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The Administration's Foreclosure Program - In Need of Major Changes

With foreclosures still occurring in record numbers, the administration has announced that it will be making some changes to its "Home Affordable Modification Program."

The original $75 billion Treasury program was put into effect to help potential foreclosure victims by enticing the banks to create loan modification programs for those who needed them. Under the plan, lenders who agreed to lower payments for troubled borrowers were to be paid $1,000 initially for each loan. That was to be followed by $1,000 annually for up to three years.

It was all part of the government's $700 billion financial bailout aimed at providing incentives for mortgage providers to be willing to accept smaller payments rather than to foreclose on homes.

To date, homes are still being foreclosed on at record rates. A report last week by the Mortgage Bankers Association listed that 14 percent of homeowners with mortgages are either behind in their payments or headed for foreclosure. This was a record level for the ninth straight quarter.

The original target for the foreclosure crisis had been borrowers who had gotten involved in subprime mortgages. It seems now, according to a report last month by the Congressional Oversight Panel that this threat has now extended to those who took out conventional, fixed-rate loans as well. It has even extended to some borrowers who were able to put down a significant down payment on their homes of at least 10 to 20 percent.

One of the criticisms made by the treasury panel is that the current program is still targeted at the housing crisis as it existed six months ago and has not been updated to address the current situation which deals with a different set of borrowers, not only those with subprime loans.

What are the planned changes to the current program?

Officials have said that they are making changes that will increase transparency and accountability from mortgage companies. One of these is to put more pressure on lenders by highlighting the ones who are lagging in loan modifications.

Another is to delay the cash incentive payments to banks until the loan modifications have actually become permanent.

The question is, with the rise in unemployment and the basic ineffectiveness of these programs to date -will these new changes be enough to stem the tide of yet another phase of mounting foreclosures?

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Posted by Claudette Millette - Metrowest Mass Buyer Broker on 11/30/2009 10:29 PM

Comments (59)

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59 Comments on The Administration's Foreclosure Program - In Need of Major Changes

NOV

2009

I think that the programs put forth are not working. It seems that the banks are absorbing the funds into their profits and there is no trickle down benefit to the general population.

Vickie:

I tend to agree with you. They do not seem to have been effective yet.

Lordy, Lordy! Those nasty banks....what are we all going to have to do to stop the bleeding our homeowners are experiencing. Foreclosures are driving the market down in my area. You are right, we need another look at what is actually happening with these banks.

Sandra:

Someone is going to have to get control of the situation and I don't think it has been handled very well to date.

Claudette, yet to be determined in this foray is the number of homeowners who have in the past two years, just walked away from their mortgage payment,...only after buying another larger better home for half of the money they owe on their home in foreclosure. Our current Administration is forcing the banks to negotiate lower interest, lower payments and many times lower principle without allowing for a balanced program DEPENDENT on tighter controls and guidelines for both the banks as well as the mortgagee. Fraud is prevalent wherever government programs exist.

Does this happen often? Absolutely! Two of my past agents, (I owned a mortgage company for the past 15 years- until the crash), have pulled off this stunt while collecting rents for a property they borrowed 100% against, full knowing what they were going to do. I have also heard of at least three more real estate agents that have done the same thing in my market. Under the new program, they all are eligible for the recent program guideline changes regardless of their doing.

New programs must have checks and balances for all parties involved, not just the homeowner. Without it we are heading for a "socialistic agenda" to this ever growing problem.

Remember that banks are about the bottom line. An they know more than anyone how to grow profits. The deal is this needs streamlining with checks an balances. Let the banks worry about there own money and stop profiting off ours.

