Why won’t lenders renegotiate delinquent home loans?

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investorzzo's picture
investorzzo
Status: Diamond Member (Offline)
Joined: Nov 7 2008
Posts: 1182
Why won’t lenders renegotiate delinquent home loans?

http://www.consumerwarningnetwork.com/2009/08/04/why-wont-lenders-renego...

Banks Don’t Really Want to Help

None of this is surprising news to the Consumer Warning Network. You can read our many stories about the loan modification problem (here, here and here). Our research over the past two years shows the notion that banks want to help homeowners modify loans to avoid foreclosure is simply a myth.  One that’s been nurtured by these companies, despite the facts that stand in direct conflict.
Complaints to CWN continue unabated from homeowners unable to get their lenders to work with them. Everyone tells the same story. “I’ve tried for months and months to get my lender to talk to me about renegotiating my loan so we both can avoid foreclosure, but all I get is either a dial tone or a big run-around.”

Although the plan was touted as providing much needed help to between 7 and 9 million eligible homeowners, very few citizens have actually been able to obtain a renegotiated loan under the program. Although the government is not releasing detailed statistics, it has announced that 200,000 modifications have been offered to date, but admits that only “tens of thousands” of loan modifications have actually been approved under the program. That’s not even one percent of the stated goal, a miserable record indeed! What happened?

horstfam's picture
horstfam
Status: Bronze Member (Offline)
Joined: Sep 6 2008
Posts: 71
Re: Why won’t lenders renegotiate delinquent home loans?

I just heard my first local report (south Florida) of a mortgage reduction. An acquaintance had his mortgage reduced by $60,000. This was only achieved after multiple contacts with three mortgage companies (his mortgage was sold/merged with other companies) over several months. I didn't find out any of the minute details.

In our area, the peak was January 2006 with a median house price of $322,000. In June 2009, it was $87,000. So, we've come down a bit here. What about in your neck of the woods? Any other similar reports?

Incidentally, he has told many people of this reduction and no one he has told has heard of any others, so far.

 

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