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Mortgage modification underway

By Jeanie Powell - bio | email

HUNTSVILLE, AL (WAFF) - The Mortgage Modification Conversion Drive has begun.

It's an effort by Housing and Urban Development and President Obama to help homeowners who feel they can't keep their head above water.

One professional said local lenders might begin implementing more loan modification programs, but only time will tell how successful this new campaign will be.

The Treasury Department and HUD have announced their partnership to help borrowers in the trial phase of their modified mortgages under the Obama administration's Home Affordable Modification Program (HAMP), convert to permanent ones.

A government-assisted loan modification is something mortgage advisor Simon Weesner said is difficult to do.

Weesner, of 1st Family Mortgage in Huntsville, said, "I'd say if anyone even attempted to do a loan modification after hitting the brick walls I've heard customers first hand tell me they would hit when attempting to do a loan modification, if they could finance through traditional means they would."

This campaign's goal is to make that conversion easier for certain struggling homeowners.

Kelly Stults is a board member of the Huntsville/Madison County Mortgage Bankers Association.

She said, "I think what you'll see more of is easier ways to modify from those loans so home buyers can save money monthly and in the long run too."

She added, "I think a lot of people really just wanted to be homeowners and a lot of times didn't have the credit or the income so they got themselves into arms that maybe had higher interest rates from lenders who are willing to do the loan for them, so I think what really's going to be good is to be able to convert from those sub prime mortgages into something more affordable."

Weesner said this won't have much impact in Huntsville because of a more stable market.

"Huntsville and Madison County really isn't going to be affected by this much at all," he said. "For one, we really were a part of that housing bubble, so we didn't see a lot inflated housing prices."

Stults said if you're concerned about your mortgage, talk to your lender.

She advised going to the Board of Realtors, Mortgage Bankers Association, or Builders Association for an answer to some of your questions.

Meanwhile, Stults provided promising news on the foreclosure rate in Madison County. 

She said in October, only one house out of 19,610 in Madison County was foreclosed upon.

Madison County is looking at an 11% foreclosure rate right now, as is the state of Alabama.

The nation sits at a 26% foreclosure rate.

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