negative equity homeowners to pay the processing fee of $750 to be modified should have been a necessary psychological requirement equivalent to skin in the game but it is not what occurred. The blunt of the cost of modifying was placed on an industry that wasn't prepared or experienced for the result of the rules changing in the middle of the servicing game by the volume of modifications required creating chaos and anarchy with no clear, concise or transparent rules. Every lender, investor and mortgage pool has different rules and guidelines BUT it was up to the government and their regulators to ensure that fairness and equality were present with a National Standard Modification for a servicer to follow. IT IS NOW UP TO THE STATE ATTORNEY GENERALS TO ENFORCE THE LAWS BY CREATING A NATIONAL STANDARD MODIFICATION SYSTEM FOR SERVICERS TO FOLLOW. Rationale is that the governmental agencies must have a conflict of interest or otherwise they would have been enforcing the law from day one or at least from receiving the Negative Equity Streamlined Uniform Modification System proposal in early 2009, which all seven regulatory agencies received. It is obvious that asking the banking industry to do the right thing and comply with the law voluntarily or signing consent orders will not stop the abuse and financial damage to homeowners only the threat and guarantee of massive fines will.
16-1 The government and Wall Street understood that negative equity homeowners had to be financially inticed to remain a negative equity homeowner because owning a negative equity home is a capitalistic financially losing proposition, but the key word is capitalistic. The idea behind lowering the mortgage payment was to make the payment more feasible not affordable increasing the negative equity homeowners psychological attitude connected to “Pride of Ownership” of responsibility and obligation by the financial incentive, benefit, compensation, advantage of a modification enabling the negative equity homeowner to "save face" for remaining a negative equity homeowner when it would be financially benefical to default instead.
16-2 The creation of Strategic Defaulters is a direct result of the current system of modifying. Research has shown that one out of every four defaults are from people who can afford the monthly payment but owning a negative equity home is a losing financial proposition for anyone with negative equity. The researchers admit that the number is most likely higher because what negative equity homeowner would openly admit that they defaulted on purpose opening themselves up to legal and financial problems, example deficiency judgements.
16-3 Because 3.6 million modifications were issued for free, there are only two options after reading the copyright of the bottom of this page, the servicer pays the processing fee to Negative Equity Streamlined Uniform Modification System directly or The U.S. Treasury pays the fee to Negative Equity Streamlined Uniform Modification System from the TARP funds, the intended purpose of said funds, if every existing negative equity homeowner accepted the National Standard Modification the cost would be 8.2 billion dollars. And if industry experts are correct about housing values decreasing the cost to modify all existing and future negative equity homeowners would still be less than the remaining TARP funds.
17- I am not an attorney nor will any member of my staff be responsible for the confusion, legalities and technicalities surrounding MERS and robo-signing but common sense dictates that:
17-1) the homeowner was not financially harmed by a break in the chain of title whether the mortgage was paid or not, But it is up to a court of law to decide if the homeowners constitutional rights were and the appropriate fines and penalties and so far their views have been very different, but they are leaning toward homeowners as a matter of general public importance and the financial industry is not exempt from following the rule of law, example Nevada, Massachuettes, New York, Vermont and any others not mentioned.
It is the strong suggestion of the Negative Equity Streamlined Uniform Modification System that the investors of all mortgages affected by the use of MERS , robosigning, or restriction of negative equity modifications get ahead of the coming mass joinder suits, class action law suits, individual civil and tort law suits from homeowners and the penalties eventually place on them by the government from the public's outrage about requiring immunity from future litagation WHEN THE VIOLATIONS ARE STILL OCCURRING by adopting a program that has built in penalties for the past injustice's that have occurred, without admitting any wrongdoing or liability by showing the public and the legal system that the financial industry does follow the rule of law and complies with all existing law by utilizing the Negative Equity Streamlined Uniform Modication System.
Paying a filing fee and pre-agreed on fines and penalties correcting the disceptancies vs. an across the board principal reduction for all negative equity homeowners plus any cash settlement for every homeowner within the MERS system.
NOT including the free houses being awarded because the trust can not show legal standing forcing the real holder of the note to prove ownership.
