Westchester County Home News: Government Modification Program Has Helped 20 Percent of Eligible Borrowers

The Obama administration’s mortgage relief programs are beginning to pick up steam. After being widely criticized for its slow start, the modification portion of the Making Home Affordable program has now reached 20 percent of eligible homeowners, officials said Tuesday.

According to the Treasury’s monthly status report for the program, 650,994 active trial and permanent modifications are now underway. Another 268,971 offers for trial mod periods have been extended to troubled homeowners.

“The program is having a pronounced impact in areas particularly hard hit by the housing crisis,” Treasury Assistant Secretary Michael S. Barr said in a statement to the press. “We’re reaching borrowers at a larger scale than any other modification program to date, but there is still much more work to be done.”

Seventy-one servicers have signed agreements to modify loans under the Home Affordable Modification Program (HAMP). In addition, roughly 2,300 lenders service loans owned or guaranteed by Fannie Mae or Freddie Mac, and are automatically able to participate in HAMP.

Saxon Mortgage Services and CitiMortgage lead the way in terms of the percentage of eligible loans with trial modifications started. Saxon has initiated trial mods on 35,027 mortgages – that’s 44 percent of its eligible loans. Citi has 88,968 trial mods on course, or 40 percent of its eligible home loans.

When you add up the number of active trial mods for each servicer, Bank of America takes the top spot with 136,994 modifications in the trial phase, but that equals only 14 percent of the lender’s eligible loans. J.P Morgan Chase runs a close second in terms of the total tally with 133,988, or 32 percent of its eligible mortgages. Wells Fargo ranks third, having initiated 93,652 trial mods on 29 percent of those eligible.

Tuesday’s MHA status report included a new data breakdown of state-specific trial modification numbers. Homeowners in the foreclosure-ravaged states of California and Florida have received the highest level of assistance under the government program.

Over 134,609 troubled borrowers in California are now in the modification trial phase. In Florida, 82,614 trial modifications are underway.

In July, the administration challenged servicers to ramp up the pace of modifications by mandating a minimum of 500,000 trial mods by November 1. Treasury’s latest report shows the industry has surpassed that goal by more than 150,000 by the November target.

Faith Schwartz, executive director of HOPE NOW, praised mortgage servicers for their “unprecedented efforts” to keep people in their homes. According to Schwartz, since the beginning of 2009, servicers have also offered additional workout solutions through repayment plans and modifications to over 2.3 million homeowners.