New “Flex Modification” Loan Modification Program Begins in October 2017

flex loan modificationA new loan modification program, called the Flex Modification, will officially be available to homeowners beginning October 1, 2017. Some mortgage servicers have already been offering the Flex Modification.

This program supersedes the Home Affordable Modification Program that ended at the end of 2016, as well as the Standard Modification and Streamlined Modification programs.

The Flex Modification is available to homeowners whose mortgages are owner by Fannie Mae and Freddie Mac. This encompasses roughly 3 in every 5 mortgages, the majority of home loans.

You can check if your mortgage is owned by Fannie Mae at the Fannie Mae: Know Your Options website. And you can check if your mortgage is owned by Freddie Mac with the Freddie Mac Loan Look-Up Tool.

The Flex Modification reduces payments to 40% or less of the homeowner’s monthly gross income through a combination of steps called the loan modification Waterfall. This includes reducing the interest rate, extending the mortgage term, and forbearing (but not forgiving) part of the principal balance. Arrears also will not be forgiven.

Despite reforms since the mortgage meltdown a few years ago, it is still expected that homeowners trying to modify their mortgages with the Flex Modification will encounter some of the same issues with lost documentation, wrongful denials, and other unfair business practices. Consumers in Massachusetts may have a remedy for these under the Consumer Protection Act, called Chapter 93A.

Culik Law is a Boston, Massachusetts consumer protection law firm. Our attorney have helped hundreds of Massachusetts homeowners with their mortgage problems. Contact us to see if we can help you.

Josef Culik

Josef Culik

Attorney Joe Culik has built his reputation on helping people and has dedicated his practice in Boston, Massachusetts to consumer protection, employee rights, and individual personal injury. He has advocated for individuals against some of the largest companies in America and has a passion for helping people uphold their rights against impossible odds. He has filed both individual and class-action lawsuits against most of the major banks, against some of the biggest debt collectors and credit reporting agencies, as well as insurance companies and corporate employers. Contact Joe