Housing Action Illinois Says Mortgage Loan Servicers Need To Be Held Accountable
A new report released today by Housing Action Illinois provides additional evidence to support the position that mortgage loan servicers in the Chicago metropolitan area are:
- Not agreeing to affordable loan modifications for the great majority of homeowners facing foreclosure.
- Not committing sufficient resources to respond to homeowners in an accurate and timely manner as required by the directives for the Home Affordable Modification (HAMP) program and other federal loan modification programs.
"Servicers are not doing enough to work with homeowners facing foreclosure even when they are being assisted by a housing counselor,” said Katie Gottschall Donohue, Director of Technical Assistance for Housing Action Illinois. “Unfortunately these results were not surprising."
The report was completed as part of Housing Action Illinois’ Servicer Accountability Initiative (SAI), which collected data on cases from 661 individual homeowners working with one of ten HUD-certified counseling agencies in the Chicago metro area between December 2009 and September 2010.
For ten different servicers, Housing Action compiled the number of cases that were approved and denied for a loan modification, as well as the number of pending applications. Four servicers accounted for 80% of all total cases: Bank of America (31%), JP Morgan Chase (22%), Wells Fargo (14%), and CitiFinancial (13%).
Of the 516 loan modification applications submitted, 44% were approved, 16% were denied and 40% of the applications were still pending as of the end of September. However, when the counselor indicated what type of modification was provided, they were overwhelmingly Home Affordable Modification Program (HAMP) temporary loan modifications, not permanent loan modifications.
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Click here to download the report.