Here’s a happy client story from Senior Housing Counselor and Compliance Officer, Shelley Doran. The Foreclosure Fairness Act mediation program is a very strong tool for struggling homeowners, as you’ll see below:
“Mr. G. is very ill, has some dementia and had a massive stroke and is now confined to a wheelchair. Mrs. G. works full time and is his caregiver. Any discussion of moving out of the family home was not possible given Mr. G’s grave health.
The investor on the couple’s mortgage is Fannie Mae, and Fannie Mae has a no exception policy to their 20% equity guideline. If you have more than 20% equity you will not get a modification.
We went to mediation and the lender denied them due to having more than 20% equity. At mediation the lender provided an appraisal of 650K. After doing quick math I realized what the clients owed versus the 650K appraisal put them just 7% over the threshold of approval. I asked for another mediation session, and for a new appraisal be conducted, because the one the lender used was pre-Covid. The clients agreed to provide and pay for their own appraisal. Now we would have two appraisals being done, and hopefully the client’s would arrive at a less biased value.
We provided new documents and both appraisals, The client’s came in at 600K and the lender’s came in at 650K.
However, the lender only considered their own appraisal at 650K and denied our clients once again. I appealed the denial and disputed the appraisal. In disputing the appraisal, I provided appraiser guidance on adjustments that were used and proved that the appraiser “pushed” the value so the lender could deny the couple a modification based off of Fannie Mae’s 20% equity guidelines.
The lender agreed with my appeal and approved my clients for a home loan modification, saving them $200 a month. Mrs. G. was literally overcome with emotion, she was so grateful. Prior to entering into mediation, the couple had been denied a modification 2 previous times.
Without the FFA mediation program, these clients would have most assuredly lost their home.”