By Alan White
Today Treasury released the October monthly report on the Home Affordable modification program. Once again Treasury gives us only the good news - 650,000 temporary 3-month payment plans with homeowners since the program started in April. By now, we should be seeing significant numbers of permanent modifications, but Treasury again refuses to divulge this key data. I am hearing that the conversion of temporary modifications to permanent ones is still appallingly low. We the taxpayers have contracted to pay the servicers billions of dollars to prevent foreclosures and modify loans, and so far they are not doing the job. It will not do at this point to keep pointing the finger at homeowners, hundreds of thousands of whom are entering payment plans and making payments.
There are also early indications that two-thirds to three-quarters of homeowners on temporary modifications have made all their payments, but fewer than one in a hundred has a permanent modification after three months. In some cases, legal aid lawyers are going to court to stop foreclosure sales for homeowners who are making payments on a temporary modification plan. Treasury needs to demand performance from BankofAmerica, Chase, Citi, Wells Fargo, and the other mortgage servicers who are slated to receive billions in HAMP subsidies (not to mention all the other TARP subsidies). Treasury also needs to start reporting the temporary-to-permanent conversion rate, and the homeowner default rate on temporary modifications. If this emperor has no clothes, then let's get the tailor working on a new outfit.
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Posted by: Debt Help TN | Wednesday, November 11, 2009 at 04:19 PM