How badly are the government’s loan modifications doing?
Here’s the money shot from NYT reporter Floyd Norris’s investigation earlier this week:
Chase disclosed in November that:
- nearly a quarter of trial modifications had failed because the borrower did not make even a single payment
- nearly half had failed to make all three payments required before the modification could become permanent.
- Of those who had made all three payments, only about a quarter had submitted all the required documents.
Add all that up and approximately 25% 12.5% of applicants are making it through the loan-mod trial period.
So what’s the real reason the mods aren’t working? Because the loans never should have been made in the first place.