The Federal Government is looking to increase pressure on many mortgage lenders and banks to follow through with the loan modification that began under the ‘Making Homes Affordable Program‘. In the program borrowers renegotiate their monthly payments to a lower level for a trial period. If they can successfully pay that lower amount the bank should make it permanent. When the lender permanently modifies a loan they receive a payment form the Government.
However Assistant Treasury Secretary Michael Barr says lenders are taking too long to make those new terms permanent. Currently the government says 375,000 homeowners have cut cheaper temporary deals with their mortgage companies. Borrowers are saving an average $576 a month. The impact on the local market may vary. If homeowners can permanently modify their mortgage and stay in their homes it will reduce the number of foreclosures up for sale and help stabilize the property values. As a Cincinnati Realtor the reduction in foreclosures is a key concern. I want to see families stay in their homes and negotiate affordable rates with their banks.