In the majority of cases, the company attempting to do a loan modification does not actually possess your mortgage documents. This is actually a fairly complex situation since I deals with securitization, and the fact that your loan appears to have been securitized - meaning it was sold to investors and the Bank no longer possesses it.
Consider yourself lucky though that they DIDN'T approve it. Far too many "Pretender Lenders" have popped up over the past few years who go through with these loan modifications, take homeowners money, all the while the real Lender hasn't been paid and files foreclosure on the property.
Hope your situation has improved!