Changes in the home loan modification reports that offered data about servicer performance has led some homeowners to feel that, for major financial institutions like Bank of America, the new rating system could lead to better performance in the future, despite the fact that there were increases made by Bank of America in the area of permanent home loan modification programs which were reported on in data released here in June.
According to the Treasury Department, Bank of America saw an increase in the number of active permanent modifications they had from March to April, which went from 107,010 permanent modifications to 109,827, and Bank of America is not the only financial institution that was able to report increases in their permanent modification programs. Homeowners have, obviously, been seeking out permanent modifications over the past year or more and, for a financial giant like Bank of America, there are numerous homeowners who are in a position where delinquency has led to the need for foreclosure prevention assistance.
However, Bank of America is just one of the many financial institutions working in HAMP who has been heavily criticized by officials and homeowners, but this is nothing that is necessarily confined to the major banks, as numerous homeowners have had problems with not only making payments in the federal modification program, but proprietary home loan plans from a variety of institutions as well. Yet, Bank of America was one of the lenders that reportedly requires a great deal of improvement in their home loan modification efforts within HAMP and, unless changes are made, it has been stated that this particular bank may not receive certain incentives that are usually given to participants in this foreclosure program federal program.
There are factors like unemployment which are beyond the control of many of these financial institutions, which have led many homeowners to either find that their modification payment is still too expensive or there are cases where homeowners simply default once again when they have been given a modified home payment. Obviously, factors like this are beyond not only the ability of some banks, in terms of preventing foreclosure, but there are some homeowners who are simply in a position where mortgage modifications will not help.
What many homeowners hope will come of these new rating systems though, is that where Bank of America or any other financial institution is lacking in certain areas of their modification efforts, it will be corrected and potentially lead to more home loan modifications overall. While there are issues that have led to lackluster results in the modification program that stem from banks, the program in general, or some problems are simply the fault of the homeowner, it’s hoped that even though Bank of America and other servicers are still seeing increases in the number of active permanent modifications, changes to their implementation of these foreclosure prevention plans will lead to more success and fewer foreclosures in the future.