Thursday, October 11, 2007
Survey Results Show Lenders Not Helping Borrowers Keep Their Homes - Press Release: "Only one mortgage counselor reported in CRC's survey that loan modification was a very common outcome presented to borrowers. In fact, counselors reported that the industry as a whole is not consistently modifying loans for long-term affordability, as they claim. When lenders do modify loans for borrowers in early delinquency, or facing unaffordable rate resets, survey results show they are not offering fixed rates for the long term. Counseling groups responded that lenders are only willing to fix interest rates for one year at a time. These short-term modifications are unlikely to solve borrowers' problems, and will most likely only delay the situation, Stein says. CRC's survey also revealed that most counseling agencies do not see lenders reaching out to borrowers before they face problems from rising rates and monthly payments. A surprising 24 of the 33 respondents said that in their experience, the industry as a whole is not contacting borrowers before delinquency."