Industry NewsMortgage

Loan mod ‘insanity’

Inept practices undermine housing recovery

Learn the New Luxury Playbook at Luxury Connect | October 18-19 at the Beverly Hills Hotel

While I applaud President Barack Obama's plan to rescue the housing market through the restructuring of distressed mortgages, the current landscape of loan modifications appears to be something of a bad joke, littered with inept, if not fraudulent, practices by some loan servicers. "Insanity" is the word Jay Meadows uses to describe current loan modification efforts. "Let's do the same thing over and over again and expect a different result," exclaims Meadows, CEO of Fort Worth, Texas-based Rapid Reporting."The people who we have talked to about re-mods, for the most part, are doing the exact thing they did to create the original loan. And the bottom line is, in a re-mod situation, we have already proven that the people (homeowners) can't pay for the house they are in." Actually, if servicers were just doing the same thing over and over again that would be a step in the right direction. Instead, the re-mods can make things worse for the borrower...