As millions of homeowners struggle to make their mortgage payments, a loan modification may be their last option in order to avoid foreclosure. But a successful modification isn’t guaranteed. Out of the 4 million people who have applied for a loan modification since 2010, through the government’s Home Affordable Modification Program, one million of them have been denied for inaccurately filling out the paperwork, according to the U.S. Treasury Department.
Dedicated to fixing the problems in the loan modification industry, Stephfan Nurse, CEO and founder of ConsumerEducationOnline.com, is focused on leveling the playing field by putting the power in the hands of the homeowner, and using education and software to help simplify the modification process.
BLACK ENTERPRISE spoke with Nurse about the problems in the modification industry and how his company has been providing solutions to help homeowners.
BLACK ENTERPRISE: What made you start ConsumerEducationOnline.com?
Nurse: After being in the loan modification industry since its inception, I realized a major problem with the industry where homeowners did not receive accurate and consistent information about modifications. It seemed the only information available was surface-level education that only re-directed people to contacting a third party such as bogus credit counseling companies. In early 2010, I decided to create a website that guided homeowners throughout the entire process, providing practical education and online tools that they could immediately apply removing all of the jargon and fluff.
What kind of online tools do you provide?
We developed the first and only loan modification pre-qualifier on the Internet. This online tool allows anyone to enter in their financials and know immediately if they qualify for the government’s Home Affordability Modification Program, or the lender’s traditional modification program. The traditional modification is the modification most people get approved for but most people are unaware of its existence.
What were some of the difficulties you encountered when starting your company?
It would have to be distinguishing our company from everyone else in the modification industry. Before recent legal changes, the industry was filled with many opportunists who wanted to take advantage of desperate homeowners. Justifiably, people became skeptical of anyone or anything that had to do with modifications. The Internet was filled with nothing more than capture pages used to gather information so they could resell it back to companies promising modification assistance. However, I am confident we have real solutions, and overtime, the results will speak for themselves.
Why are homeowners having so much trouble getting approved for a loan modification?
The number one difficulty homeowners are facing in being approved for a loan modification is filling out the paperwork correctly. According to the U.S Treasury Department, out of the 4 million people who have applied for a loan modification since 2010, 1 million of them have been denied for inaccurately filling out the paperwork.
What common mistakes do homeowners make when completing a modification application?
Homeowners usually do one of two things when filling out the financials section of the Uniform Borrower Assistance Form. Some will say, “Let me show the lender that I am really in the negative,” overstating their debt, which results in them only qualifying for a forbearance, short sale, or deed in lieu. Other homeowners will fail to input 100% of their correct income according to what is on their paystubs. As a result, they might get approved for a temporary modification but will be denied for a permanent modification once their lender verifies their paystubs, even if it was off by as little as $30.