By Alexandra Andrews
The Obama administration estimates that it’s going to help as many as 4 million homeowners modify their loans. To date, “over 200,000” of these loan modifications have been offered, according to the Treasury Department. That leaves millions of homeowners waiting their turn.
Deborah Sherman from Oakland, Calif., is somewhere in that queue. She says she applied for a loan modification through the government’s program one day after it was announced on March 4. Since then, she says all she’s heard from Chase, her loan servicer, is: It could take up to 90 days. Please keep waiting.
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She’s still waiting.
Sherman’s story is hardly unique. As we reported in early June, the program got off to a chaotic start as hordes of homeowners nationwide jammed servicers’ phone lines and overwhelmed their staff. Housing counselors and frustrated homeowners reported long delays and mixed messages about eligibility requirements.
Last Tuesday, President Obama expressed disappointment with the program’s progress, saying at a press briefing, “I think … our mortgage program has actually helped to modify mortgages for a lot of people, but it hasn’t been keeping pace with all the foreclosures that are taking place.” Obama said that he gets complaints from homeowners every day and is still asking his staff to tweak the program and make it more aggressive.
His remarks were echoed by Elizabeth Warren, chairwoman of the Congressional Oversight Panel, which oversees the Treasury Department’s response to the financial crisis, and Richard Neiman, superintendent of banks for the state of New York, at a congressional hearing on Wednesday.
At the hearing, Warren and Neiman grilled Herb Allison, the Treasury Department’s bailout overseer, about the administration’s mortgage plan, citing some of the same problems we’ve been hearing. Allison said that it had taken a couple of weeks for the government and the banks to get the program off the ground, but that things are now “moving very rapidly.”
