Attorney Misty Oaks: 5 Things You Need to Know About Loan Modifications


The worst housing crisis this country has seen since the Great Depression arguably began when the housing bubble started to burst in 2005-2006. Prior to and even during that time, the term “mortgage modification” was virtually unheard of and the process of obtaining one was even less understood. Fast forward to the landscape of the 2011 housing market where foreclosures are predicted to reach their peak this year and you will come to realize a sad but undeniable truth: the people who need and are seeking mortgage modifications are still not clear about what it is they are seeking. The lack of options that are available, the frustrating negotiations, the unclear processes, and the pandemonium that too often accompany the modification process are the rules rather than the exceptions.

For those who are looking for someone to sort out all of this mortgage modification madness, I offer the following five things you need to know about mortgage modifications in easily digestible chunks. Enjoy.

1.) HAMP is not God. Most Americans have heard the term HAMP by now. It stands for Home Affordable Mortgage Program. It is the federal program designed to give homeowners some of the lowest interest rates and most favorable terms should they get approved for a mortgage modification. What most Americans don’t know is that HAMP is not the be all end all. There are some other modifications programs that can assist homeowners who do not fall within the fairly stringent parameters that HAMP requires. So if it appears that you don’t qualify for a HAMP modification, don’t worry. You’ll have other programs like CAP Modifications, Flex Modifications, Traditional Modifications, and In-house Modifications to look forward to. And keep in mind that a modification is not your only option, period. There is a program in about 17 states called, the Hardest Hit Fund (HHF), there are programs called Home Affordable Foreclosure Alternatives (HAFA), and for the lucky few of us who are not underwater in our mortgages, there is the potential to refinance. Not sure what options you qualify for? Hmmmm … sounds like something I could help you with. See Number 5 below.2.) This process can be incredibly frustrating, as if that were a big surprise. Lenders are inundated with thousands of requests for mortgage modifications daily and most homeowners who apply for a modification on their own usually submit incomplete, incorrect, or down-right insane paperwork to their mortgage company. The sheer volume of requests and the fact that many homeowners haven’t a clue as to how to apply properly for a modification can make the process, well, painful. And to be fair with the finger-pointing, most Lenders have disgustingly inefficient processes in place for handling modification requests. I hear the horror stories all the time from my clients and have born witness to most of them first-hand.

Oftentimes, homeowners get turned down for the most inconceivably ignorant reason(s) in the world and cannot for the life of them figure out why they end up being sent back to square one. But to turn your frown upside down, let me share a secret with you: The Office of the Comptroller of the Currency (OCC), has recently ordered ten major mortgage lenders in the United States to revamp their mortgage modification policies and procedures to make them more efficient, more transparent, and more seamless for thousands of homeowners to actually ‘get somewhere’ when applying for these modifications. That is HUGE not only because the OCC has forced these lenders to make important changes, but also because homeowners who are being unjustly denied by these mortgage companies have a place to complain to and authority to back them up.

3.) Help is on the way … well maybe. I’ve heard them, you’ve heard them, we’ve all heard them. The stories of ‘loan modification’ companies popping up, promising to modify homeowners’ mortgages and then doing absolutely nothing for the homeowner except taking their money. Many states have enacted mortgage fraud prevention statutes to shield homeowners from this type of behavior that can have devastating effects. So the moral to the story here is buyer beware. In my view, asking a mortgage company to adjust or modify the terms of a contract (your mortgage) is tantamount to the practice of law. I always tell people, “Applying for a modification on your own is like filing for Bankruptcy on your own or representing yourself in court. You can do it by yourself, but do you really want to and do you really know how to?” Therefore, if you’re going to get someone to help you in your quest to obtain a mortgage modification, make sure it’s someone who knows the various options and requirements, who knows how to navigate this process, who is a good negotiator, and who has gotten great results in the past … preferably a lawyer. There is something to be said for the non-profit entities like HUD and NACA that have provided tremendous help to homeowners for free, but honestly, the old adage of ‘you get what you pay for’ applies.

4.) Have your paperwork together. If you do decide to tread down this windy road alone, make sure that you have everything in order so that your first trip will be your last. You should obtain a modification request package from your lender, which will tell you all the information your lender requires to make a determination on your modification. Fill in everything completely and if something doesn’t apply, be sure to put N/A so that there is no confusion as to whether it applies to you or not. Gather all of the supporting documentation your lender requires that applies to you. Notice I said ALL, not some or most. Mortgage companies routinely deny homeowners for a modification on the grounds that ‘the paperwork requested was not received.’ You do not want to have to start the modification process all over again because you neglected to include a simple document that you had sitting in your file cabinet the entire time. Not a good look. And please, please, please, for the love of God, don’t forget about the stage after you send your paperwork into your mortgage company: aftercare. Don’t send your modification to die on a loss mitigation processor’s desk. Weekly contact with your mortgage company’s loss mitigation department to make sure your file is progressing appropriately is not optional—it is required.

5.) And last, but certainly not least, if you don’t understand this process—GET EDUCATED. Oftentimes people ask me, “Do I need a lawyer to do a modification for me or can’t I just do it myself? Lawyer’s fees are too high.” And my response to this question always is, “Your modification will cost you one way or the other. Either you will pay a lawyer or a loan modification company to take over the process and attempt to get the results you seek, or you will pay to get educated about the process and then do it yourself. In the worst case scenario you will end up paying by remaining stuck in the cycle of applying and getting denied because you insist on saving money and skimping on your education about this process.” If there’s one thing that owning and running my law firm has taught me, it’s that I cannot save everybody. But what I can do is enlighten and empower people to take control of their own destinies with the power of knowledge.

The Oaks Firm currently provides seminars, workshops, webinars, teleconferences, and many other resources to help educate the millions of Americans who are suffering through this housing crisis. At the end of the day, it is your home, your mortgage, and your responsibility to do something about the situation that you’re in. So what are you going to do about it? If you don’t know … you should find out.

Attorney Misty Oaks is a writer, a professional speaker, a radio personality, and the owner of The Oaks Firm, which is the premiere loan modifications & strategic default law firm in the Atlanta area. Other practice areas include foreclosure defense, principal balance restructuring, landlord-tenant law and more. The Oaks Firm will soon be offering seminars, workshops, webinars, DVDs and other products to educate and empower the masses through this national housing crisis. Please go to to learn more about our services. Attorney Oaks can be heard from 10am – 12 pm EST every Monday, Wednesday, and Friday on her hit internet radio show, The Misty Oaks Experience on You can also read her blog Mutterings of A Mastermind at She is on Facebook and Twitter at: Who Is Misty Oaks?

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1 had something to say.
  1. Reggie Swindell

    Lots of great information in this one! Thanks.


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