Statements coming from mortgage industry watchdogs, around the nation, indicate that all is not well for homeowners, faced with foreclosure needing to restructure and modify their mortgages. Banks and Loan Servicers are experiencing a backlog of mortgage modification applications as an ever increasing number of homeowners queue up to participate in the government supported program. Banks and Loan Servicers had only recently downsized their staffs in their efforts to stay afloat.
As Loan Servicers struggle to keep up with the increasing volume of applications, and their desire not to end up playing landlord for vacant, vandalized and deteriorating properties, the focus seem to be to assist the most troubled of homeowners - those with the sub prime loans. This development places prime borrowers on a slower track to mortgage modification and loan restructuring.
According to report by Paul Jackson, writing in housingwire.com,"During February, 39.7 percent of loan workouts for prime borrowers were loan modifications; in contrast 66.5 percent of subprime workouts were loan modifications ."
This situation does not augur well for the homeowner who is running out of time or the Loan Servicer who may end up doing exactly what they are not qualified or want to do - landlording vacant, vandalized and deteriorating properties.
Our next post will look at the impact this development is having on both the homeowner and the Loan Servicer Banks.
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