A new online service to help homeowners submit and track the documents needed for a government-backed mortgage loan modification has been launched by HOPE NOW, a coalition of mortgage companies and credit counseling agencies.
The online portal is intended to address what has been a major problem with the Obama Administration's Making Home Affordable foreclosure prevention program. Lenders say that large numbers of borrowers aren't submitting the documentation needed to complete their loan modifications, while homeowners are complaining that lenders are losing the documents they submitted.
"This new web portal will help homeowners get a faster answer, via their housing counselor, on whether or not they qualify for a HAMP (Home Affordable Modification Plan) loan," said Faith Schwartz, executive director of HOPE NOW. "The ability to help at-risk borrowers navigate more quickly through the HAMP modification process is a win-win for borrowers and the servicers committed to this program."
The Hope LoanPort is a free service that will assist homeowners in assembling the necessary documents to apply for a mortgage loan modification, upload the completed application package directly to their mortgage servicer and track the status of their application. Initially, a counselor from a HUD counseling agency will assist homeowners in assembling and submitting their materials, although Schwartz said that eventually homeowners will be able to access the system directly.
Track progress of loan mod application
The portal will enable homeowners to track the progress of their application and obtain regular updates. The lack of updates has been a source of frustration for many homeowners seeking loan modifications under the Making Home Affordable Program.
Schwartz said the portal should reduce the time it takes for borrower's applications to be approved or denied, and should reduce servicers costs as well. Also, it's hoped that providing a single point of entry into the system will help the mortgage industry and the government identify bottlenecks in the program and take steps to eliminate them.
At least six mortgage servicers are participating in the initial roll-out of the program, American Home Mortgage Servicing, Inc., JP Morgan Chase Manhattan, GMAC Financial Services, SunTrust, PNC Mortgage and Saxon Mortgage. Together, they represent about 25 percent of all U.S. home mortgages.
HUD-approved credit counseling agencies participating in the first phase of the program are Neighborhood Housing Services(NHS) of Chicago, NHS of Greater Cleveland, NHS of New York City and Cabrillo Economic Development Corporationin Ventura, Calif., as well as their affiliates in Kansas City, West Palm Beach, Washington, DC, and Atlanta. Eventually, HOPE NOW intends for the system to be available nationwide with most servicers.
Financially stressed homeowners living in these communities and with mortgages serviced by the six firms named above may contact the participating credit counseling agency in their area to start the loan modification process. More information and a self-assessment to determine eligibility for the Making Home Affordable Program are available on the Hope Now web site.