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July 29th, 2009

Lenders: simplify the loan-mod process



Yesterday’s meeting regarding the government-sponsored loan mod program we wrote about yesterday went pretty much as expected:

After a series of meetings with top banking executives, Treasury Department officials said they want lenders to modify 500,0000 mortgages by Nov. 1. Since the program, known as Making Home Affordable, began in March, it has recorded about 200,000 loan modifications. [...]

Officials from the Treasury and the Department of Housing and Urban Development discussed with the banking executives ways to get aid to borrowers more quickly. Lenders asked the government to clarify which borrowers are eligible and to simplify the program, according to industry officials briefed on the meetings. Administration officials again urged lenders to hire more staff to keep up with demand from borrowers seeking loan modifications and reminded the executives that the program is a White House priority, according to participants in the meetings.

Lenders also made some good suggestions, including standardizing the loan documents requested from loan-mod applicants, and setting up a website for where they could apply. The lenders also asked, again, that the government quantify at what level of “financial distress” a borrower would be eligible. Those are good ideas which shouldn’t take too much work to accomplish.

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HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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