17- 2 If the homeowner agrees to the modification any break in the chain of title is mute, they are accepting who the owner of the note is with the written guarantee that the note holder is the actual holder of the note and have the right to issue the modification or foreclose. Servicers do not have the right to pick and choose what function they are allowed to do, it is both. The servicers legal department will prepare a template statement that the homeowners' signed recorded modification papers take the place of any misplaced or lost original mortgage notes clarifying and reaffirming the CURRENT validity of the note’s ownership eliminating any questions about chain of title issues to expedite any future foreclosure. NESUMS will advise the homeowner of any credit correction letters due the homeowner.
The automatic penalty is the current holder of the note is responsible for the recording fee's to the appropiate party, there is no reimbursement to the homeowner for the use of MERS. The guarantee given to the homeowner is from the current investor and their trustee, if applicable for any future discreptancies that may arise from another note holder claiming ownership of an originial note, that is included in the modification form and recorded. It is suggested that an ANMESTY period of two years be given to the financial industry to clear up any lost, missing or destroyed notes, in view of the closing of so many original note holders originators. The document must specify that an note/ assignment is missing with a valid reason, such of out of business allowing the assignment to be obtained after the fact, the automatic fine is the recording fee is paid for each missing or delayed note or assignment as a penalty for "bad record keeping" from the AG's fund, trustee or investor, respectively. If the document (proof of being the holder of the note) during the anmesty period is proven to have incorrect dates or fraudulent information to save the paying of the recording fines, the fine is $100,000. to be split 75% to the homeowner and 25% to the local recording office for reviewing said documents. Alfter the two year ANMESTY period expires, all orginial notes and their assignments are the responsibility of the investors AGENT or TRUSTEE to maintain.
17-3 If the homeowner refuses to be modified, they will be contacted by the team leader to verify the refusal of a national standard modification, ending the concept of obtaining a "free house" and the "free rent" game before informing the servicer in writing on the NSMET form of the homeowners refusal, restarting the foreclosure clock. The NSMET form establishes the payment due to NESUMS. The automatic penalty is the recording fee's are to be paid by the current holder of the note and their trustee, if applicable with a guarantee to the court that takes full financial responsibility from any future discreptancies that may arise from another note holder claiming ownership of the originial note. The assignment and guarantee is recorded prior to a foreclosure occurring with the same suggested anmesty guidelines and penalties. NESUMS will apply for any credit reporting corrections.
17-4 The idea is the homeowner didn't pay their mortgage which they had agreed to, the excuse they didn't know who was the actual holder to the note is weak, most people know who they owe money to or at least the last party they paid it to, whether there is a break in the chain of title that the homeowner didn't or doesn't know about does not excuse the homeowner from paying what he owes, regardless of the issue surrounding his constitutional rights.(2 wrongs don't a right). And why
17-5 If there was equity involved , the homeowner NEVER LOSS their right to sell or refinance without restriction to the mortgage note from a lapse in the chain of title. The automatic penalty is the recording fee's are to be paid by the current holder of the note with a guarantee to the homeowner that takes full financial responsibility from any future discreptancies that may arise from another note holder claiming ownership of the originial note. Homeowners not applying for a modification or going thru a foreclosure, must apply directly to their servicer for the guarantee, if desired, they will have a period of 2 years to obtain said guarantee. The servicer is expected to have a separate division to handle the requests with the recording fees paid for by the AG's FUND, trustee or investor, said quarantee is recorded. The CFPB is responsible for ensuring the issuance of any requested guarantees, the automatic fine is $1000 payable to the CFPB to cover the cost of expenses for non complaince if the guarantee is not issued within a 90 day window fom a request. There is no excuse for not issuing a guarantee, if the holder of the mortgage "believed" that MERS had a legal right to foreclosed. Homeowners applying for a modification or going thru a foreclosure, the guarantee is issued within the process. Any homeowner who has paid off their mortgage or does not have a mortgage should not require a guarantee, but if there was a previous mortgage on the property and the satisifcation of mortgage has not been recorded, the homeowner can request the guarantee with the recording of mortgage satisification from their last servicer with a second resort of the CFPB.
