If you are behind on mortgage payments, and get approved for a loan modification and new payments….?

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what happens with the amount you are still behind on? We are 3 months behind on payments, but say we get approved. Do we have to pay the amount we are past due on, or do they work that into the new loan agreement?

I would like to see each and every one of those liarstarred and feathered or put in shackles or some other sort of public humiliation.A lien against their earnings until at least a percentage is paid off. Own a car but defaulted on your home loan? Bus for you scooter. We’re taking your car. Big screen TV? Gone. Cellphone with all those cool web-apps? Gone. Your meals will consist of Ramen noodles and Kool-Aid until you pay off your debt.
I guess I’m just a ‘lil peeved at this whole situation and the way the scumbags who signed a loan agreement then defaulted are costing the whole country a ton of money.
I have never in my life signed a debt agreement that I did not pay back. Whether right out of college to get $ 5000 from my parents or the first time I bought a car I repay loans and consider them a must-pay debt. Spread blame where ever you would like, but the simple fact is that people KNOWINGLY took on debts they couldn’t afford to repay and they alone are responsible.

16 Comments
  1. Reply
    Steve D
    February 8, 2011 at 11:59 am

    Depends on the mod – you should be able to just mod the loan and start all over (with the three month’s interest added in). Check with your loan officer as to how the lender handles this.

  2. Reply
    reenzz
    February 8, 2011 at 12:42 pm

    That should be worked into the new agreement. You really need to ask your lender this.

  3. Reply
    Ryan M
    February 8, 2011 at 1:10 pm

    Have you tried actually reading the details of your modification?

  4. Reply
    Mathew
    February 8, 2011 at 1:19 pm

    There could be more than one answer to your question. It would depend on how the loan was modified. Any past due could be added to the remaining balance and will be paid off in due course of the loan or the past due could be canceled. In the latter case any canceled debt becomes taxable income to the debtor.

  5. Reply
    David Z
    February 8, 2011 at 1:49 pm

    past due amount will roll into new payment.

    Make darn sure you can abide by new payment plan. do not agree if you cannot do it with room to spare.

  6. Reply
    Barry
    February 8, 2011 at 2:42 pm

    Hello everyone,

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  7. Reply
    Avery
    February 8, 2011 at 3:30 pm

    Mortgage loan is a term used for the loans secured by a property. Mortgage loans refer to a loan secured by residential property, often for the purpose of securing real estate. Mortgage loans are priced lower than other loan structures because the value of the property risk for the lender.

    http://www.worldbestloans.com/Mortgage%20Loan.htm

    A fixed rate mortgage loan has its own benefit. If the borrower is budget conscious, he will remain at peace because the monthly mortgage amount will not change.Fixed rate mortgage loan is a loan where the interest rate remains the same through the term of the loan. Fixed rate mortgage loans are the most traditional form of loan.

  8. Reply
    Doctor Deth
    February 8, 2011 at 4:12 pm

    if they are modifying the full balance due, then it would seem to me they are taking that into acct and should be wiping out the missed payments – if they are just adjusting the rate, then they will probably recalc the monthly payment based on the full UNPAID balance, plus the interest from those 3 missed pmts, so the new pmt will be higher than if you had actually made those 3 payments – just my guess

  9. Reply
    bobby
    February 8, 2011 at 5:05 pm

    It depends on the modification. If you are only 3 months
    behind and get a modification done properly, you should
    have been able to get forgiveness for those payments.
    Make sure you check the agreement before you sign it,
    it should have all the new terms – how much further
    are you from getting approved?

  10. Reply
    Joseph
    February 8, 2011 at 5:15 pm

    Hi,
    Most of the time late payments will be added to the back of the mortgage. The only time this will really have an affect is when you eventually sell or refinance the home. When doing a loan modification, you will not have to pay the amount past due immediately as it will be added to the end of the loan thus increasing your outstanding balance. Assuming you get approved for the agreement, your total payments will end up being lower as your lender will more than likely reduce your interest rate significantly

  11. Reply
    Chimes
    February 8, 2011 at 5:53 pm

    I´m guessing that the ones who have mortgages and pay them off will somehow be taxed higher on their assets (you and me). I am guessing the people who do not pay, lose their asset unless they are connected politically. The ones who cannot pay will rent a home or apartment.

