Dummy Proof Your Way to Foreclosure Workout Help

Bad things really do happen to good people!
If you don’t believe me, just ask the Thompsons [name changed].

The Thompsons contacted Reinstatement Services at the end of last year looking to secure a workout as an alternative to foreclosure. In Feb’07, the first workout was secured.

Terms of the Forbearance - homeowner to make 3 consecutive payments [March, April, May] of $2,150.00. Pending timely payments, the loan would be modified in June and $28,262.92 would be absorbed into the principle balance.

June 26th, Mrs. Thompson phones in a panic.

“Our lender is not going to do the modification!” Mrs. Thompson has a really nice sounding french accent so I am momentarily enthralled before it dawns on me that she is delivering bad news.

“What do you mean, they’re not doing the modification? That doesn’t make sense, we’ve got a formal agreement.” I’m puzzled but have done this long enough to know there is more to this story.

“Well…I call them up and they tell me to stop making the payment for June because they could not do the ‘mod-ee-fee-kay-cee-own’ [I love the french] until I get the lein off ‘ov’ the title.”

I let go of the seduction long enough to realize something about a lien on title has the workout’s survival teetering on a very thin wire. Snap out of it, I tell myself…she’s a girl anyway, what are you thinking. Focus on the words. Focus on the words.

So I begin to do just that.

“What lien are they talking about?” I inquire.
“I don’t know”, comes the response.

So I do what most professionals would do in my position, I hang up.
…but not before I say, “we’ll have to find out. But before we do that, what’s this business about not making a payment?”

“I don’t know that either. I called and they told me not to make the payment. So I didn’t.”
“O-k-a-y…but why didn’t you phone me to tell me of this new development?”
“I thought the lender was working on fixing it.”

Sigh!

I quickly gather, this is not going the way I’d like and I’m starting to have second thoughts about allowing the seduction. Also, I’m starting not to like the french. So I sign off stating that I’d call back as soon as I spoke with the lender.

Here’s the deal.
I speak with Judy in the Loss Mitigation department who promptly informs me that she can’t move forward with, basically, the deal of a lifetime, because of a $1,196 lien on the property report. I ask what it is…she says she’s pretty sure its a utility debt but has no further information. She says since the end of May she’s left a series of messages for the homeowner requesting call returns [to no avail] before closing file and sending a forbearance denied letter out.

I chat Judy up for a bit [see, I’m not opposed to kissing up] and get her to agree to reopen the file. She says she’ll do it but only for a week. We need to submit proof of paid lien by July 5th.

I call Mrs. Thompson and relay the news and the deadline. She says great she’ll work on isolating the utility lien and making the payment.

I call in my assistant and order out a batch of McDonald’s fries. Second workout secured…I’m back in love with the french.
I’m ready to be supersized!

Sometime around Monday, July 16, I realize I’ve not heard back from the Thompsons. I can’t email. Thompson’s have no email access; so,I call. Voicemail box full. Can’t leave message… but I listen to their outgoing message twice anyway since it is delivered in both English and French!

I wait.

Mrs. Thompson calls back shortly [Thank God for caller ID. Sometimes.].
“Hi,” she says. “I see you called.”
“Yes. I wanted to touch base to determine if you took care of the lien. We’re way past the deadline imposed.”
“Oh,” she says. “I just made the payment on Friday. Did you get it?”
“Get what?”
“The payment.”
“Did I get the payment?”
“Yes.”
Now I’m really confused. “Did you make your lien payment to RSI?”
“No, I paid the sheriff.”
“Has the lien been cleared?”
“I don’t know.”

Here’s a little known k——-fact: If it weren’t for my lack of patience…I’d be almost the perfect being.

I sigh.

“Mrs. Thompson, we had until the fifth to get the information to your lender. That has long been passed. Are you still interested in keeping the property?”

She says yes so I say then I need proof of paid status to submit. She says she’ll fax it tomorrow.

Fast forward to real time - TODAY

Mrs. Thompson faxes over the proof. Indeed paid on Friday. I call lender to announce I’ve got the golden goose in my hand. No such luck.

Judy closed the file on Thursday, July 12th and sent it back to the foreclosure department.

We’ll have to start from scratch.

The Thompsons will have to swallow the bitter pill of having to pay RSI again to rework the file.

As for me… well, I’ve sworn off french fries indefinitely.

Lessons:

1. A French accent will only take you so far before the honeymoon phase fizzles out.
2. If you are working with a third party service, make certain they are kept informed. Complications can be warded off with a quick call to your expert.
3. Liens ALWAYS affect loan modifications. Make certain title is clear or documented payment arrangements on the lien debt have been made to avoid jeopardizing a loan modification workout.