DEC

2009

Please consider the following:

The realization that the "banks" (actually not banks, but rather nonbank lenders/servicers) advanced hundreds of thousands of dollars to people who never really had the actual income necessary to afford the loans.
Those loans were made without any underwriting criteria, and therefore, the lenders/servicers have no internal ability to underwrite loan modifications.
With declining actual income as compared to inflation, prices need to decline further so that prices match affordability. Not until affordability (the real income necessary to give rise to a household to purchase goods and services without the necessity to borrow to make debt service payments) returns to the marketplace will the market finally stabilize; which equals further declines in prices. Sorry, but this is just simple economics.
Only the bankruptcy courts have the years of experience and procedures in place to enable modification of home loans, but the bank lobby continues to buy off your elected officials from doing what is in the best interests of all of us - bankruptcy reform to enable home loan modifications. If you agree - call and write your Congressperson and Senator.
if each home contains the elements of a robust economy, but families are being pulled apart through the economic meltdown, causing divorce rates, mental illness, spousal abuse and substance abuse to increase as a result, isn't real reform to enable more homes to be kept together more important and less costly than health care reform? Isn't 25% of homes being worth less than the amount owing (WSJ) a greater number than those without health care insurance? Just a thought on National priorities!!

Thank you for the post, I hadn't heard of this yet. Thanks

Claudette- I am no fan of banks and we do short sales day in and day out here in Florida. The banks though are in bed with big government and politicians. They sugar coat their lies and we buy the next candy cane they try to sell us in hopes things might get better but sugar coating does not stop the bleeding.

Louis and Jerry have it right. We have lots of people buying the house across the street for less than half of what they bought their house for and then leaving the keys on the table of the house they just walked from.

The banks are looking at their bottom line. In most cases here in Florida the attorneys doing the foreclosures have factories operating and have reduced their fees to get the biz to $3500 per foreclosure. So you have to sell the servicer on taking the short sale because they will make more money than on a foreclosure but telling the bank that they will lose on a foreclosure is no longer the case. The banks are not in the charity business, they are in the business to make money and we are the ones who allowed them so much control over our lives by using credit cards and wanting it all now.

At the end of the day, these banks have shareholders to account to and guess what, many of your teachers, mothers, fathers, retired family members are the ones who are those shareholders.

So we need to be careful what we ask for. Katerina

Too little too late seems to be the motto for the "bail out money". The only people benefitting are the banks who are stalling, using the funds, and creating quagmeir's of obstacles for people who really need the help. Oui' vey

Massive change needs to be done for the program to work. A third party (not the govt or the bank) should oversee if managed properly

Thanks and have a great day

Tony

Thanks for sharing this. While I understand the need to make amendments in these situations, I'm just appalled by the cost it would take to fix it. In the end, I'm afraid that all the government would end up doing would be just to print more money, after all they can do that. But that in itself would dilute the value of our every dollar.

I'm not blaming the automated system that was once used to speed up loan processing, it just doesnt make sense anymore. We went to one extreme of having a heartbeat, you get to loan to perfectly credit worthy people having long checks and audits to have their loan approved.

Hi Claudette,

This is a great post. I was just listening to an article on this subject yesterday. This bailout is not working..like anything else the government tries to handle there are too many hands in the pot!

I agree with three of the comments being made from Louis, the Gasset's and Jerry. Everything is conjecture and for some reason we pile on more speculation such as if this was done or had been done.

What I do see is many homeowners are in jeopardy of losing their home because of job loss, health issues, and we still want to lump it all under the umbrella of loans that were given to quickly to those that were unqualified. Enough. The reason for this debacle has many layers.

Jerry & Katrina:

Fraud is prevalent wherever government programs exist.

Those of you who are on the front lines doing short sales and in the mortgage industry are bearing witness to a great deal of fraud that is taking place under these programs. I think this is further evidence of the need for sweeping reform to this entire process.

Dan:

I agree. There should be a series of checks and balances.

Louis:

With declining income, declining home prices seem to be the natural pattern. It will have to reach a point of affordability that I don't think is quite here yet, particularly in certain parts of the country. And, I think you are correct - real reform is necessary at this point.

Terrylynn:

The way that the banks are using the bailout money is in question right now.

Tony:

A third party overseeing the process would not be a bad idea.

Loreena:

We have definitely gone from one extreme to another - from basically no income verification to now actual credit worthy people having a tough time getting loans.

