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Freddie Mac to Visit Homeowners in Person to Help Them Apply for Federal Loan Modification Program

October 1, 2009

Our San Bernardino loan modification attorneys were encouraged to see that federally backed mortgage company Freddie Mac is planning a more active step to help homeowners qualify for loan modifications. According to a Sept. 29 post on the L.A. Land blog from the Los Angeles Times, Freddie Mac has hired a private company to send people to the doorsteps of Freddie Mac mortgage holders who may need help applying. The company is touting the government's Home Affordable Modification Program, which allows qualifying borrowers to change the terms their loans to address a new financial situation that makes the old terms too onerous.

The door-to-door representatives will visit Freddie Mac mortgage holders who are at least 31 days late paying their mortgages but have not completed paperwork to apply for HAMP or filed for bankruptcy. According to a spokeswoman for Freddie Mac, the goal is to give homeowners the same kind of personal help they had when they first applied for their loans, helping with paperwork and to overcome procedural blocks. To avoid imitators trying to commit loan modification fraud, no representative will accept money from borrowers, but they will carry copies of letters the homeowners should have received from Freddie Mac. It's unclear how many people in Southern California could benefit from the program, but the Times said 3.14% of Freddie Mac's loans nationwide are at least 90 days behind.

As Westminster loan modification lawyers, we hope Freddie Mac's intervention will improve the success of the federal loan modification program. HAMP has gotten off to an extremely slow start, with an August report showing that just 12% of eligible borrowers had started modifications that month. After reading extensively about the problems, we believe the problem is driven by lenders' own reluctance to lose money in the short term, rather than the personnel shortages and disorganization they tend to cite. Even though foreclosing is likely to be more expensive in the long run, not least because of the bad housing market, one study showed banks would rather disguise those losses on their balance sheets or sit on foreclosed properties than help homeowners. If active intervention by Freddie Mac helps some of these homeowners cut through red tape, excuses and incorrect denials, we wish them the best of luck.

Howard Law LLP has an active practice helping homeowners who believe they can hold on to their homes if they can lower their monthly payments. Our Lakewood loan modification attorneys have a strong record of getting action from lenders, a success we attribute in part to our status as attorneys. We review each new case we take for evidence of predatory lending or other violations of our clients' rights -- and if we find such evidence, we can and will file a lawsuit. This gets lenders' attention very quickly -- even in many cases where homeowners tried unsuccessfully for months to get a modification on their own. Our goal is not necessarily to sue, but to get our clients loan workouts that allow them to stay in their homes for good.

If you're struggling to get your loan modification request taken seriously and you're ready to get help, you should call Howard Law right away. To set up a free, confidential evaluation of your case, please contact us online or call 1-800-872-5925 toll-free.