Making Home Affordable: Lenders asked to become

more responsive

By Jan Lindsey

Since the federal program Making Home Affordable  launched in March, 325,000 homeowners have received assistance, said William Apgar, Senior Advisor for Mortgage Finance at the U.S. Department of Housing and Urban Development.

But it hasn’t always been easy.

“As with any new program, we have encountered a few difficulties in launching the Make Home Affordable program,” a transcript shows Apgar told the U.S. Senate Committee on Banking, Housing and Urban Affairs on July 16. “Many consumers have had trouble reaching their servicers and receiving a timely response from servicers after they have submitted applications for (loan) modification. Other consumers have complained of receiving inaccurate or misleading information from (loan) servicers.”

HUD Secretary Shaun Donovan and Secretary of the Treasury Timothy Geithner sent letters to the CEOs of the financial institutions participating in the program urging them to add servicing capacity and improve the quality of their processes in order to help more people, Apgar said.

Each was also asked to designate a senior official to serve as liaison to the Obama administration and to work with HUD and the Treasury department.

Twenty-seven servicers – more than 85 percent of the market – are participating in the program, he told senators. By early August, he said, the success each servicer has realized through the program will be made public.

In the meantime, federal officials are considering ways to help mortgage loan servicers use their relationships with nonprofits and other entities to expedite processing and approval of mortgage loan modification applications, he said.

HUD and the Treasury department would like to see a network of advisors created to guide borrowers through the application process, helping them to prepare application packages and troubleshooting if the borrower appears to have been inappropriately deemed ineligible, he said.

And, he said, the federal agencies are working with the Homeownership Preservation Foundation, a partner in the Hope Now program, to better train housing counselors to resolve complaints against servicers.