Dorie:

There are a lot of hands in this pot, and, also not enough transparency and oversight of the whole process.

Lorraine:

This has definitely moved past the initial situation where the problem was only with people who had gotten loans they were unqualified for. I agree, this now has many layers.

Claudette - The administration's planned changes won't be enough to make much of a difference. I posted on this same topic yesterday. Of all those who have entered the modifications program, less than 2,000 have been approved. They need to forget the current system; it doesn't work now and won't work in the future.

ToulaRosebrock,com

Hi Claudette:

Fantastic post!

With the unemployment rate raising...our government needs to come up with a realistic plan and not just throw good money towards it.

I'm finding that banks are not cooperating with loan modification requests.

We're in for a tough 2010, for sure...

The federal guidelines will need constant tweaking and oversight. Fortunately (or unfortunately, depending upon how you look at it) - there is likely to be a moratorium on foreclosures in the North Eastern states that have non-judicial foreclosure proceedings. No judge is going to allow a home to be foreclosed if people are living there during the winter months.

The prediction that the second wave of foreclosures is coming is reality. We have not learned from our mistakes by allowing people to borrow up to their necks to get into a new home so that they could get a tax credit for a purchase that they really shouldn't have made. Many of these homes are becoming neglected because the buyers claimed that they never fully appreciated the full cost of home ownership including maintenance, landscaping and repairs.

Unlike Louis, I am totally against the bankruptcy courts taking over foreclosure proceedings.

A tiny fraction have gone to permanent modification and the redefault rate on the temporaries is over 60%. The problem is not merely changing the program, the problem is the economy. You need a job to refinance I believe.

John:

I just read your post. It is really interesting. I hope for a better outcome than you are predicting, but it is an excellent piece. For anyone who would like to read John's post on the current foreclosure situation, it is here:

John Mulkey's post

Toula:

Thank you. I think you are right about next year, but I am hoping for the best.

Great post and well though out.... But... Until the American Public is reeducated about money we are still going to be in the same boat.. We are a buy/charge it now, pay for it later society. I don't really think the US Government who is TRILLIONS in debt is going to be able fix the housing market. We the people need to start being responsible for our own actions, or lack of them.

A few facts...

Aftert the program launched March 4, Treasury notified servicers they were not required to get full documentation for borrowers in order to get them into trial modifications Then to put pressure on lenders the government started publishing monthly lists of services with the percentage of eligible defaulters in trial mods, excoriating those that lagged.

Is it any wonder servicers pulled out all the stops to get trial mods, breaking the goal of 500,000 three weeks early and moving the total up over 650,000?

Ooops. They don't have documentaion. Surprise. Now, after the fact, servicers have to go back and get documentation....from the very people who took out loans inthe first place without documentation.

Sounds like a mess. Any guesses on how many of the 650,000 will make it through the process? Half?

Claudette-

I'm not sure exactly what the lenders incentives are but according to pg. 9 of this document from Making Home Affordable.gov-- http://www.makinghomeaffordable.gov/docs/borrower_qa.pdf #15 states "Borrowers who make timely payments on their modified loans will receive success incentives. For every month you make a payment on time, you will accrue an incentive that reduces the principal balance on your loan. If your loan ceases to be in good standing (three monthly payments are due and unpaid on the last day of the third month), no further success payments will be paid, including accrued but unpaid amounts. The incentive will be applied directly to your loan balance annually and over five years the total principal reduction could add up to $5,000. This contribution by the Treasury will help you build equity faster."

What many don't know is that the borrowers are also given incentives provided they make timely payments. No doubt the criticisms in regards to this program are that it doesn't protect homeowners who've lost their jobs from going into foreclosure and with unemployment at 10.2% there are plenty. Third quarter foreclosures were alarmingly high across the country-- No doubt after the gov't stops purchasing mortgage backed securities after Q1 next year, we are going to see even bigger troubles and more foreclosures as interest rates will increase. Currently banks are taking too much time to collecting paper work and many people aren't receiving the help they qualify for.

