What we have seen is that the lender/servicer adds to the back end, as a balloon, principal so that the new payment is fully amortized based upon the amount of principal to be paid if the loan is paid to term, with the balance due as a balloon. It is really a slight of hand, as there is no net benefit to the borrower. If the borrower intends to sell the property at any time the balloon must be paid, with the same result upon a refinance.
Look over the modification loan documents to see if that is the case for your client. Also, California law requires that loan documents must be presented to the borrower in their native language if English is not their first language. Korean is one of the languages included in a statutory list. Don't be surprised if BAC argues that because they are a NA that they are exempt from California law.
Lou Esbin
>
> Another attorney told me that a similar thing happened to one of his
> clients.
>
> On Wed, Dec 16, 2009 at 3:13 PM, Shannon Doyle wrote:
>
> >
> >
> > Wow that sounds extremely heinous.
> >
> > Shannon A. Doyle, Esq.
> >
> > Borowitz, Lozano & Clark, LLP
> >
> > 100 N. Barranca Ave., Ste. 250
> >
> > West Covina, CA 91791-1600
> >
> > (626) 332-8600 Phone
> >
> > (626) 332-8644 Fax
> >
> > sdoyle@...
> >
> >
> > ------------------------------
> >
> > *From:*
cdcbaa@yahoogroups.com [mailto:
cdcbaa@yahoogroups.com] *On Behalf
> > Of *Daniela Romero
> > *Sent:* Monday, December 14, 2009 10:20 PM
> > *To:* CDCBAA
> > *Subject:* [cdcbaa] BofA added 94k to principal in loan mod that client
> > obtained
> >
> >
> >
> >
> >
> > Approximately 9 months ago Client, without anyone's assistance, obtained
> > loan modification through BofA (Countrywide loan). However, BofA added 94k
> > to the principal. Client states she didn't really understand what was going
> > on and she only dealt with a BofA rep on the phone. English is her 2nd
> > language and nothing was explained or translated to her native language,
> > which is Korean. She has a very heavy accent and even though she
> > understands English and can communicate in English, it's obvious that she
> > should have at least had a translator since everything was done over the
> > phone.
> >
> > I wrote BofA a letter demanding that they modify her loan again because the
> > 1st modification didn't comply with the terms of Countrywide's settlement
> > agreement with the Ca. State Attorney General. They have agreed to revisit
> > the modification, but I'd like your opinion about what to do if BofA refuses
> > to remove the 94k they added to the principal. [I don't know, but for some
> > reason I don't think they are going to willingly remove any portion of this
> > 94k.]
> >
> > Client had some arrears---but not even close to 15k, so I don't know why
> > they would add 94k to the loan. She now owes about 790k and FMV of property
> > is appx. 590k. This is an income property; she also runs a preschool (sole
> > proprietorship) at this property and she resides there too.
> >
> > She had back surgery last year and has about 24k in outstanding medical
> > bills; she also has some personal credit card debt.
> >
> > Any ideas on how to handle this 94k would be appreciated.
> >
> > Thanks,
> >
> > Happy Holidays!
> >
> > Daniela P. Romero
> > Law Office of Daniela Romero, APLC
> > 1015 N. Lake Ave., Ste. 115
> > Pasadena, CA 91104
> > Telephone:626-817-2611
> > Facsimile: 626-628-1781
> > email: dromerolaw@...
> >
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> >
> >
>
>
>
> --
> Daniela P. Romero
> Law Office of Daniela Romero, APLC
> 1015 N. Lake Ave., Ste. 115
> Pasadena, CA 91104
> Telephone:626-817-2611
> Facsimile: 626-628-1781
> email: dromerolaw@...
>
> NOTICE: This E-mail (including attachments) is covered by the Electronic
> Communications Privacy Act, 18 U.S.C. 2510-2521. The information herein
> is confidential, privileged & exempt from disclosure under applicable law.
> This E-mail (including attachments) are intended solely for the use of the
> addressee hereof. If you are not the intended recipient of this message,
> you are prohibited from reading, disclosing, reproducing, distributing,
> disseminating, or otherwise using this transmission. The originator of this
> e-mail and its affiliates do not represent, warrant or guarantee that the
> integrity of this communication has been maintained or that this
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> recipient is not intended to waive any right or privilege. If you have
> received this message in error, please promptly notify the sender by e-mail
> and immediately delete this message.
>
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The post was migrated from Yahoo.