The Mortgage Bankers Association reported that last year's houses in foreclosure total in the U.S. had tied the highest number on record despite several federally-supported programs meant to prevent this scenario from occurring. A number of analysts have asserted that federal programs were ineffective and did not do much in helping homeowners keep their properties.
Some housing industry analysts have argued that federal programs meant to lower the number of foreclosures and bankruptcy homes for sale in the country have failed to do that. They also went so far as to say that people who were meant to be aided by these housing initiatives ended in worse conditions than if the programs were not implemented in the first place.
The programs meant to prevent homeowners from losing their homes to foreclosures or having their houses converted into a distressed foreclosed property on sale failed miserably, according to critics. The loan modification initiative was the one mostly criticized by a number of housing experts. The modification program was earlier projected to have the ability to assist up to 4 million homeowners in the U.S.
However, after two years of existence, only half a million Americans with houses in foreclosure were able to benefit from the initiative. The Treasury Department has reportedly argued that 500,000 is still a good number since that means half a million Americans were able to keep their homes. However, critics argued that there are even more people whose applications got rejected, with most of them ending in foreclosure even though they should not have.
Those who have criticized the loan modification program of the government have cited one primary weakness in the initiative. They stated that even though the program was a federal one, banks were still allowed to decide who will qualify for assistance. This, critics stated, resulted in more bank owned property foreclosures as lenders rejected supposedly qualified applicants, often after months of allegedly making them believe that they will get accepted.
Most analysts who criticized government initiatives stated that the fault was in the poor design of the programs and the alleged failure of the Treasury Department to effectively oversee the initiatives. They also stated that a big number of properties still ended as houses in foreclosure because compliance was not given much attention.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.
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