Perhaps the Courts will start taking matters into their own hands. Here is my post about a judge in Suffolk County on Long Island that became fed up with a bank during a foreclosure action. Because its arrogant attitude he voided the mortgage entirely.

Claudette, thank you for sharing this information. Very informative post. We all need to stay on top of this so please keep us posted on updates.

I don't know what to say. The foreclosures are a damn shame and it only seems to be getting worse.

$1,000??? Not enough to impact the bank's decision obviously. It will continue to be painful, but the market will correct itself. I believe government intervention only slows the recovery, although it may help individuals.

Great perspectives in these posts! In our area in Florida, the strategic default is the option most people are taking. My heart goes out to anyone who is dealing with job loss, but it is the acceptance of just walking away from a house that the owners CAN pay for that is continuing to hurt the market. I am sorry that you will not see property values increase 20-30% this year. I am sorry that you didn't double your money on the house you intended to flip...you were going to share the proceeds with us right? Instead now we are all sharing the aftermath of avarice. Now, if we are lucky enough to have a qualified Buyer, the appraisals are coming in too low to get financing...and the FHA appraisals stick to the house for 6 months!

Very interesting. You all have some very interesting perspectives. So many of these pieces fit together in such intricate ways. People who were very responsible with their money were hurt by those who weren't and by those who scam the system. It is easy to see mistakes in our rear view mirrors, but it is difficult to see how such a large scale mess can be cleared up while still teaching us all a lesson. Government may not have a great solution now, but the banks are certainly not going to change without someone as big as the government pushing them.

I have only had one client to successfully get a loan modification. It has made all the difference to her, but it was very difficult to manage.

It is not working as it stands, all you have to do is look to see that. What are they really doing and will it help? I am not certain any of this will prevent another major wave...

I hope this shakes things up...what I find most upsetting is that the expectation for these families is that they will be OK, then the home is sold out from underneath them. Not fair.

While I am not an economist, I do have a BA in economics from the University of Pennsylvania. Here are my thoughts on the current foreclosure and housing situation.

The foreclosure programs are a failure as are all of the Obama Administration's economic stimulus programs. The are nothing more than short term market distortions with long term adverse consequences. The reason is that the short term "goodies" they are trying to employ to entice things to happen now (i.e. tax credits to encourage home buying, cash for clunkers, stimulus monies for infrastructure projects, bank bailouts to encourage more lending, green energy tax credits, etc.) are short term and the effects are ephemeral. Meanwhile, these short term "goodies" cost the taxpayer lots of money (record budget deficits), which will have to be repaid in the future. Everyone (or at least intelligent people) knows this and so everyone knows that taxes will have to be higher in the future to re-pay these costs. Therefore, businesses know that they will have less money in the future, not more. Therefore, businesses do not hire any long term employees, and, as a result, unemployment continues to rise thus putting more downward pressure on the housing market. As a side note, even the "green energy" tax credits (which are heralded to create high paying jobs) for things like solar panels are bad because if a business can profit by selling a product (that is really not competitive in the marketplace) as a result of government tax credits that company has no economic incentive to risk money in order to improve their product. Therefore, these "green energy" tax credits will end up retarding innovation and research and development resulting in a permanently inferior product. Meanwhile this all costs tax payers money (see the bolded words above).

