Home loan modification has become almost the only option to refinance for those who are in distress. The HAMP Loan modification program of the US Government which is short for Home Affordable Modification Program is the Obama administration's efforts to see if with the resources of the Federal government there's anything that can be done to launch a loan modification program for US homeowners that actually works. Today the jury is still out that this is going to work to any extent that really makes a difference.
It's a very good plan in theory and the intent of what policy makers want to achieve are admirable, the implementation to date has left a lot to be desired and that's putting it the nicest way possible. According to the government's own stats, there are between 11 and 12 million homeowners who need the support of the home affordable modification program. At the same time and now after almost 2 years of working with it, less than 400 thousand have received a home loan modification and not all of those have been successful. Like so many programs tried by the Federal government, particularly when it comes to domestic issues, are good in theory but leave a lot to be desired when it comes to execution.
This is a damn shame. There's nothing more heartbreaking that seeing a struggling family lose their home due primarily to circumstances way outside of their control. What is referred to as "traditional home refinance" just won't work when it comes to a distressed property. It takes the US Congress mandated provisions of the HAMP Loan Modification legislation to provide the tools needed to make the basic, deep changes needed to a mortgage in distress to return it to one that can be paid by the debt holder.
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