Chase Loan Modification Re-Default Rate Stands At 90 Percent
A lot of distressed people continue to wait for that pot of gold at the end of the rainbow, otherwise known as a loan modification. People pay lawyers to fight for modifications, they haggle with the banks for two, sometimes three, years all in an effort to obtain a loan modification. Although people continue to fight for loan mods the plain fact is that they often do not work out.
Yesterday, we met with a knowledgeable VP at Chase who provided us with some interesting facts. We knew from previous numbers (see our previous post) that many homeowners re-default on their loan modifications. Our Chase contact told us that 90 percent of Chase loan modification homeowners end up re-defaulting. We had seen numbers as high as 50 percent for re-default rates but we had not heard 90 percent until now. Time for homeowners to truly consider the what a loan modification entails. It may be better to seek another option like the Chase short sale incentive program where homeowners can receive up to $45,000.
Chase Homeowners Who Are 60 Days Late Or More – 1.1 Million
Although the distressed market continues to decline, many homeowners continue to have mortgage issues. For Chase loans, 5.8 percent of 1.1 million mortgage holders are 60 days late or more.
In all reality Chase has mostly improved its distressed property situation. According to our Chase contact, Chase attempts to reach out to distressed homeowners 121 times (phone, email, snail mail, etc.) and they now wait over 400 days to begin the actual foreclosure process. Some people need to due their own due diligence or just have a reality check but they need to do something and not play ostrich.
Chase deals with over 3100 mortgage investors so with that many investors, homeowners need to realize that the loan modification or short sale process may take some time. Be patient and consider various out of the box options.