Citi mortgage aid procedures

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Editor’s note: Citi declined to answer Bankrate’s questions, asking instead that borrowers call Citi directly. They also referred Bankrate to a report on their Web site titled “Citi U.S. Mortgage Lending Data and Foreclosure Prevention Efforts.” Bankrate consulted the document and found answers to as many of the questions as possible. We have reported them here.

Bankrate asked 10 top lenders
Bank of America, Chase, Citigroup, Countrywide, IndyMac, National City, Residential Capital (GMAC), Wachovia, WaMu and Wells Fargo — to outline their procedures for helping struggling borrowers save their homes.

What is the first thing borrowers should do if they are at risk of missing a payment?

Distressed borrowers should contact Citi at one of the following numbers:

  • CitiMortgage: (866) 272-4749.
  • Citi Residential Lending: (800) 211-6926 or (800) 430-5262.

When should borrowers call you — before they’re late with their first payment, or sometime later on (e.g., 60 to 90 days after missing the first payment)?
Citi declined to answer.

Should a borrower ask to speak with someone specific?
Citi declined to answer.

What information should borrowers have available when they call?
Citi declined to answer.

What types of solutions might be available to borrowers?
Citi’s loss mitigation efforts fall into two major categories:

  1. Those with outcomes that lead to home retention, such as loan extensions, modifications, repayment plans and reinstatements.
  2. Those with outcomes that result in the homeowner surrendering possession of the home without foreclosure, such as short sales and deeds in lieu of foreclosure.

Loss mitigation efforts include:

Modification agreement. Typically used when the customer has a significant reduction of income that impacts his or her ability to pay and will last past the foreseeable future. Typically, the customer’s loan terms are modified in order to resolve the mortgage delinquency. This agreement makes the mortgage more affordable for the customer.

Repayment plan. A written agreement between the borrower and the lender to implement a payment moratorium due to unforeseen circumstances wherein the property or employment status is affected. At the expiration of the term, the customer pays the total arrearage in a lump sum payment or elects a further repayment plan. This agreement is typically used when a customer has a short-term reduction of income that severely impacts his or her ability to pay for a short period of time. The repayment plan brings the customer current over time as the payment obligations are met. It can also include a repayment plan under which the customer pays the regular monthly payment and an additional amount each month to catch up delinquent payments over time.

Short sale. Occurs when the customer does not have either the desire or ability to keep the property and is willing to sell the property to satisfy the debt. This option is utilized when the amount owed less acceptable closing costs to sell the property is more than the value of the property.

Deed in lieu of foreclosure. Occurs when the customer does not have either the desire or the ability to keep the property and is unable or unwilling to sell the property but is willing to sign the property over to Citi in exchange for stopping the foreclosure action. Deeds in lieu of foreclosure are generally accepted only after all other options have been exhausted.

Extension. Occurs when the customer has experienced a temporary hardship and is unable to bring the loan current. The customer has the ability to continue making future payments, but does not have the funds to completely reinstate the loan. An extension may re-amortize the loan or defer the interest to the back of the loan. It brings the customer’s account current immediately. An extension is generally used in the early stages of delinquency when a customer is one or two payments behind; it is rarely used for serious delinquency of more than 90 days past due or in the foreclosure process.

Reinstatement. Occurs when a customer that is 90-plus days past due is able to pay all of the delinquent fees, interest and principal owed to the bank with a single payment. This brings the customer’s account current immediately and allows him or her to continue to pay off the loan according to the original amortization schedule.

Do you accept partial payments?
Citi declined to answer.

What percentage of borrowers can expect to get some type of workout of their mortgage?
Overall, in the fourth quarter of 2007, borrowers serviced by Citi who received extensions, modifications, reinstatements or repayment plans outnumbered those who were foreclosed by almost five to one.

Are there any fees involved in the workout process?
Citi declined to answer.

Does the process differ depending on whether you are a borrower who is missing a regular payment or a borrower whose mortgage is about to reset?
Citi declined to answer.

Find your lender
1. Bank of America 6. National City
2. Chase 7. Wachovia
3. Citigroup 8. WaMu
4. Countrywide 9. Wells Fargo
5. IndyMac

Is it helpful if they contact a credit counselor who can work with you on the process?
To ensure that services are available to all who need them, Citi supports foreclosure prevention and education programs within various national and local counseling agencies. Partnership organizations include the Association of Community Organizations for Reform Now (ACORN), Neighborhood Assistance Corp. of America (NACA), Consumer Credit Counseling Service (CCCS), Consumer Counseling Resource Center (CCRC) and other community-based organizations.

How did it go? Tell us about your experience using this information to work out a solution with your lender.