[Will661]

Hello,
I am purchasing a home in California, and due to a change in income I filed for a loan modification with my mortgage company. My mortgage company would not allow me to obtain a loan modification because I was up to date on my payments. I informed them of my situation and of my lower income and explained that I would not be able to stay up to date on my payments, especially since I was in an adjustable rate mortgage and my mortgage was scheduled to increase for the third time. The representative from the mortgage company informed me that they were only working with those people who have already fallen behind on their payments, and stated that they could not help me until I missed at least 3 payments. I informed the representative that I had outstanding credit and I did not want to miss any payments, but that I only wanted a modified payment amount. To make a long story short the mortgage company had the upper hand and I had to comply by missing 3 mortgage payments. After missing 3 payments I called repeatedly called the loan modification department of my mortgage company weekly for about 3 more months, leaving messages and never receiving any return calls. Eventually I received a letter stating my home was going to be put up for foreclosure, if I did not contact them to resolve the delinquency on my account.

I called and complained to every representative that would listen and explained to them that I know they have to document every time I call in the computer, so I asked them did they notice how many times I called trying to resolve my issue, and how many times I was transferred to loan modification and told they would call me back. Finally, I got a representative who was sympathetic to my situation and connected to someone in the loss mitigation department in order to get my loan modification going. I started this whole process June 2008 and finally got a loan modification agreement signed and active as of January 2009. My mortgage payment was adjusted, I was able to continue making my adjusted payments on time and everything was fine up until June of 2009. This is when I received a mortgage statement requesting more than our agreed upon amount stated in the loan modification agreement. I began calling customer service and was first informed that my loan interest rate was increased. I explained to the rep that I had a signed loan modification agreement that stated my payment amount could not increase for five years.
The rep placed me on hold while he checked this out and then he returned and apologized for the mistake, and informed me my modified mortgage payment is the correct amount and he stated that they will correct the mistake within a week. The rep informed me that my next statement would be correct showing the modified payment.
Well the reason I am here asking for help is because every month since June 2009, my mortgage statement has still not been corrected, and every month like clockwork I call and speak with 2 departments. Customer service department first states that I am behind on my payments, and then I explain that I have a current loan modification agreement, then they place me on hold and state that they see that in the computer, and lastly they transfer me to loan modification stating that loan modification needs to update the file. I then explain the situation to the Loan modification department and they ensure me that my modification agreement is current and they inform me to continue to pay the agreed upon amount. This is my third month of dealing with this continuous confusing cycle and it is causing a great deal of stress for me and my family, so much that it is truly causing sickness and depression. The fact is I am making all my payments as agreed upon but my mortgage statement is not crediting these payments to my account. I just received another statement stating I am 3 months behind on my mortgage and that once again if this is not resolved my account could soon be referred to foreclosure.

My wife and I are at our wits end and I need to know is there anything I can do?
Is this default of a loan modification agreement by my mortgage company?
Is there any legal action that we can take?

[ScottGem]

The best suggestion I can make is to contact the California State Banking agency and see if they can help you get this straightened out. Make sure you keep copies of all your payments.

If they do start foreclosure there will be a hearing and you can present your evidence to the court that you have an agreement and have been paying according to that agreement.

[Will661]

Hello ScottGem ,
Thank you for your help and quick response. I will give your suggestion a try, and I will post later to inform of the outcome.