Loan Modification Hell: File Complaint with OCC For Lender Delays

Q: Help! I have been faxing, mailing, over-nighting all kinds of paperwork to my lender. I have a well documented phone conversation log and receipts of documents I have sent my lender.

I’ve been applying for a loan modification since last October. From October until the end of December was a big waste of time. After sending in all my documents, this past January, the bank wanted all new paperwork. Then they took 60 days before we heard from them again.

My husband is a carpenter who is laid off. We are a family of five and now with this layoff there is very little income is coming in and it’s killing us. We need heating oil. We’re two months behind in our bills and I now have hives from worrying!

Do I hire an attorney? Do I borrow more money from friends for next month’s payments? Or, should we walk away from our house now?

A: I’m confused why you didn’t get a yes or no on a loan modification within 30 days. The new loan modification rules are in effect, and your lender is supposed to comply with these rules.

Unfortunately, the loan programs have not been structured to assist borrowers quickly and there are still lenders out there that have not gotten their act together in working with their borrowers or processing the loan modification paperwork.

Please file a complaint with the OCC (which regulates your big box bank) at Please send me the case number and I’ll forward it to my contact.

That said, you have to understand that not everyone gets a loan modification and that you may ultimately lose your house. You should also know that very few borrowers actually got permanent loan modifications, and that the loan modification program is an “opt-in” for banks and is entirely voluntary.

Start to formulate a plan B so that you know where you’re going to go if you don’t get a loan modification. While you can hire an attorney, the real question for you is whether hiring an attorney and paying any money to that person would get you a different result. I’m not sure it would. (If you can’t afford an attorney, please contact a legal aid society in your area.)

Given that only about ten percent of people that applied under the federal program received permanent loan modifications, the odds are not in your favor. Furthermore, if you have already provided the bank with the necessary paperwork, an attorney may not have much to do to help you.

If your lender committed a fraudulent act when you were given your loan or there are other legal circumstances surrounding how and when you got your loan that would require you to seek legal assistance, you might want to do that.

If you stop making payments and do nothing, you’ll wind up in foreclosure. You may need to understand the foreclosure process in the state you live in to determine what your next step will be during this housing crisis.

Good luck, and let me know what happens.

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4 Responses to Loan Modification Hell: File Complaint with OCC For Lender Delays

  1. dlupo says:

    I have my loan with AHMSI. I applied for the modification last year. in March of 2010 I rcvd a letter from them stating the mod. was processed. I rcvd all the documents & the notarized letter. Then 8 mnths later I rcvd out of the blu a new mod. the mnthly payment 200.00 more & int. rate up almost 1 point. I called them and was told it was because I was past due. TOTALLY UNTRUE, I was up to date when I started the process. then I was told my property taxes went up, hazard ins, in other words they had no clue. Finally i called HOPE and was told they made a 30,000.00 mistake. I told them my loan was already modified & processed. They sd it wasnt. I said I have the info. ayways ive been payng the monthly payment but im paying the modified amount. HOPE said they are dealing with their managers, and they dont agree with what they are doing. However my last statement I was charged 100.00 for FORECLOSURE!!! Im so disgusted & stressed out. Our credit is worse than before we started. The mtg co also has wrong mnthly pymt on credit report. I asked for them to fix, they sd No its correct. ITS BULL. We have creditors sending usd letters decreasing our line of credit. Do I hire an attorney? Honestly I cant afford one though. How can they modify & process our loan, send all the documents with a letter from them, stataing the mod. was processed, then 8 mnths later just send us a new mod.? Thank You

  2. cathy says:

    Could you please give me the phone number to OCC to file compaint for bad loan mod I obtained through a law firm .

    Thank you very much.

  3. Angela Flores says:

    Are Loan modifications.. becoming easier.. through Chapter 13, Litigation.. I make the money to afford the payment.. why are they giving me a hard time..?

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