How To Improve Loan Modifications
I don’t know why they don’t go back to the Hope for Homeowners loan if they are going to loan modifications. The Hope for Homeowners in a nutshell is a new loan at 90% of the current appraised value. If you are going to do loan modifications I think this is the way to go because the appreciation is shared with the government, it would be a mortgage manageable payment, it’s a fixed rate loan, and now the borrower isn’t upside down. Anyway, you can decided.
“The first shortfall is that the program doesn’t provide a clear process to triage the over 7.5 million delinquent loans. The second is that it doesn’t take into account that the primary reason borrowers default is “negative equity.” When a house is worth less than what is owed on it, making monthly payments seems like a waste of money and many homeowners walk away.”