WASHINGTON (KCBS) - The Obama administration is becoming impatient with the slow pace by which mortgage companies are modifying loans for millions of homeowners.
The $75 billion taxpayer-financed program has averted a relatively small number of foreclosures.
As KCBS' Susan Leigh Taylor reports, there's a bit of a mystery as to why things are moving so slowly. "This much we know, the mortgage servicers, which is to say these companies that send you your monthly bill, are swamped with applications," explained Peter Goodman, a New York Times national economics reporter who has been exploring the situation. "They don't have a lot of people answering the phone. They don't have a very good tracking system or filing system and applications are getting lost."
KCBS' Susan Leigh Taylor reports
According to Goodman, lenders were hardly this slow when it come to giving the original loans. "Something tells me that if people were calling up to refinance their loans and send, you know, $5,000 in fresh fees to the large mortgage servicers, they would be doing a better job."
He attributes part of the problem of modifying loans to the complexity of the situation. Chances are, your mortgage is not owned by the company sending you the bill. There's also a good chance your mortgage was pooled with millions of others that were turned into exotic investments. Essentially, a consumer who calls to report experiencing trouble paying a mortgage, and request a modification of that loan, there may be a string of people needed to sign off on a new deal.
Print Story
DW.pageParams = {
siteId: '255'
};
DW.clear();
DW.trackClicks();
