In June, 38,728 homeowners received mortgage loan modification from the federal foreclosure program, but more than 91,000 homeowners dropped out, according to a report released on Tuesday.
Close to 530,000 homeowners in total have cancelled since Obama’s foreclosure program started in March of last year. This has been due to missed payments and a failure to submit paperwork properly.
“…foreclosure program drop outs found help elsewhere…”
Nearly 50 percent of those dropping out of the government program found mortgage help elsewhere. Most of the rest have somehow struggled on with just two percent of the drop out actually experiencing foreclosure.
Foreclosure Program
The federal government was designed to help up to four million homeowners keep their homes. But while foreclosures continue to climb, critics are saying that the foreclosure program is simply not meeting its goals.
“foreclosure program drop outs exceed new entrants…”
For two months in a row the number of homeowners dropping out of the mortgage help program has exceeded those receiving loan modifications.
“Fifteen months into this program, for every one family that appears to have made it to a permanent modification that’s likely to stabilize that family in that home, 10 more have been moved out through foreclosure,” said Elizabeth Warren, chairwoman of the Congressional Oversight Panel that oversees the foreclosure program.
“…foreclosure program gives mortgage payment cuts…”
The government help program gives homeowners who qualify cuts in their mortgage payment of up to 31 percent of what they earn each month. Their loan term can be extended to 40 years, or they can have their interest rate cut to as low as two percent.
Before receiving permanent loan modification, participant of the foreclosure program have a trial period of three months where they have to make their mortgage payments without any hiccups.
Related Posts:
- The Mortgage Modification Program – Homeowners Lower Their Home Loan Payment
- Foreclosure Program Struggles As Homeowners Drop Out
- Foreclosure Help From Government Falls Short of Expectations
- Home Loan Modification Program: Can Homeowners Help Themselves Get More Affordable Home Loan Options?
- The Obama Mortgage Loan Modification Plan Offers a Ray of Hope
