Citigroup CitiMortgage Home Loan Modification Program Sees Bankruptcy Increase For Homeowners Denied Assistance

Citigroup modification assistance from both the federal home loan modification program and proprietary modification plans have been in place and aided numerous homeowners over the past months, but there are still problems with homeowners who are attempting to find assistance through the federal modification program. Citigroup has been able to lower some homeowners’s monthly mortgage payments through modification efforts but there are problems with homeowners falling into bankruptcy when they are either denied a trial modification or have their trial modification canceled.

A recent report from the Making Home Affordable Program stated that Citigroup’s CitiMortgage division had 3,912 homeowners who were in the process of bankruptcy after having their trial modification canceled. This tracks data through October 2010, and the previous month’s report stated that this same group of homeowners who had their trial canceled numbered at 3,579. Also, homeowners who were not offered a trial modification had bankruptcy issues as well as it was reported that 7,736 homeowners were the process of bankruptcy in this category, as of October 2010, while the previous month stated that only 6,910 homeowners who were denied a trial modification where the process of filing bankruptcy.

Obviously, there are numerous financial institutions who have seen these issues arise when homeowners are either unable to continue in their trial modification or simply do not qualify. However, there are still options for homeowners outside a federal mortgage assistance plans, like proprietary modifications and extension programs to address particular homeowner needs which may be causing financial strain when it comes to meeting their mortgage payments.

Servicers like Citigroup have seen success in the number of federal permanent modifications they made throughout 2010, but reports have indicated that these efforts have begun to slow in relation to the number of homeowners who are facing foreclosure. Understandably, homeowners have been critical of the modification program and many servicers, as they have grown frustrated at the modification process and being denied assistance which could offer them a lower monthly mortgage payment. However, servicers have countered with arguments stating that some homeowners who do not qualify for a home loan modification program or do not properly adhere to application requirements and are therefore disqualified.

Yet, despite the troubles that remain, homeowners with Citigroup and other financial institutions in the Making Home Affordable Program do still have options when it comes to finding affordability on their mortgage payments and there are also proprietary home loan assistance plans from in-house initiatives available to help homeowners who may not qualify for a federal assistance plan.