This explains a lot about loan modifications…. (maybe)
After hearing a LOT of anecdotal evidence suggesting that mortgage servicers are making decisions that seem to run contrary to the “desire” to keep people in their homes, we now have a more “structured” glimpse into why that seems to be so:
- Because it’s true.
- The report by the National Consumer Law Center said that their study shows that servicers make more money (or lose less money) if they foreclose rather than modify mortgages.
How did they figure that out? Follow the money.
But also, ask yourself is there an agenda behind the National Consumer Law Center to manipulate the data?
It does “mesh” with what I’ve heard, but that doesn’t mean it’s a fact yet…..
Tom Vanderwell
Servicers Prefer Foreclosure, Says NCLC : HousingWire || financial news for the mortgage market
Mortgage servicers have found it cheaper to foreclose on homeowners than offer loan modifications, according to a new report from the National Consumer Law Center.The report points out servicers in charge of modifying distressed loans are separate from the lenders, who have packaged the loans and sold them in pieces or pools to other banks and investors.
“In the majority of cases, servicers have nothing to do with what’s in the best interest of those investors,” said Diane Thompson, the author of the report and attorney at the NCLC. “We figured this out by following the money, by following who plays what role in all of these business transactions and who gets paid what for doing what.”
Technorati Tags: Foreclosures, Loan Modifications
