J.P. Morgan Home Loan Modification Program–Are Lenders Using Obama HAMP To Help Homeowners?

On June 24 the Committee on Oversight and Government Reform held a meeting in which top lenders within the Making Home Affordable Program testified about their participation and the programs they have been using to help homeowners who are struggling with their mortgage payments. David Lowman, the CEO for Home Lending at J.P. Morgan Chase was present and gave a testimony regarding his company’s participation and work within the modification program.

There have been many criticisms levied against mortgage lenders and J.P. Morgan Chase has not escaped these biting comments from various homeowners who are angry and frustrated about their experience within the modification program with Chase. However, J.P. Morgan Home Lending CEO David Lowman stated that Chase has been making strides in modification and mortgage assistance programs for homeowners in various situations.

For instance, Mr. Lowman stated that from 2009 through May of 2010 Chase has offered over 846,000 modifications for troubled homeowners. He also said that 172,000 permit modifications under the Home Affordable Modification Program have been completed. Like many other lenders, Mr. Loman said that this number was a result of programs from both governmental plans and Chase’s own modification programs.

Again, there have been many complaints levied against Chase, along with other lenders, but Mr. Loman cited that obtaining proper documentation from homeowners was one of the driving troubles that J.P. Morgan Chase was having. However, it was also said that on average homeowners receive a payment reduction of $535 through the home loan modification program.

Also, additional help for homeowners outside of traditional modifications is also available for J.P. Morgan Chase homeowners. Programs such as the Second Lien Modification Program, unemployment forbearance plans, and an appeals process for homeowners who were denied a modification are all being used by J.P. Morgan Chase to help homeowners both avoid foreclosure and make their home loan payment more affordable.

When it comes to homeowners looking for alternatives to foreclosure, Mr. Loman mentioned that principal reductions were not something that J.P. Morgan Chase felt should widely be used, but homeowners did have options through short sales and Deed In Lieu of Foreclosure programs.

He went on to say that a decline in income seems to be the number one problem among homeowners but J.P. Morgan Chase is still working to provide customized solutions for homeowners who are in need of mortgage assistance plans that are tailored specifically for those who may be suffering from troubles like unemployment.

While short sell options, deferments, and even customized payment plans have been used there are still troubles with homeowners who are seeking some form of mortgage assistance. However, despite stories from angry homeowners and criticism of both the Making Home Affordable Program and lenders themselves, homeowners are still being prompted to talk with their mortgage lender if they are in need of home loan assistance as there are various options which may be used to keep someone in their home.