The homebuyer tax credits are bad since they are just perpetuating the problem that caused this whole financial mess to begin with: people with no money buying homes. For example, in 1955, my aunt an uncle purchased a row home in Philadelphia PA for $10,000 with "only" $1,200 down. The cost of the home was about 3 times their income (only my uncle worked). Today in that same neighborhood, homes sell for $120,000 to $130,000, which is about 4 times the average income. The government lending and debt policies have enabled these homes to be inflated above normal price to income trends. Recently, in Murfreesboro TN I was involved in a short sale where the buyer purchased a $120,000 home with about $1,200 out of their pocket (and he was literally counting the dollar bills and change at closing to make sure he had enough). A little historical perspective helps to show that the current situation is absurd and unsustainable. Many of these new buyers (courtesy of the FHA, VA and USDA government lending programs) will end up in foreclosure, which will only push this problem into the future. Also, the short term artificial home buying surge created by the tax credit has caused builders to start building here in Middle Tennessee. In the last few months I have seen at least 8 spec homes built just in my neighborhood alone - I'm not kidding! Meanwhile, many of the new homes that do not sell to tax credit buyers will likely end up in foreclosure. As a result, there is no way the worst is behind us. Housing is not done bottoming out. Government debt (tax credits, expanded FHA and increased loan buying via Fannie Mae/Freddie Mac and Ginnie Mae) is the only thing propping up the market now (see my posts: Real Estate Fiction, The Unsustainable US Economy and Our Phony Real Estate Market). This is what is coming within the next 12 months: (1) the government market propping is going to run out of money and be stopped leaving the market with little to no financing, (2) the next wave of Option ARM foreclosures (almost as big as the subprime debacle) will begin in the spring of 2010, (3) commercial real estate loans are going to start to fail in large numbers further damaging banks and (4) banks will start failing in huge numbers (already this is by far the worst bank failure mess in US history by dollar volume - don't be fooled by the number of banks failed; the banks today are 10-100x bigger than in the past). In short, 2010 and 2011 will be very bad. The real estate market will only start to improve in mid 2012 and even then it will be minor. The rest of the 2010-2020 decade will see very little appreciation, which will actually be normal and good in the long term.

$75 Billon Stimulus - The $75 billion Obama "Making Home Affordable Plan" mortgage stimulus package is not working!

The Problem - Although the guidelines say that there is not a minimum FICO score requirement for one to refinance, the lenders, Fannie Mae & Freddie Mac are setting the refinance rates based on ones current FICO score. So, if someone has been having a tough time and late on a car payment, house payment, etc., but now current on their mortgage loan, they're not going to get a rate under 5% due to having a low FICO score, but closer to 6%.

One could argue that 6% isn't a bad interest rate, and it isn't, but what if their rate is already at 6% - 6.5%. In Texas, for someone having a $300,000 mortgage loan refinanced the cost is approximately $7000. Therefore, it wouldn't behoove or make any sense for these individuals to refinance. Besides this fact, of the $7000, $4100 is going directly to the lender in fees, $2200 of it goes to the title company in fees, the remainder gets eaten up in appraisals, attorney fees, etc.

The Fix - If the borrower doesn't have to have a 680+FICO score to refinance, why would you give those that need help the most, a higher than market rate? If it's supposed to be stimulus, let's stimulate those they need help the most. GIVE EVERYONE THE SAME RATE!

Additionally, let's add stimulus funds for those who do not escrow for real estate taxes & homeowners insurance and are behind on their real estate taxes in which the lender is pursuing foreclosure on. Have the servicer add up to 2.5% of the outstanding balance of the loan to the back of the note or file a 2^nd lien to pay the past due real estate taxes, and require escrow accounts to be set up. This will negate the need for a new loan with all the refinancing cost associated with doing so.

I have only had one client to successfully get a loan modification. For her it was a life saver.

I have a problem calling many of these people "victims" of foreclosure...

No credit. No job history. No money down. No savings. No reserves. No skin in the game. No wonder...

All I see is a bunch of REALTORS(R) trying to assuage a guilt complex -- pushing for more gov intervention and regulation of things that the gov had no business of being in the middle of in the first place. "Help the victims!"

The government can't even manage/run itself effectively and efficiently. You really want to help the "victims"? Why not ask your broker to start listing them for free. Do the same charity work that you expect the banks to do.

The government made this problem, now everything they are doing to clean it up is only prolonging the pain and making it worse. No Bailouts - Just Cut spending and cut taxes.

Jessica you are harsh...many of these consumers were victims of a bubble in values, many were profiteers who deserve what they got, a few were dishonest frauds. We can't paint everyone with one brush.

