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Foreclosure Prevention Programs, Loan Modifications Waste of Time and Money?

By
Real Estate Agent with Renaissance Realty Group of Keller Williams Atlanta Partners

Foreclosure Prevention Programs, Loan Modifications Waste of Time and Money?

Taking a closer look at the realities of all the government foreclosure prevention programs sheds light on how off the mark they have been.

For the record, at the time ALL of these programs were celebrated as a possible solution to the housing crash. Sure, in hindsight its all too easy to be cynical about the Obama Administrations various programs, acts, guidelines...not to mention the literally dozens of new acronyms we have all had to learn. (HAMP, HAFA, PRA, HARP etc etc)

Here are the hard facts from the NYT and Corelogic:

Congress set aside $50 billion for foreclosure revention, amid administration projections that three million to four million homeowners would benefit from modifications. So far, the Treasury Department, which oversees the program, has spent slightly more than $1 billion, and just 607,000 homeowners have received permanent loan modifications (of those, 11 percent have defaulted).

So, projections were for 3-4,000,000 owners to benefit from modifications (HAMP) and only...607,000 actually have. Subtract from that the 60,000 that defaulted on their trail loan mods. Is being that far off from projections really a failure.....or "its close enough for government work?"

Posted by

If you or someone you know is thinking of buying or selling a home have them give me a call .. we will get it done ...right 

Eric Reid 

Associate Broker

Keller Williams Atlatna Partners
Team Leader 
Renaissance Realty Group

Comments (2)

Mike Carlier
Lakeville, MN
More opinions than you want to hear about.

At first glance, I would say that 2% of the funding was spent to achieve about 15-20% of the projected results.  It is a failure, but a cost-effective failure.  Of course, one has to ask how many of the mods would have occurred without a government program.  That is an unanswerable question.

Apr 04, 2011 04:08 AM
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC

Eric

Thanks for an update on the Foreclosure Prevention Programs have not lived up to expectation in South Florida.

Good luck and success.

Lou Ludwig

Apr 04, 2011 10:13 AM