A new review process by Fannie Mae and proposed changes from Freddie Mac concerning methods used by servicers to assist homeowners who have been seeking home loan assistance but have had trouble are hoped to bring about better results from not only the home loan modification program, but the way servicers deal with homeowners who are in need of financial assistance, foreclosure prevention, and simple recovery that may have been the result of the recession or property devaluation.
According to HousingWire.com, Fannie Mae is set to implement a new program that will evaluate how mortgage servicers are performing when it comes to foreclosure prevention efforts and general assistance to help homeowners avoid the loss of their home, and Freddie Mac will also use a similar program that will rate performance of various financial institutions, which could lead to incentives and rewards for companies that help homeowners during these difficult financial times in the housing market.
There have been a wide range of complaints against financial institutions in the past months as many homeowners have been unhappy with their servicer’s participation in the Making Home Affordable Program and other foreclosure prevention efforts. While many of these big banks have seen success in terms of the number of modifications they have made, there are those who feel that servicers are either not working at a pace fast enough to help homeowners, have not seen enough success to warrant any praise, or have simply denied homeowners the assistance that could have prevented the loss of their home through improper implementation of modification programs and foreclosure practices.
Essentially, mortgage servicers have seen increases in the number of permanent modifications they have made, but many officials and homeowners feel that these numbers could have been much higher had these financial institutions properly conducted modification programs and foreclosure reviews. There is still a great deal of anger towards the banks who were accused of “robo-signing” during the foreclosure scandal a few months ago, yet, there are still questions as to whether factors like unemployment could also be attributing to the lackluster performance that have been seen in modification efforts and widespread foreclosures that are still occurring across the nation.
There are some officials who have called for the termination of federal modification efforts, as proprietary home loan modification plans directly from many mortgage servicers have seen more success, but there are some who feel that transparency in the practices of mortgage servicers related to the foreclosure prevention efforts could be more helpful in either pointing out problems within the program, problems related to a servicer’s implementation of the modification plan, and ultimately could lead to changes that may make foreclosure prevention efforts more successful.