Officials: Foreclosure Rescue Tally Jumps to 116,000

Mortgage reliefThe number of homeowners facing possible foreclosure that have permanently-reduced mortgage payments was up to 116,000 in January, almost double the number from the previous month, the U.S. Treasury and the Department of Housing and Urban Development (HUD) announced today.
The January update for the government’s Home Affordable Modification Program, HAMP, also showed that an additional 76,000 borrowers are pending permanent modifications.
The overall rate of those eligible homeowners who are getting assistance under HAMP is up to 28 percent, up from 25 percent in December.
In total, 1.3 million offers of modification trials have been extended to distressed borrowers, thus far, in the foreclosure rescue program, which has been under much criticism by borrowers for its stringent and time-consuming qualifications.
Consumer watchdogs and mortgage industry experts have also said the program is ineffective in slowing down the foreclosure crisis, in part for not offering widespread principal forbearance to combat rampant negative equity, or “underwater mortgages.”
Treasury and HUD officials recently announced new paperwork guidelines to speed up permanent mortgage modifications.
Nonetheless, the higher mortgage-relief numbers – and higher rate of assistance is an improvement the Obama Administration is touting.
Phyllis Caldwell, chief of Treasury’s Homeownership Preservation Office, said a total of 940,000 homeowners, most of them in trial phases, are currently seeing reduced monthly payments.
“With nearly one million homeowners paying less each month and the number of permanent modifications steadily rising, HAMP is doing the job it was designed to do,” Caldwell said.
The median monthly savings in the program is more than $500.

3 thoughts on “Officials: Foreclosure Rescue Tally Jumps to 116,000

  • February 17, 2010 at 4:49 pm
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    where can you find information on how HAMP works and is funded? Is the bailout of the individual seeing much in the way of applications from borrowers who are trying to get the money because they might be able to and not because they really need it? just interested to find out if there is much in the way of moral hazard on this

  • February 17, 2010 at 4:59 pm
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    The required income verification and other requirements are quite extensive, and most of the criticism has been that borrowers who really need it can’t get assistance or stay in the trial phase. The following is the administrators’ website for hamp: http://hmpadmin.com It has quite a lot on servicer guidelines, much of it open to the public. Hope this helps.

  • Pingback:eCreditDaily:Wells Fargo: 3 Modifications for Every 1 Foreclosure Sale « Mortgage Fraud Musings

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