We’re now a few months into the Obama administration’s Making Home Affordable plan and still, loan modification requests from homeowners are being met with resistance. The nation’s top 25 mortgage servicers are now being asked to step up. Later this month, all will be on hand to meet with leaders in Washington D.C. about the program and what can be done to more actively offer loan modification solutions.
In a letter to servicing company CEOs from Treasury Secretary Henry Paulson, it is stated that “There appears to be substantial variation among servicers in performance and borrower experience, as well as inconsistent results in converting trial modification offers into actual trial modifications. We believe there is a general need for servicers to devote substantially more resources to this program for it to fully succeed and achieve the objectives we all share.”
The letter also states that the government will work with the servicers to establish better guidelines and a transparent reporting system that will detail each mortgage servicing company’s commitment to modifying the loans of its clients.
Freddie Mac, in its compliance role, will begin auditing select loan modification rejections to curtail inadvertent denials. This will help as there have been times that we have received loan modification denials that didn’t make any sense and required us to go back and point out why the rejection was invalid.
More accountability from the major servicers will be a good thing and hopefully they will build on the positive steps made with the government’s program.
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