OK - a simple point that all are missing...Yes there is a problem. It started a long time ago with the democratic congress that housing should be affordable for all. Programs were offered to those with lower income - thus artificially driving the cost of lower quality homes upwards. The programs were then pushed to their limits to qualify people for homes slightly above what they can afford. Thus driving those prices higher that they should be. I lived in Arizona for 5 years. I purchases my home for 215000 and saw the value rise to over $400,000. I had lenders and agents calling me to refinance and sell. I just sold this summer for $270,000. Just where it should be.

None of the Gov't plans work. Self correction is what will fix our market. But shame on the LO's AND Agents out there who would "talk with the appraisers to get the value the needed for the offer...

So what am I saying...the industry is to blame just as much as the Gov't, we all let it happen now we must suffer too.

Art:

And how did that bubble happen? Everybody should own a home...

No, what will be harsh is when all the artificial sweeteners run out and we're left drinking this bitter cup. Correction is painful, but we've got to put the crack pipe down and get off the drugs. There are consequences for our actions and running to the government to fix the very problems they helped create is insanity.

Great post! I too have been following the Home Affordability Modification Program and the general consensus seems to be that it has not worked as promised. Is more government intervention the answer? Is more accountability from the Homeowners the answer? I am not sure about either one, but I DO know that the process of requesting a loan mod under the HAMP, let alone getting one actually approved and permanently modified is proving to be a nightmare for most Homeowners.

I just read an article in the local newspaper that Bank of America has hired VOLUNTEERS to knock on their neighbor's doors that are behind on their payments and ASSIST them with the process! If this works, they are talking about expanding this effort.

We STILL have a long way to go!

Hi Claudette, Wow, you generated a lot of great comments. My concern is that the housing boom was created with bad legislation, artificially low rates and ridiculous qualifying parameters. All resulting in a real boom bust scenario. Yes, it did artificially pump the economy up for a time, but are we paying the price for that now or what?

The second concern is that the statistics of loan modification are not encouraging. The last I saw is that about 60% of these homes are back in foreclosure within 6 to 8 months after the modification. What else would you expect? Unqualified buyers are still unqualified buyers. More proof that government rarely solves any problems. Unfortuantely, the real solution is to let the markets operate freely and settle out at the real values. Painful? Yes. but a more lasting stronger base will be formed for the economy to grow from in the future.

And these are the same politicos who want to run your health care. Beware!

Well, here is my recent experience.

Single mother saved her money, has excellent credit but not a real high income. We found a manufactured home close to her parents in very good shape which the previous owners had signed over a deed in lieu of foreclosure with a loan balance of more than $105,000.

Listed at $80k we bid on bidselect at $62,000 and got the contract. HUD Appraisal was $100k in July. The day we received the response on bidselect, our lender advised us that her manufactured lenders had pulled out. No lender, promptly found another lender. That lender got her info from the closing agent on 5 days later. The closing agent is an attorney. Texas uses title companies normally. Title companies give the lender a closing protection letter. Attorneys are not title companies so they give E&O. NONE of the manufactured home lenders accept E&O, only accept CPLs. Lost that lender. Got on the HUD website and started calling lenders, ones we knew & ones we didn't. Several promised they could do it; UNTIL they checked with their underwriters. NO CPL, no loan. I spoke to Southwest Allliance. Could they move closing to a title company. We have SEVERAL lenders who will do the loan IF we close at a title company instead of an attorney's office. NO DICE. Close with an attorney only; the lender not accepting a CPL is not a good enough reason to refund the earnest money in the eyes of HUD. WE finally found a lender who said they would do the loan as an exception. THEN the lender changed their minimum loan requirements to $65k. Buyer was willing to pay $5k more to complete the deal. Spoke to HUD to INCREASE our offer $5400 and they DECLINED to amend the contract.

Ready, willing and able buyer offering $5000 EXTRA on contract and was turned down. Makes sense to me, doesn't it to you? & We the taxpayers are paying for this insanity.

Until the government and this administration get out of the way and let the market correct itself, we will only be kicking the can down the road. The Loan Modification Program (H.A.M.P.) has been a disaster. Lenders realize it is more financially rewarding to foreclose than to do a loan modification. Large numbers of these LM's are defaulting. We are facing another wave coming in mid 2010 with the Alt-A's and Option Arms.

