More and more homeowners are dropping out of the HAMP Loan Modification Program.
Some numbers:
- 436,000 have been disqualified or dropped from the program.
- 155,000 participants left the program in May 2010.
- With over 1.5 million applicants, only 340,000 have received permanent solutions.
The "permanent solutions" mean these applicants received a permanent change to their loan terms. In most cases it means a lower monthly payment. The question to ask...
"Is it enough?"
If past history is any guide the answer is "no!".
A large majority of homeowners who received a loan modification in the past 2 year fall back into default.
According to credit.com, a new report expects 75% of homeowners who receive a permanent loan modification will default again within one year.
Only 25% of the 340,000 are expected to make payments for the next year? That's only 85,000 homes remaining in the program after one year. This is only 6-8% of the total number of applicants. That leaves 90+% of distressed homeowners scrambling for answers after the failed loan modification.
Let's just say there may be a better way to spend $75 billion.
