The federal government has helped more than 66,000 homeowners stave off foreclosure by modifying their mortgages, a sliver of the goal President Obama announced when he introduced the program almost a year ago.
His administration had set a goal of offering between 3 million and 4 million lower mortgage payments via loan modification by 2012.
In the Washington area, the Home Assistance Modification Program had eased 2,500 loans through December, with about 27,000 more mortgages in trial modifications. Through the program, struggling homeowners receive temporary modifications, which become permanent after they make three payments on time and complete the required documentation.
Borrowers have saved more than $1.5 billion through the program, according to the Treasury Department, with homeowners saving an average of $500 a month.
But another 49,000, or more than 5 percent, have dropped out.
Homeowner advocates are calling for swifter action, as millions across the country risk losing their homes.
The approximately 100,000 permanent modifications given or pending is “obviously a very positive development,” said David Berenbaum, chief program officer of the National Community Reinvestment Coalition.
Still, the program needs “serious review,” he said.
“HAMP has really not reached its potential,” he said, pointing to the 2.8 million homes that went into foreclosure last year.
The Obama administration has moved to lift the cap on aid to mortgage giants Fannie Mae and Freddie Mac, which could pave the way for the giant mortgage lenders to help more people refinance and lower their monthly payments.
Some lawmakers are wary. A bipartisan group of congressmen, led by Rep. Darrell Issa, R-Calif., has called for the appointment of an inspector general for the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac.
“Fannie and Freddie have become the largest taxpayer bailout in American history. It defies common sense to leave them without proper oversight while the federal government keeps giving them unlimited access to its ATM card,” Issa said.
