This Bank offered us a loan modification. Great, but what are the terms?

This bank recently offered us a loan modification (after years of purported default) on one of our Suffolk County cases – all we have to do is make three (3) monthly trial payments and the foreclosure goes away. Great, right?

No. Hell no. Many desperate homeowners facing foreclosure would jump on this and make the trial payments to save their home, but unknowingly, dig themselves in a much deeper hole.

This bank’s single-page settlement offer is incredibly deficient. I can’t tell my client what we’re agreeing to, because… the bank hasn’t told us what we’re agreeing to. Other than the monthly amount, what are the new terms?

What is the new interest rate(s) and maturity date? But most importantly, what is the new unpaid principal balance? What amounts are being capitalized? How much in alleged, “interest,” “advances,” “legal fees,” “late charges,” and other purported fees are being added to the modified amount (that we will be responsible for)? Are the numbers even accurate? Is there a deferred/balloon payment? Please, tell us more! Because we’re not being pressured into this agreement even with the “time is of the essence” language without first reviewing the additional terms – no one should.

In any settlement negotiation, you need to review a breakdown of all the numbers (if applicable) in order to make an intelligent decision (that may bind you for 30-40 years). In foreclosure actions, having a breakdown of the numbers also puts you in a better bargaining position to try to make the settlement more affordable. When legitimate defenses are interposed, the bank is more willing to waive late penalties, legal fees, interest and other charges. You can’t negotiate the numbers without seeing the numbers. Show us the numbers!