Gov't & Wall Street are gaming the market and propping it up. These will eventually fail. The question is not if but when. The quicker we allow the market to correct, the better off we will be. There is no way to avoid the pain, but as with a band-aid, it is easier and less painful to just rip it off quickly rather than slowly.

Hi Claudette -- If all the changes are the two you listed (primarily), then I don't think these changes will have any measurable, positive impact. I keep reading that the alt-a and arms going into default will keep rising for the next several years, so I'm not sure the current problem is being addressed. I would rather see the government get out of the way, have a massive amount of pain for a shorter period of time, and then create some common sense regulations so the play money people can't just wreak havoc at will.

The fundamentals were wrong to begin with...

All of the programs created by an entity to fix a problem they created is not the solution.... it's the problem in extending the pain even longer.

Katerina & Jessica certainly get it... I suggest anybody else who does not get it take a day or two and learn about the giant pool of money, the Federal Reserve and the relationship between D.C. and Wall Street.

Maybe then you'll understand what and why over a Trillion of Taxpayers money is being spent for...

Artificially propping up high home prices does not benefit Main Street in the long run....

Thanks for the update, it is hard to keep up with all of the changes that are going on.

Hi Claudette. I work with short sales and REOs and from experience TARP money is not helping many homeowners. Instead it is delaying recovery while masking the government's aide to certain corporations. The government helped some corporations more than they have helped homeowners. IMPO they should stay out of business and focus on increasing its efficiency before creating havoc on business with their inefficiency. I remain hopeful. ~ Lana

Claudett,

Its amazing the customers that do not know about this program.

Claudette: Congrats on the feature. I don't think any changes to Making Home Affordable is going to do any good at all. It boils down to the fact that some people financed homes in crazy ways because they could not afford them otherwise. Unless principal balances are reduced (and boy would that piss off a lot of Americans were are upside down and making their mortgage payments on time), this just needs to run it's course.

As usual the banks and other lenders are taking advantage of many people who are losing their home when they should not be. The whole foreclosure thing is a tragedy in my opinion. It seems like a lot of homeowners don't think it is a big deal to let their house go into foreclosure. That attitude is a reflection of society as a whole.

I have people say to me all the time AREN'T BANKS SUPPOSED TO HELP US stay in our homes? Unfortunately it's not happening ...

The government programs are not doing what they are supposed to do, and I'm not convinced anything will change any time soon.

This program is important, but it is more important to have a program to create jobs now.

David Cook, comment #36 above, NAILED IT. The solutions are out there, but the bankers own the politicians, and neither want things to "get better"... They benefit by the chaos & turmoil...

DEC

2009

The lenders and gov't put out a bad product at the wrong time and the consumer is paying the price. The programs today are not going to work, unless they truly change the entire process. How can anyone who is having difficulty with their mortgage, qualify under the new standard? Principle reduction must be considered and we should all be questioning why it is not.

If short sale/foreclosure the principle is reduced, what is key here is the banks right the loss off. Yet during a loan modification this is not an option, in fact cost are added to the back end. So who would qualify?

I know many people who have been denied a modification and yet can get no answers from the bank on whether they will accept a short sale/deed in lieu or anything. They get resubmit, resubmit, resubmit.

Lenders signed a 30 year contract and most consumers are having a few months problem. Sad, it could be easily fixed and yet no one is willing to look at the big picture.

DEC

2009

There are so many problems with the mortgage crisis right now that I don't even know where to begin. Foreclosures, fraud, ID theft and so many more. I don't like government involvement, because their idea of a fix is to throw money at the problem. We see where that has gotten us and it certainly isn't the right direction. I think investors need to hold their processors accountable rather than the government.

Todd Clark - www.LivingBeaverton.com

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Ashland, MA

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The Buyers' Counsel

Address: 27 Thomas Street, Ashland, MA, 01721

Office Phone: (508) 881-6230

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