The LMM program streamlines the modification process and pulls the banks within the purview of the federal bankruptcy courts. In the LMM program all document submission occurs online, in an electronic system known as a portal. Here the chapter 13 debtor and lender facilitate the modification process by electronically logging all documents being sent from the debtor to the lender to be used for a modification.
The guidelines for the LMM program require responses from the lender within 7 days of receiving the documents on the portal. Within 7 days the lender must advise the debtor whether the modification package is ready for review or whether additional documentation is necessary. Should the lender require additional documentation, the debtor has the same 7 day time frame to supply the required information. This process eliminates modification denials for lack of documents or insufficient documents.
The LMM program guarantees an individual a fair review of their modification package and requires the bank provide a detailed response. Should the bank decide to deny the modification, a specific reason for the denial must be listed to ensure all information used was accurate and to provide sufficient time for the debtor to appeal the decision.