The mortgage-industry effort to stem foreclosures aims to double the number of borrowers getting help next year, as Democrats call for using taxpayer money to address the crisis. The Hope Now Alliance, a group created at the behest of Treasury Secretary Henry Paulson last year, expects to modify about 2 million mortgages next year, according to a report to be released today in Washington. The group, which includes JPMorgan Chase & Co., Citigroup Inc. and Bank of America Corp., also plans a new campaign to boost participation in the program.
Hope Now projects 950,000 loan modifications for 2008, including 208,000 for the month of November. Including repayment plans and other assistance, the group estimates that about 2.2 million foreclosures will have been prevented this year, bringing to 3 million the total averted since the program began in 2007.
Source: Bloomberg.com
REAL Trends Comment: While modification of troubled mortgages may be good social policy it is evident that loans being modified are becoming delinquent at much higher rates than predicted. (See article below). While it may be that policy makers and large mortgage lenders who are participating in the Hope Now Alliance are merely trying to engineer a 'soft"
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