Nothing worth having is given away. When you want something of value, it usually takes some work to get it. So when you apply for a home-saving loan modification to avoid foreclosure and have a lower mortgage payment, don't expect the process to be easy.
To get a loan modification, which is a permanent change to one or more of the terms of a mortgage, you have to complete a request for mortgage assistance (RMA). It's a thorough application requiring documentation of income, a debt to income ratio, a hardship affidavit, and more.
The loan modification application must be filed with your loan servicer, and one of the largest mortgage servicers in the country is Ocwen Financial Corporation. Although Ocwen actually has a reputation as one of the better loan servicers to work with when trying to get a loan mod, it's still challenging.
Here are some common complaints of homeowners trying to work with Ocwen for a loan modification:
1. Dealing With Customer Service in India
If you call Ocwen yourself, you'll likely reach someone at their call center in India. The customer service representatives there may be very polite and well-trained, but people say they don't like dealing with someone on the other side of the world who speaks English as a second language when they're trying to find a solution to keep their home.
When we speak with Ocwen on behalf of our clients, we don't always deal with customer service overseas. We try to work with their loss mitigation department in West Palm Beach, Florida. Which would you prefer?
2. Sending in Documents Multiple Times
The documents you submit in your RMA are not valid forever. Some of them are only good for a couple months, and while your application is under review, they can expire. You have to keep submitting bank statements and pay stubs to keep your application up to date.
The hassle of submitting the same documents over and over again is one of the most common complaints for homeowners trying to get a loan modification with Ocwen and other servicers.
3. Being Denied a Loan Modification
Most homeowners who apply for a loan modification on their own are denied. It can be difficult to show that your income is in the “Goldilocks zone,” where it's not so low that it looks like you can't afford the mortgage and not so high that it looks like you don't need assistance.
Getting denied is devastating because the borrower's only hope of keeping their home is through a loan modification. Failure means you might go through foreclosure or lose the home some other way, such as through a deed in lieu of foreclosure or short sale.
As servicer of so many mortgages across all 50 states, many of them subprime and in need of modifying, Ocwen has done a whole lot of denying loan modification applications.
Ocwen also has a history of failing to comply with terms of the National Mortgage Settlement. In April of 2016, those failures forced Ocwen to be forbidden from taking foreclosure action on more than 17,000 homeowners. More recently Ocwen has failed to comply with performance metrics related to force-placed insurance.
Avoiding Problems With Ocwen Loan Modifications
You can avoid many of the headaches associated with trying to get a loan modification and maximize your odds of getting approved by hiring an experienced professional to help you. Look for someone with a proven record of success with your servicer that charges a fair fee for their services before you give them a dime.
Read More: What is an Ocwen SAM Modification?