Chase Is Now Surprising People With Mortgage Adjustments

While we’ve seen many a story during the last few years of people stuck chasing their tail in an attempt to get a mortgage modification from their lender, some Chase customers are now finding out they’ve gotten a loan adjustment without ever having to lift a finger.

It all goes back to February’s $25 billion settlement between the states and the nation’s largest lenders.

Chase agreed to $4.2 billion in mortgage relief for affected customers. So at first the bank attempted to contact people who could possibly be eligible, but only received responses from about half of them.

And since the settlement rewards lenders who complete these adjustments within one year, Chase decided not to wait for everyone.

A rep for the bank tells CNN Money that it identified customers who fit the criteria — loan held only by Chase and not backed by either Freddie Mac or Fannie Mae; delinquent on payments and/or with a home worth significantly less than the remaining value of the loan — and simply notified them of their new, lower interest rates. All the borrower has to do is sign.

CNN talks to one Washington state couple who had been in danger of losing their house when they received a FedEx-ed document from Chase letting them know the interest rate on their mortgage had been slashed from 6.5% to 2.8% for the next five years, followed by an increase to 3.9% for the remaining 18 years left on the loan.

In all this, cut their monthly payments by $229 and has allowed them to keep the house.

Quips the homeowner, “I’ve stopped buying lottery tickets.”

To quote Consumerist reader Trireme32, “Banks doing the right thing?? Is this a sign of the apocalypse?”

Surprise! Chase Is Refinancing Your Mortgage [CNN Money]

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  1. Coelacanth says:

    I don’t have a mortgage, Chase, but could you send me a kitten instead? :)

  2. AustinTXProgrammer says:

    Define significantly less… Am I going to miss out once again because I bought within my means and have never missed a payment?

    • MathMan aka Random Talker says:

      Probably! Damn you and your responsibleness. You probably rented at a cheap place for a while to save up several months of emergency funds and then saved a down payment that was 20%+ to avoide mortgage insurance. You did didn’t you!

      • AustinTXProgrammer says:

        I wish I had done it that well, but I did extensive research and found out that a USDA guaranteed loan was the cheapest at the time. I paid 2.25% upfront and never have PMI. Chase funded and services the loan, although I don’t know if it’s even possible to know if they sold it off to investors.

        I now make too much money to refinance with the USDA program and I’m starting from scratch with anyone else. I do not have 20% equity driving up the cost of refinancing.

    • sufreak says:

      Its been my gripe with this whole fiasco. I bought a reasonably priced place I could afford. Paid on time, every time, and even extra sometimes.
      So when I want a lower rate, I need to re-fi with closing costs.

      Or option B. Buy over my head, miss payments. Then either walk away or get a lower rate for free. Who is the real sucker?

    • Willow16 says:

      Have you checked with your bank to see if they offer modifications? We just refinanced with a home equity loan in May and were told that if interest rates went down we could modify to the new interest rate for a $200 fee. We got 3.99% and the 15 year rate is now 3.625%. We would recoup the $200 in less than a year. I would like to see if it goes down further but will likely modify it soon.

  3. TuxthePenguin says:

    Part of me is happy, but part of me is furious that those who are keeping up aren’t being rewarded… I can go through my list of clients and find two or three who are doing everything they can to stay current on their debt… and they won’t be eligible for this. Sad, seems the better advice would have been for them to stop making payments and hope for the best.

    And the fact that this lady was playing the lottery… sickening. Lotto is also known as the Stupid Tax.

    • crispyduck13 says:

      Yeah, I bought a house a year and a half ago within my budget and never miss a payment. I mean damn Metlife, at least send me some cookies or something.

    • Loias supports harsher punishments against corporations says:

      Depends on how much you spent.

      Is $2/month really deserving of ridicule?

  4. Blueskylaw says:

    “And since the settlement rewards lenders who
    complete these adjustments within one year”

    So once again, banks go out of their way to help you
    only if it benefits them financially in some way. Got it !

    • crispyduck13 says:

      I expect nothing more.

    • Gambrinus says:

      Pretty much any mortgage modification will look at an NPV test to see whether they stand to make more money by lowering the payment or by foreclosing. The idea is that by lowering the payment they get borrowers paying again and ultimately make more money; foreclosure tends to involve a big loss to the investors. There’s a reason why workouts are handled by the “Loss Mitigation” departments at the servicers.

  5. Press1forDialTone says:

    A good thing, but in my view, too late to repair the image damage
    to the private banking industry. The bottom line is: The investors WILL
    be served first and that means the motive it profit at all costs including
    as we have seen, risky investments (Jamie Dimon of Chase) that tanked
    costing billions. Until the retail and investment arms of the banking industry
    are once again separated by the Fed, yes, re-regulated, abuse will be rampant.
    The private banking industry has proven with the creation of a near depression
    during the Bush admin, that Obama is helping us to crawl out of, that it -cannot-
    and -will not- regulate itself. There are a number of other private industries
    that have demonstrated this as well.