  12. Reply
    thethirdheat
    February 8, 2011 at 6:01 pm

    Most likely the “deadbeats” credit score will take a hit. I think back in the 19th century there used be a debtors prison. It was a jail for people that didn’t pay back loans.

    I think what your describing is what is referred to as a recourse mortgage (I can’t think of the name). That type of mortgage is common in Europe (I believe).

    I know the homeowner is blamed in the media as the culprit to this whole mess, but like most things in life, the cause isn’t so clear.

    What about all those people that loaned money to the “deadbeats”?
    What about the banks that bought and sold the mortgages as MBS (Mortgage Backed Security)?
    What about the banks that sold “insurance”(gamble) on those same MBS?
    What about the wall street executive turned treasury secretary that sold MBS to other investors and turned around and shorted that very same MBS?
    What about the credit rating agencies that rated these CDOs with all the MBS as AAA?
    What about the investment banks that leveraged themselves to 30 times their cash assets?
    What about the people that said and believed “home prices always go up”?

  13. Reply
    tk
    February 8, 2011 at 6:23 pm

    1) They will be sued by the banks.

    2) They will be forced into bankruptcy

    3) They will rebuild their credit and go on

    4) They are not the problem behind this economic meltdown, you may misunderstand the base cause.

    5) Greedy and unregulated people who highly leveraged the bad debt which in turn was leveraged and propogated across all the greedy investment houses and banks…that is the issue

    6) Get angry as greedy and corrupt politicians, mostly republicans, who allwed this greed to live unregulated.

    7) be angry at the government for socializing the bad debt in the banking system to you and I, of which bad mortgage debt was a tiny sliver of the problem

  14. Reply
    reneem1954_2000
    February 8, 2011 at 6:47 pm

    You obviously never had anything bad happen to you. We paid on our house for years and still lost it (too late for us!) We had our daughter pass away(funeral expenses), one son became ill for awhile( not going to help him?), I lost my job to Mexico and 6 months later (though I found a job) became disabled through no ones fault (hereditary), and had NO income for 2 years. We lived off the savings the best we could. We did not have a cell phone,or fancy vehicles,etc. We lived simply(never ate out, canned, recycled, etc) We saved but it went only so far with medical and rising prices.
    I think you generalize too much. I agree there are people out there who abuse it. But they do have now have laws for which you pay some or part back. We were lucky for the first time in a long time to be able to wipe the slate clean. I do have a friend who has filed twice due to giving the kids everything and just plain blowing it. She is now disabled and needs to file again but can not.
    I think you should thank God you are where you are at cause it can change any time in your life AND I hope BAD things never happen to you or to the ones close to you.(Quit gloating and looking down your nose at everyone who has filed or lost a house, not all of them are that way. Especially with this economic mess!)

  15. Reply
    PTL
    February 8, 2011 at 7:21 pm

    The LAW of

    UNINTENDED CONSEQUENCES

    “How Democrats lied to America.”

    AND DESTROYED

    “THE AMERICAN DREAM”

    And cost

    American Homeowners & Taxpayers

    10 TRILLION DOLLARS

    1977: President Jimmy Carter signs the Community Reinvestment Act (CRA) into law.

    The law pressured financial institutions to extend home loans to those who would otherwise not qualify.
    The LIBERAL Premise:
    Home ownership would improve poor and crime-ridden communities and neighborhoods in terms of crime, investment, jobs, etc.
    Results: Statistics bear out that it did not help.
    How did the government get so deeply involved in the housing market?
    Answer: Bill Clinton wanted it that way.

