Thursday, Jun 30, 2016
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Editorials

Mortgage aid lags

LAST YEAR, 11 homes in Lucas County went into foreclosure every day; more than 4,000 in all in what was a microcosm of the national housing crisis. Earlier this year, in an attempt to keep people in their homes here and across America, the federal government instituted a $50 billion program to reduce the mortgage payments of up to 4 million homeowners.

To date, the 38 companies taking part in the program have done what can fairly be described as a lousy job, adjusting the mortgages of only 9 percent of eligible borrowers. There were large disparities even among participating lenders. Loan servicer Saxon Mortgage Services Inc., for example, had begun trials reducing the loan payments of 25 percent of eligible borrowers. Ten other lenders, however, had not adjusted even one loan by the end of July.

While lenders fiddle, the American dream of home ownership continues to go up in flames. Nationwide, about 1.5 million people received foreclosure notices in the first six months of this year. Locally, while foreclosures have been down the last three months, Lucas County still is on pace to top the 2008 total of 4,093.

Nationwide, lenders have made only about 400,000 offers to the 2.7 million qualified homeowners who are more than two months behind on their mortgages, typically adjustable-rate schemes whose interest rates soared into unaffordability.

Not every lender was even willing to join the federal program. Litton Loan Servicing, one of the biggies in Ohio, has kept its distance despite signing a nonbinding agreement with Gov. Ted Strickland in April promising to help struggling Ohio homeowners keep their homes.

A Wells Fargo executive admitted to the Associated Press that his company had "fallen short of our customer service goals," and PNC, which owns National City Bank, said it has loan modifications "in process," but that will be cold comfort to families for whom help arrives too late.

Lenders need to make sure that by the time they get around to mailing offers to eligible borrowers, the notices aren't delivered to empty homes.

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