Obama Administration’s Making Home Affordable Plan Has Problems

Up to 9 million homeowners who are at risk of losing their homes were supposed to benefit from the Obama administration’s Making Home Affordable program. Participants were supposed to be able to lower their monthly mortgage payments through refinancing.

The plan was supposed to help more than 4 million homeowners by guaranteeing loans through Freddi Mac and Frannie Mae; other citizens in need were meant to benefit from the $75 billion in incentives given to providers in order to administer mortgage modifications.

However, the plan, so far, has had some problems.

Though 190,000 mortgage modifications have been made, more than 1 million more homes are still being fed to the wolves, with lenders closing in on foreclosure proceedings faster than borrowers who wish to participate in the Obama program can close in on their own deals; 20% of these homes have already been repossessed.

In fact, many participants have complained of lengthy backlogs and delays, as well as mistreatment from lenders–including being given inaccurate information and having their phone calls unreturned. Others simply report being denied help, period.

Banks are taking as much as 45 to 60 days to respond to homeowner inquiries to the program–a time period during which most could easily lapse on payments, starting a foreclosure process that the very program should be able to prevent. There are even homeowners who have been waiting for nearly half a year on new payment arrangements and continue to remain without answers.

Perhaps this plan should have called for a little enforcement?

Another 2.4 million Americans are at risk of foreclosure, according to the Center for Responsible Lending; 8.1 million more could stand at the same precipice within the next four years.

In regards to these complaints, new modifications may be in the works for the program. Let’s cross our fingers that “banker accountability” will be included within the wording.