This was supposed to be the year of loan modifications: plan is widely considered a bust.

[Bluebear]

This was supposed to be the year of loan modifications.

With great fanfare early in the year, the Obama administration unrolled a plan to spur banks to help troubled homeowners avert foreclosure by reducing their monthly payments.

But at year end, the plan is widely considered a bust.

Borrowers complain of months of begging and endless phone-tree loops. Banks complain of borrowers who don't submit documentation and don't return calls.

The net results have been paltry: Just 31,382 borrowers nationwide had received permanent loan mods as of Nov. 30 under the Home Affordable Modification Program (HAMP), the Treasury Department reported. Meanwhile, First American CoreLogic says that 1.7 million homes are likely to be lost to foreclosure next year.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/12/22/BU041B6FAO.DTL&type=business

[cliffordu]

1. So many failures in one year

Tragic, really.

[DJ13]

2. In the old days a President made demands

In todays corporate paradise he asks nicely.

[chill_wind]

3. Horrible results reflected in those numbers! :-(

2 1/2 years ago, we tried to buy a house being offered up on a short sale. Our offer and our financing were solid. The house had already been sitting empty for almost a year. The poor owner had already gone to a nursing home and really needed the house sold. 3 months later, we were still waiting to hear from and couldn't get a decision from the owner's bank. We had to give up and move on. Some months later, it finally sold, for FAR less.

Typical, the realtor said-- the banks all over the country were buried under a mountain of back paperwork from the record numbers of defaults and foreclosures, and our offer was probably still sitting somewhere at the very bottom of the a mountainous stack in some bank on the other side of the country. That was two years ago, before all of this above came into effect. There's nothing efficient about any of this when it comes to dealing with the reams and reams of red tape and procedural molasses of so many of these banks.

Almost a year to get 31,000+ processed and approved and saved for now-- 1.7 million more with almost no prayer at this plodding rate. It's a crime.