Fed Pressures Lenders To Help Borrowers Avoid Foreclosure

moneyApparently the Obama administration is cracking down on mortgage companies that aren’t working hard enough to help ‘at risk’ borrowers keep their homes.

The Associated Press reported recently that there are over 70 companies participating in the $75 billion government effort to slow down the national foreclosure crisis.

News is focused on the three-person SWAT teams that the Treasury Department is sending into the eight largest companies that are part of the program.

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The interesting twist on this issue is that the mortgage companies, or more specifically, the loan servicing companies who are tasked with loan modifications and short sale negotiations say that they are having a difficult time getting borrowers to complete the paperwork needed to process the loan modifications.

Reports are that over half of the $375,000 borrowers who qualify to have their loan modified by the end of the year have screwed up their paperwork. Either they have submitted incomplete documentation, or sent in nothing at all.

By now the Treasury Department has likely published, as promised, a list of the mortgage companies that are not moving quickly enough to satisfy the Treasury Department’s goals set for them.

The A.P. article I read recently also claims that lenders such as Citigroup and Wells Fargo have done a good job signing up eligible borrowers for trial modification programs, but other large companies such as Ocwen Financial, and American Home Mortgage Servicing are doing a poorer job than their counterparts in the industry.

Think you may be eligible, or just want to find out? Call 888-995-HOPE, or check www.makinghomeaffordable.gov.

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Zachary Epps, full-time RE/MAX professional, and author of the Boulder Neighborhood Guide.

Comments

One Response to “Fed Pressures Lenders To Help Borrowers Avoid Foreclosure”

  1. Government Refinance Mortgage Programs on January 10th, 2011 6:59 pm

    I think that there will definitely be a refinance boom with rates so low. Those home owners that did not fall victim to buying too much house or taking out the wrong kind of loan can definitely reap the rewards that the low interest rates bring. Especially with the government refi programs available, anyone with decent credit can take advantage.

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