Bank of America has been one of the top lenders in the Making Home Affordable Program over the past months and has offered a variety of homeowners a permanent home loan modification, which have helped many keep their home. Modifications have been a primary way in which homeowners have avoided the loss of their home by reducing their monthly mortgage payments.
There are increases in the number of permanent home loan modifications that have been made over the past months but many servicers have seen a decrease in the number of trial modifications that are currently in place. For instance, Bank of America had 121,369 active trial modifications according to the June Making Home Affordable servicer report. However, in July, that number dropped to 84,741 trial modifications that were currently active at the time the report was released.
Bank of America was one of the mortgage servicers that did see an increase in the number of permanent home loan modifications but many servicers have seen big drops in the trial modifications in their charge. Many worry that mortgage servicers are simply disqualifying homeowners and not allowing those who are struggling the opportunity to receive a permanent modification, which may potentially save their home.
While there have been difficulties between lenders and homeowners, with accusations from both sides about why home loan modification numbers are not higher, there are concerns over homeowners’s ability to make payments even with a modification. Some homeowners accused mortgage servicers of not doing all they can to help troubled homeowners but lenders say some homeowners simply do not qualify for a modification or do not file the proper paperwork.
What concerns many is that there are homeowners who are still becoming delinquent or defaulting even with a trial home loan modification in place. While Bank of America does offer alternative mortgage assistance plans, many worry that the slow job market and poor economy are hindering many of these assistance programs from working properly.
Bank of America does offer in-house mortgage assistance plans and foreclosure alternative options to homeowners but there are also extension programs from the Making Home Affordable Program, specifically like those for homeowners who are unemployed, that may also be of assistance. Traditional modifications may not help every homeowner but with more options now available there may be alternate ways for homeowners to get a more affordable mortgage payment outside of the modification program or with extension HAMP plans.