17-5 MERS had become and has been the standard and common operating procedure of acceptable "mortgage assignments" in the mortgage industry, there was a general knowledge that the practice was a way to save the investors money that was supposed to be paid to local reporting agencies, the investors automatic penalty for engaging in this practice is to pay the unrecorded assignment fees to the appropiate state or local reporting agencies reimbursing the parties who WERE financially harmed and correcting any infringement of the constitutional rights of the homeowner,without admitting any wrongdoing of whether the act was intended, unintended, or just applied because of normal business operating procedures. It is suggested that State Attorney General conference with NACRC, and IACREOT to develop a flat rate to pay the recording fee's to the appropiate agencies. It is further suggested that the State Attorney General conference with the National Title Network and ALTA for a flat rate for recording services.
17-6 The automatic penalty of the recording fee's to be paid by the current note holder at time of the request, modification or foreclosure, leaves open the possibility that the current note holder will sue the previous note owners to recoup the same "savings" they all experienced. One suggestion could be for the Attorney Generals to instill and share the investor's cost among the remaining players, since a majority of the "players" have left the business. The cost to cure for an estimated 32 million homeowners within the MERS system would be 6.2 billion dollars if a flat rate of $200 was obtained.
17-7 The penalty of the recording fees will also be applied for past foreclosures with the same guarantee if MERS was involved PLUS 1) if there was negative equity involved at time of the foreclosure and the homeowner was not offered a modification to avoid the investors financial loss while being delinquent on their mortgage payments, the fine/penalty paid to the homeowner is $1,000. minus any funds received such as cash for keys and the simultaneous fine of $1000 is payable to the investor directly or from the trustee disbursing the fine among the investors of the pool paid by the servicer 2) if there was equity involved, the homeowner is not paid anything because they could have sold the home and the investor wasn't financially harmed. The rationale is there has been almost 4 million foreclosures since the start of the deflationary cycle and the financial industry was responsible to maintain long termed economic stability and the above HOMEOWNERS of the foreclosures were financially harmed in some way even though they were wrong and didn't pay their mortgage. Any homeowner since the inception of HAMP is eligible for the payment and can applied directly to the loss mitagation department of their previous servicer, the trustees are responsible for applying for the automatic fine for work not performed in their best interest with the knowledge that the investors are responsible for all past recording fees. Estimated penalty is 4 Billion Dollars
17-8 With the above system in place, robo signing will automatically stop due to two reasons, 1) no foreclosure may take place without a NEMET form showing the owner was eligible for a modification and refused or the owner was not eligible for a modification or a temporary modification and 2) if the amount shown of the foreclosure papers is incorrect and contested by the homeowner, there is an automatic penalty to the servicer equal to the amount of "arrears" charged to the homeowner including any late, processing or junk fees, payable to the court PLUS an automatic $10,000. fine besides for the homeowners balance being lowered for the same amount including the fine. Make the penalty severe enough, the servicing industry will amend their ways by REALLY double verifying the information with all employees signing in ink that they personally verified the information with a two year payment history attached that is easily read by the layperson and sent to the client for review 30 days prior to any foreclosure date. Prior to the foreclosure, the homeowner must receive the right to contest any errors in the amount due by registered mail in easily read terms with the understanding THAT NO ACTION ON THEIR BEHALF SIGNIFIED THAT THE AMOUNT DUE IS CORRECT AND THAT ALL IT WOULD TAKE TO CONTEST THE AMOUNT IS A REGISTERED LETTER BEING RETURNED TO THE SERVICER IN A JUDICAL OR NON JUDICAL STATE WITH A COPY TO THE CFPB.
