User talk:Loanrecourse

HAMP Shows No Signs Of Recovery
It is estimated that HAMP would help as many as 4 million mortgagors by giving them the opportunity to avoid foreclosure by modifying the loans. Almost 1.3 mortgagors were granted trial loan modification, but only half a million mortgagors were actually able to receive permanent loan modification. As reported by Home Affordable Modification Program’s (HAMP), for September only 28,000 people received permanent loan modifications. This is less than any time since last September. The high qualification standards of HAMP can be considered a cause for this and may be this is the reason that only 35,000 financially struggling homeowners entered HAMP in September. Moreover, under HAMP, banks have the advantage of denying trial modifications. They can offer a mortgagor either a private loan modification or a foreclosure.

According to a recent report on US Treasury’s Housing Scorecard, the redefault rate for the mortgagors in permanent loan modifications is less than 2% even their debt-income ratios remain very high. It indicates that it becomes easier for the borrowers who get loan modifications to pay their debt back in with modified terms. If these loan modifications are not provided to the borrowers, the home prices will keep on falling.

According to a recent study on the US housing market, a drop in home prices is observed every month. It is because of excessive supply of homes by foreclosures. Data shows that a supply of homes for 11 months is available, and shadow inventory is also there.

Because of these foreclosures and subsequent drop in home prices, the US housing market is facing a continuous downfall. If steps are not taken to check these foreclosures, the housing market will have to face more adversity.