It’s a very challenging process, mostly because the bank’s incentive to carry out the modification has never been enough and there hasn’t been enough of a penalty for them for failing to do so. Many people I’ve personally heard of waited over a year and endured lenders perpetually “losing ” their documents. It has been a mess, but it’s better than nothing. That’s for sure. Keep an eye on the actions of the bank lobby if you want to better understand why these programs have such dull teeth. Hopefully they’ll find a way to be more effective in the coming two years. From Reuters via Huffington Post:
WASHINGTON, May 30 (Reuters) – The Obama administration on Thursday said it was extending the life of its signature foreclosure-prevention program by two years to help more struggling borrowers keep their homes.
The Home Affordable Modification Program, or HAMP, was to expire at the end of this year.
When it was unveiled in 2009, the administration estimated it would help 3 million to 4 million homeowners avoid foreclosure by reworking loan terms. So far, however, only about 1.1 million homeowners have benefited from a permanent mortgage modification under the program.
“The housing market is gaining steam, but many homeowners are still struggling,” said Treasury Secretary Jack Lew. “Extending the program for two years will benefit many additional families while maintaining clear standards and accountability for an important part of the mortgage industry.”