17-9 Going forward the horror stories of "clerical mistakes" made from robo-signing will not be tolerated , examples foreclosing on wrong house or a house that the servicer/investor does not have a mortgage with or was paid off, foreclosing because of misallocation of homeowners funds not being applied to the correct account. The automatic penalty is twice the dollar amount of the value of the home minus any true outstanding mortgage and the reversal of the foreclosure at the "employers of the employee making the mistake" expense to the homeowner. If the home has been resold, the penalty is three times the fair market value minus any true outstanding mortgage. Make the penalty severe enough and the "errors" will stop. The servicer is expected to maintain a separate division for such complaints with a computerized dated system showing complaint, resolution and the payment to the homeowner within a 60 day timeframe from the certified mailing of the request for correction. The Office of the Comptroller of the Currency has the right and responsibility to periodically, MONTHLY at the minimum go in to the computer system to verify compliance. The homeowner has the right to hire an attorney to defend the above, with the attorney fee's being paid by the EMPLOYER of the employee who signed the accurancy of the foreclosure papers.
17-10 With the recent volume of mistakes made, the bank has an one time opportunity to correct the above errors by contacting the attorneys of the foreclosed homeowners reversing the foreclosure if the home was not sold and paying the full appraised value of the home to the homeowner minus any foreclosed mortgages on it without including any additional interest arrears, late payments, or any charges. If the home was sold, the homeowner will receive two times the appraised value minus any true mortgages on the property. In both cases, it is the servicers responsibility to have the foreclosure erased from the homeowners credit report.
18- The exception to the normal course of business is if the loan was orginated in a non recourse state, it WILL remain or return to a non recourse loan, regardless of whether it was a purchase or a refinance, the object is to encourage negative equity homeowners to remain negative equity homeowners
19- All negative amortization stops at the time of the modification.
20- A new second mortgage or line of credit is not allowed to be obtained on any modified loan; a refinance must take place for any second mortgage to be obtained.
21- Second Mortgages--All second mortgages have the same legal right to be modified. All negative equity homeowners have the right to be simultaneously modified for both mortgages under the standard uniform modification guidelines with one exception: BOTH investors’ sliding scale match equity pay is proportion to the negative equity involvement per a pre-arranged chart that does not penalize or wipe out the 2nd mortgage holder. * No first mortgage can be modified without the second mortgage also being modified protecting the 2nd mortgage holder.
22- There is a reverse investor sliding scale equity sharing on any future appreciation above the modified mortgage amount for the first 10 years, if a matched equity pay was involved.
23- Selling the note to a "debt" purchaser does not eliminate or change the note holders obligation under the above rules stopping the "double dipping" practice harming homeowners. There are no deficency judgements allowed with a sold "debt" and the new holder of the "debt" is obligated to all above rules.
24- Deficency judgements will only be allowed for the following scenarios, it is an all or nothing process, there is no longer picking and choosing allowed, one rule for all:
24-1 A deficency judgement is allowed when the negative equity homeowner was offered a modification and refused unless dismissed by a bankruptcy court. Stops strategic defaulters, not negative equity homeowners who really can't afford the home with a modified payment by allowing them a "clean slate" with a bankruptcy.
24-1 A deficency judgement is allowed when the negative equity homeowner was offered a modification and refused AND is unable to supply a REAL purchaser to purchase the home at CLOSE to the FAIR MARKET VALUE, representing a short sale or proof has been submitted that the home was listed from time of initial delinquency for a reasonable sales price representing the fair market value with a licensed real estate professional who must sign an affadavit under penalty of perjury that said home was listed.
The individual servicers’ offer to modify negative equity homeowners is limited to 24 months and ends on the anniversary of joining the Negative Equity Streamlined Uniform Modification System reverting back to the standard capitalist operating practice and procedure of “if you don’t pay, you will be foreclosed on”.
All ownership and origination rights and interests in the uniqueness, such as the guidelines, rules, penalties or sliding scales of the Negative Equity Streamlined Uniform Modification System are protected by the certified mailing of the proposal through the United States Postal Service. Any use in whole or in part of any component(s) of the system entitles the Negative Equity Streamlined Uniform Modification System to the full standard modification fee per each use- unless prior written permission has been granted to be used in part or in full of the Negative Equity Streamlined Uniform Modification System to any lender, servicer or for the governments modification system or process. In the event the need to prove proof of ownership arises of mailing the proposal out to multiple lenders, servicers, organizations and the U.S. government, the above action shall constitute such proof of ownership and authorship.