I have found GMAC to be reasonable to work with in some cases, very inflexible in others.

In one case I was able to negotiate a $10,000 payoff on a $120,000 second mortgage. This was an underwater property, with little equity available to secure the second mortgage.

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Another case did not go so well. The client came to me with only a few weeks remaining before foreclosure. I submitted a complete package, however, GMAC refused to call off the foreclosure until the lender gave its approval. The foreclosure date arrived and GMAC had still not agreed to extend the foreclosure date. To save the property I put the client into Chapter 13 bankruptcy. A week later the client decided the property was so far underwater that he just wanted to give up. So I canceled the Chapter 13, the client made no payments, and GMAC foreclosed.

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VZ is a hardwood floor layer and general contractor. His business tanked when the Great Recession set in. He got behind on his home mortgage.  Payments were high at 7.8%. However, in 2010 his income was recovering. His income turned out to be a little too high for him to qualify for the Making Home Affordable program, however, I was able to work out an in-house modification at 4.5%.

As the months have gone by, all the lenders have learned the rules of the road and are behaving more reasonably, GMAC included.

In 2012 VZ’s income had dropped. We played with the figures and decided that we should make another try to get him a Making Home Affordable modification. Success! On his $350,000 loan, he has principal and interest payments of $1,219.40, escrow payments of $555.58 and total payments of $1,774.98. He will get his modification as long as he pays three trial payments. There will be no further review of his income. The Trial Payment Plan, aka TPP, does not make it clear what the interest rate is or whether there is a principal reduction or principal forbearance. We will not know the exact terms until the final modification papers come through. Assuming that there is no principal reduction or forbearance, VZ’s interest rate is 2.0% and his loan amortizes over 390 months.

Working with self employed people sometimes involves picking the right time to apply.

VZ’s total payment dropped from $2,413.27 to $1,774.98, a reduction of $638.29.

VZ is very happy.