Loan Modification Sham

From Business Insider:

Mortgage expert and one-time Fannie Mae Chief Credit Officer Edward Pinto blasts the claim that 500,000 homeowners have entered into HAMP (Home Affordable Modification Program).

Based on comments being made by industry participants and program results to date, HAMP is rapidly becoming: I will pretend to modify your loan if you pretend that you will make the payments.

While it’s admirable to try to get large numbers of people involved in programs to “save” their home from foreclosure, it’s also known to those who have worked with people in foreclosure that it is difficult to get paperwork completed in a timely fashion. The 3-5 month trial window allows some “extend and pretend” but I fear this article is correct in stating a very significant percentage of those homes aren’t going to be saved, foreclosure is just going to be delayed.