That’s the latest headline from a recent story in response to data released by the government on the success of their much lauded foreclosure prevention plan- Making Home Affordable.
If you have visited the site MakingHomeAffordable.gov you’ve probably even seen the slogan- “don’t pay, walk away..” and to “..beware of loan mod scams…”
With all the disinformation out there it’s hard to know who to trust. Well some would say trust the government, what agenda could they possibly have other than helping homeowners keep their homes. Well lets look at the data and revisit that question.
Approximately 9% of eligible borrowers have received trial modifications under the Obama administration’s ambitious effort to help struggling homeowners, according to data released by the Treasury Department at the end of August 09′.
Participating mortgage servicers, which receive hefty government payments for modifying loans, have had “uneven” success at rescuing borrowers, Treasury acknowledged, as a wave of foreclosures continues to pummel the U.S. housing market.
Bank of America Corp. and Wells Fargo Bank have started trial modifications for only 4% and 6%, respectively, of the eligible mortgages in their servicing portfolios, Treasury reported. Meanwhile, J.P. Morgan Chase & Co. has started trial modifications for 20% of eligible loans.
“I think it’s safe to say we’re disappointed in the performance of some of the servicers,” Treasury’s Assistant Secretary for Financial Institutions Michael Barr said in a conference call with reporters. He insisted, however, that Treasury was encouraged by the program’s overall results.
Mr. Barr declined to comment on any particular institution’s performance, but said Treasury was pushing servicers to step up modifications. “We expect them to do more,” he said.
When you take a look at the above statements on their face, you could assume it’s the result of another failed government program trying to fix a problem in the market.
But if you dig deeper and follow the money you may see a different picture. I’ve referenced in other posts and in some articles the money connection between politicians like Chris Dodd and Barney Frank and the banking lobby. It’s easy to trace the money and gives more evidence that the govt solutions really are window dressing.
Add to this the government crackdown, both on the federal and state level of loan modification businesses that are actually providing a real service to consumers but are lumped in with all the bad apples out there.
Make no mistake about it. The banking lobby has Washington, and directly associated to this the media, in their pocket.
Do a search for loan modification stories in the press. Approx. 90% of the stories I’ve researched over the last few months have been negative stories about loan mod scams. Most media stories tell you the only legitimate help will come from either the government or government funded non-profits.
The latest article I just read in the Baltimore Sun, admonished loan mod firms “posing” as pseudo govt agencies and claimed the only reason homeowners contact private firms is they get impatient waiting for non-profits to get a modification done while they slip further and further behind.
If the homeowner was educated properly they would know the typical mod takes from 90-120 days and that the foreclosure process doesn’t stop since the lender is hedging their bets if it doesn’t work out.
Unfortunately there was no mention of legitimate mod firms saving homes and getting results for their clients. We just had a GMAC 2nd modified from 14% to 5% and we’re waiting for the 1st mortgage lender to settle on terms.
My message to you is make sure what ever you decide, get the facts before you act. Be sure your decision is based on good info, not fear based on misinformation from suspect sources.
Tags: Making Home Affordable, reputable loan modification companies
