Over 360,000 borrowers have taken advantage of Fed’s Loan Modification Program

Dennis Norman

By: Dennis Norman

Earlier this week the Treasury Department released it’s eight “Tranche” report updating the status of the TARP (Troubled Asset Relief Program) which includes the Home Affordable Modification Programthat I have written about on several occasions. The report shows that progress is being made with regard to loan modifications with $27.07 billion, of the $50 billion available) committed to loan modifications through September 30, 2009 (see “HAMP” details on chart below).

According to the report, through the end of August, 2009, lenders have sent 1,883,108 requests for financial information to borrowers (to determine if eligible for a loan modification) and, as a result of information received, have extended a trial period for loan modification to 571,354 borrowers. Through August 31, 2009 there have been 360,165 Trial loan modifications started. 

The Treasury Department is also reporting that it has reached agreements with 63 loan servicers to extend the loan modification program to loans they own or owned by other investors, but not owned or guaranteed by Fannie Mae or Freddie Mac (which are already covered by this program). From the best I can tell from the report, it appears there are only two lenders in the St. Louis area that have signed the agreement, First Bank (with a cap of just under $5 million for loan mods) and CitiMortgage (with a cap of almost $2.1 billion for loan mods).  As a result of these agreements, more than 85 percent of all mortgage loans in the U.S. are now covered by the Making Home Affordable Program.