  6. Loias supports harsher punishments against corporations says:

    Now, while I applaud Chase’s efforts here, the thought does occur to me.

    Perhaps these people not responding is simply a sign of their overall irresponsibility.

    • AustinTXProgrammer says:

      Or how about all the rampant fraud? If Chase sent me a letter that they were dropping my rate I would be hesitant to call the number. There are a lot of people ripping off desperate mortgage holders.

      • lyontaymer30 says:

        Smart consumers would actually call their company and ask. And if it is a scam, many companies can actually do something about it as the process is defrauding them and of course they would want to clear that up.

      • Saltillopunk says:

        I have been getting such letters from Chase. Originally it was sneaky in that it hid the fact that they are offering a refi and not a rate drop. Later letters are slightly less obtuse about the fact it is a refinance. For me, it is a sick joke because they really think I am stupid enough to re-up for 30 years when I have only 15 left to go.

    • lyontaymer30 says:

      And I bet a good chunk of those people that don’t respond would have been calling 6 months, 1 year, 5 years saying the company doesn’t help them lol. It’s pathetic that the company had to actually go out and initiate the process for them lol.

  7. jp7570-1 says:

    Too good to be true. Somehow, our financial institutions will figure out how to muck this up.

  8. Lyn Torden says:

    So what do those of us who stayed current on our mortgage payments get? Oh wait … we get to subsidize those who didn’t.

    • MathMan aka Random Talker says:

      DING DING DING!

    • MathMan aka Random Talker says:

      Oh and it’s the same for health care premiums… but don’t get me started…

    • dolemite says:

      I’m refinancing now. I asked if I could get some kind of cheaper refinance or streamlined. They said maybe. They looked it up and said if I had gotten my mortgage a month earlier I would qualify for some kind of government approved refinance, but since I was 30 days too late to quality, I had to pay the $2800 to refinance. Awesome.

  9. BlueTomato says:

    And what about those of us whose mortgages are SERVICED by Chase but OWNED by Ginnie Mae? We’ve been left out of every single mortgage relief effort so far. Every.Damn.One.

  10. Happytobealive says:

    And perhaps before jumping to judge, one should consider there may be circumstances beyond people’s controls that affect their ability to make the payments they committed to such as the pesky cancer diagnosis that side-swiped me. Numerous surgeries, chemo, radiation….I can’t work and disability is not the same as a paycheck. Not to mention the mounting medical bills (even WITH medical insurance). So we fell behind in our mortgage payments, Chase worked with us and we are grateful. Imagine dealing with a rare & aggressive cancer AND not knowing if you’ll have a roof over your head. So if you consider that irresponsible, I consider you heartless.

  11. YouDidWhatNow? says:

    “To quote Consumerist reader Trireme32, “Banks doing the right thing?? Is this a sign of the apocalypse?””

    “And since the settlement rewards lenders who complete these adjustments within one year, Chase decided not to wait for everyone.”

    No.

  12. CrazyEyed says:

    Am I the only one who found the comical irony in the person advising they were excited to be able to afford their mortgage yet had enough for lottery tickets?

    • dpeters11 says:

      There is also the possibility that it was a joke. Plus, if someone spends $2-$4 a year on lotto tickets when it’s really big, it really doesn’t make much difference in paying a mortgage.

  13. absherlock says:

    Chase came to us last year and offered, out of the blue, a remortgage. We went from 7 years left at 6.5 fixed to 10 years at 3.85 fixed and they paid all costs. It seemed so odd that we almost didn’t do it, fearing a scam.

  14. kalanit says:

    Yeeeaaaaa! I got home today and found one of the magic FedEx letters. And get this…its from BANK OF AMERICA!!! Now, I’m worried because I’ve never been late on my mortgage. Does that mean I’m not eligible?

  15. Dirk Daring says:

    “Quips the homeowner, “I’ve stopped buying lottery tickets.”

    It’s not wonder stupid people fall behind on payments.

  16. padarjohn says:

    I got one of the Chase offers. I’ve never been behind, and I’m far from underwater. It restarted the 30-year period, but I had just refinanced a couple of years ago, so that didn’t matter much.

    No points, no fees, no appraisal. Just sign the papers and monthly payment dropped by ~$100/mo.

    I was suspicious, but checked it thoroughly. I figured there was a government kickback for them.

  17. TravistyRobertoson says:

    If I got a package I would hold out until the last minute and try and negotiate a better deal. If you were the last one holding up a big financial gain for the company, I bet you could get an even lower rate.