by Paul Kiel, ProPublica
This article was published by ProPublica.
New data released by the Treasury Department on Wednesday shows that mortgage servicers booted about 68,000 homeowners from the government’s mortgage modification program in March: That’s more than the 61,000 homeowners who began a permanent modification last month. Homeowners are eligible to receive the permanent modification after a trial period that is supposed to last three months.
We
reported in February that a jump in disqualifications was expected. That rise is now upon us. Homeowners can be dropped from the program if they can’t keep up with their reduced payments, they don’t provide needed documents, or the servicers determine that they are ineligible.
Some 367,000 homeowners remain in limbo, stuck in trial periods that have lasted longer than they are supposed to. One silver lining: the current number of permanent modifications, 228,000, is still greater than the number of homeowners who’ve been dropped from the program, 158,000.
You can see our
interactive breakdown of the data here. It shows the cancellations at each servicer, as well as which servicers (the biggest banks) are primarily responsible for the continued logjam.
As we’ve reported, delays and confusion on the part of servicers have been a reality for homeowners since the program started a year ago. Treasury has
promised to crack down on servicers like JPMorgan Chase that strand homeowners in trials, but the backlog continues. As of last July, Chase had begun 79,000 trials. By the end of March, it had reported final resolutions for only 57,000 (31,000 permanent modifications, the rest canceled). That means 22,000 homeowners still hadn’t gotten an answer after eight months.
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