The lender did not receive the documentation requested, or all the documents sought. The documentation was received, but it was blurry and could not be read. The documents were more than 90 days old, and new ones are needed.
"And, as always," Shaw said, "the final letter goes something like this: 'I'm sorry, but your financial position disqualifies you for a mortgage modification.' "
Carol Ackerman of Philadelphia has been going through similar difficulties since April 2009. She is disabled, can work only part time, and was laid off, losing the supplemental income that paid her mortgage.
She tried modifying her mortgage and says she was scammed by a lawyer promising a modification. By December 2009, after she had submitted documentation to the loan servicer seven times, her house was in foreclosure.
After learning in January 2010 that she was eligible for the government's Home Affordable Modification Program, she applied, was assigned a counselor, went to eight meetings - every one was continued - and had to resubmit documentation every 60 days.
Ackerman went to another counseling agency, submitted all the documentation again, and received a forbearance agreement from the loan servicer three months later, in November 2010.
In February, she was told to submit her documentation packet to the servicer, which then denied her modification. She attended another meeting with the servicer, and the case was again continued to a hearing set for June that never took place.
In the meantime, $36,000 has been added to her original loan, and the last I'd heard from Ackerman, the servicer was calling three to four times a day requesting the money before it would consider a modification.
Unlike Ackerman, too many homeowners bit off more mortgage than they could chew from the start, and for those people, Shaw says, "We need a call to reason."
Lenders originated loan products "too good to turn down, and they are the original cause of the real estate debacle," he said.
If it hadn't been for these loan products, "hundreds of thousands of consumers would not have had the opportunity to borrow and lose their homes," Shaw said.
He suggests that a simple fix would be for President Obama to draft an executive order that all mortgages that were subject to predatory-lending practices will now have an immediate new fixed rate of 4 percent for 40 years for whatever the homeowner owes to the bank.
The homeowner would sign a deed in lieu of foreclosure, and if he or she missed a payment, the lender would take the house back without costly legal procedures.
The homeowner would get an immediate fix without needing to provide all that documentation. The lender would not have to spend infinite employee hours on modifications or a fortune on the foreclosure process.
Ackerman's problem, though, is the result of losing a job, not being bamboozled into a mortgage she couldn't afford.
"I would consider Mr. Obama changing the name of his program to 'Take My Home,' " she said.
On the House:
Inquirer real estate writer Alan J. Heavens' home improvement column appears Fridays in Home & Design. See instructional videos at Al's Place. Go to philly.com/yourplace
"On the House" appears Sundays in The Inquirer. Contact Alan J. Heavens at 215-854-2472, firstname.lastname@example.org, or @alheavens on Twitter.