To no one’s surprise – well, maybe Barney Frank and Christopher Dodd were surprised – President Obama’s vaunted mortgage modification program is a colossal failure.
Forbes.com has the depressing details:
More than a third of the 1.24 million borrowers who have enrolled in the $75 billion mortgage modification program have dropped out. That exceeds the number of people who have managed to have their loan payments reduced to help them keep their homes.
But analysts expect the majority will still wind up in foreclosure and that could slow the broader economic recovery.
A major reason so many have fallen out of the program is the Obama administration initially pressured banks to sign up borrowers without insisting first on proof of their income. When banks later moved to collect the information, many troubled homeowners were disqualified or dropped out.
Many borrowers complained that the banks lost their documents. The industry said borrowers weren’t sending back the necessary paperwork.
“The bank lost my paperwork.” Translation? “This bank is prejudiced. They discriminate against deadbeats like me who have neither the means nor intention to pay them back.”
Source: Forbes
