Mortgage Servicers Slow to Help With Loan Modification
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One of the cornerstones of the foreclosure prevention efforts made by the Obama Administration is a loan modification program. This program includes incentives for mortgage services and lenders as well as borrowers. However, mortgage lenders have been slow to participate in the voluntary loan modification program. In the hopes of spurring greater efforts, the Obama Administration has released a report that shows that mortgage servicers are doing a poor job of helping with loan modification. CNN Money reports on the low amount of late mortgages getting help under loan modification:
Performance was very uneven. Saxon Mortgage Services, a subsidiary of Morgan Stanley (MS, Fortune 500), led the pack, putting 25% of its delinquent loans into trial modifications, followed by Aurora Loan Services, a subsidiary of Lehman Brothers Bank, with 21%.
GMAC Mortgage, which is partly owned by the federal government, put 20% of its delinquent loans into trial modifications.
Among the major banks, JPMorgan Chase (JPM, Fortune 500) came in first with 20% of late loans in trial modifications, followed by Citigroup (C, Fortune 500) with 15%. Wells Fargo (WFC, Fortune 500) and Bank of America (BAC, Fortune 500) lagged with 6% and 5%, respectively.
With such poor performance, it is no wonder that foreclosure prevention is stagnating. Mortgage lenders and servicers need to step it up, especially since foreclosure really isn’t any better for them than it is for borrowers.
Pending home sales increase
In other news, a report on June pending home sales shows another increase. Apparently, there are enough deals going around to encourage buyers — or at least potential buyers. The fifth straight month of increases for pending home sales is a sign that the housing market is stabilizing, and that a bottom might have been reached. If you are looking to buy a home, now may be the time to do it — before prices start to rise again.
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[...] there have been some accusations made that mortgage lenders and servicers have been slow to help borrowers avoid foreclosure. Since most of the foreclosure prevention programs in place are voluntary, mortgage lenders can [...]
[...] developments lately that have many wondering just how diligent mortgage servicers have been. While mortgage servicers were recently chastised for being slow to help with loan modification and foreclosure prevention, it appears an even bigger problem is brewing. Perhaps mortgage [...]