    1992: Republican Representative Jim Leach (Iowa) warned of the danger that Fannie and Freddie were changing from being agencies of the public at large to money machines for the principals and the stockholding few.

    1993: President Clinton extensively rewrote Fannie Mae and Freddie Mac’s rules turning the quasi-private mortgage-funding firms into semi-nationalized monopolies dispensing cash and loans to large Democratic voting blocks and handing favors, jobs and contributions to political allies.

    This potent mix led inevitably to corruption and now the collapse of Freddie and Fannie.

    1994: Despite warnings, President Clinton unveiled his National Home-Ownership trategy that broadened the CRA in ways congress never intended.

    1995: Congress, about to change from a Democrat majority to Republican, President Clinton orders Robert Rubin’s Treasury Department to rewrite the rules.

    Robert Rubin’s Treasury reworked rules, forcing banks to satisfy quotas for sub-prime and minority loans to get a satisfactory CRA rating.
    The rating was key to expansion or mergers for banks. Loans began to be made on the basis of race and little else.

    1997 – 1999: President Clinton, bypassing Republicans, enlisted Andrew Cuomo, then Secretary of Housing and Urban Development, allowing Freddie and Fannie to get into the sub-prime market in a BIG way.

    Led by Representative Barney Frank and Senator Chris Dodd, congress doubled down on the risk by easing capital limits and allowing them to hold just 2.5% of capital to back their investments vs. 10% for banks.
    Since they could borrow at lower rates than banks, their enterprises boomed.
    With incentives in place, banks poured billions in loans into poor communities, often “no doc,” “no income,” requiring no money down and no verification of income.
    Five Million Undocumented loans went to Illegal Aliens.
    Worse still was the cronyism: Fannie and Freddie became home to out-of-work politicians, mostly Clinton Democrats.
    Politicians numbering 384 got big campaign donations from Fannie and Freddie.
    Over $ 200 million had been spent on lobbying and political activities. During the 1990’s Fannie and Freddie enjoyed a subsidy of as much as $ 182 billion, most of it going to principals and shareholders, not poor borrowers as claimed.
    Did the CRA work?

    Minorities made up 49% of the 12.5 million new homeowners but many of those loans have gone bad and the minority homeownership rates are shrinking fast.

    1999: New Treasury Secretary, Lawrence Summers, became alarmed at Fannie and Freddie’s excesses.

    Congress held hearings the ensuing year but nothing was done because Fannie and Freddie had donated millions to key congressmen and radical groups, ensuring no meaningful changes would take place.
    “We manage our political risk with the same intensity that we manage our credit and interest rate risks,” Fannie CEO Franklin Raines, a former Clinton official and current Barack Obama advisor, bragged to investors in 1999.

    2000: Secretary Summers sent Undersecretary Gary Gensler to Congress seeking an end to the “special status.”

    Democrats raised a ruckus as did Fannie and Freddie, headed by politically connected CEO’s who knew how to reward and punish.
    “We think that the statements evidence a contempt for the nation’s housing and mortgage markets,” Freddie spokesperson Sharon McHale said.
    It was the last chance during the Clinton era for reform.

    2001: Republicans try repeatedly to bring fiscal sanity to Fannie Mae & Freddie Mac

    Democrats blocked any attempt at reform;
    Especially Representative Barney Frank and Senator Chris Dodd who now run key banking committees and were huge beneficiaries of campaign contributions from the mortgage giants.

    2003: Bush proposes what the New York Times called “the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.”

    Even after discovering a scheme by Fannie and Freddie to overstate earnings by $ 10.6 billion to boost their bonuses, the Democrats killed reform.

    2005: Then Fed Chairman Alan Greenspan warns Congress: “We are placing the total financial system at substantial risk.”

    Sena

  16. Reply
    nobull54
    February 8, 2011 at 7:30 pm

    What will happen is they will run for state rep or congress as a republican in the next election. I’d like to see some punishment, especially for the finance guys who gamed the system.

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