Pummeled by complaints from borrowers, loan servicers commit to more mortgage modifications. White House wants 500,000 trial mods by Nov. 1.
NEW YORK (CNNMoney.com) -- Loan servicers will "significantly" increase the pace of mortgage modifications under the Obama foreclosure prevention program, the Treasury Department said Tuesday.
The Obama administration wants to see 500,000 trial modifications in place by Nov. 1. Currently, 200,000 are underway.
Officials called executives from 25 servicers participating in the program to Washington Tuesday to discuss improving the 5-month-old plan's implementation.
Both the Obama administration and the industry are feeling mounting pressure from borrowers who say their servicers are not responding to their calls and applications, losing their paperwork or not making decisions.
"[T]oo many homeowners are at risk of foreclosure right now," Treasury Secretary Tim Geithner said in a statement Tuesday. "Today's meeting was an opportunity to identify ways to accelerate the program and bring relief faster."
Announced in February, the loan modification plan allows eligible borrowers who are in or at risk of default to lower their monthly payments to no more than 31% of their pre-tax income through a loan modification. The adjustments are made permanent after the homeowner makes three on-time payments. Homeowners, servicers and mortgage investors receive incentive payments in hopes of increasing participation.
So far, the government has committed $20 billion to the effort and has said it would provide $75 billion overall.
Thank you for checking my blog out. If you or anyone you know have any questions about what the banks are offering in way of Mortgage Solutions. Please contact me at my office (562) 685-8159
Robert Vaughan
Vice President
No comments:
Post a Comment