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Posted: Sun Dec 20, 2009 6:39 am Post subject: Can loan mod include late fees?

From HUD FAQ's:

Question 3: Can a mortgagee include late charges in the Loan Modification?

Answer: Mortgagee Letter 2008-21 states that accrued late charges should be waived by the mortgagee at the time of the Loan Modification.

My loan docs include late fees. Also, during the time waiting for my loan mod papers to be drawn up I've been making monthly payments - they have used some of my money to pay for late fees.

Have they violated some laws here?

UMAR_MUGHAL76 · Joined: 20 Oct 2009 Posts: 11 2.62 Dollars($)

HI
Mortgagee Letter 2008-21 states that accrued late charges should be waived by the mortgagee at the time of the Loan Modification.

REGARDS

Posted: Sun Dec 20, 2009 3:21 pm Post subject:

Thanks, but what does that mean? To me "waived" means "excused". Should I have not been made to pay the late fees at all?

adonis · Posted: Sun Dec 20, 2009 8:36 pm Post subject:

Hi Guest,

As per what you've quoted from HUD's FAQ, it means that the late fees have been forgiven or excused. If your lender is charging so, then I don't think it would be considered as legal. I would suggest you to contact a lawyer who is an expert in loan modification laws and get his opinion in this regard.

gmakerley · Posted: Sun Dec 20, 2009 9:20 pm Post subject:

anytime something "should" be done, that means, to me, that there's a gray area. they should waive late charges, but if they choose not to, that's okay. they should quit smoking, but we can't make them do so.

there's a similarity there. i don't know the thoughts of the committee that put together letter 2008-21, but it seems they gave lenders a choice. though it's kind of dirty dealing to exercise that choice, i don't know that there are any remedies.

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Can loan mod include late fees?