The New York Times is reporting that the federal “Making Homes Affordable Program” can only help one-sixth of the people it was intended to.
The program, which encourages lenders to give trial loan modifications to embattled homeowners, flunked out 96,000 homeowners just in the month of July.
Those numbers are leading some housing specialists to call the program, which modestly rewards lenders for modifying mortgages, a failure. But administration officials say many households were helped even if their modifications were only temporary.
“They were able to benefit from reduced mortgage payments each month at no cost to the taxpayers,’’ Herbert M. Allison, an assistant Treasury secretary, said during a briefing.
The high number of cancellations was attributed to the rush to set up the program, which encouraged lenders to enroll borrowers first and ask questions later.
If you have tried this program, or one like it and it hasn’t worked out, give me a call. A bankruptcy case can sometimes be more effective, because each bankruptcy case is effectively backed by a court order mandating relief.
By Doug Beaton