Monday, February 9, 2009

Mortgage Modification Update

We have been following New Jersey's mortgage modification program since it was announced. We often complained about the programs limited hours and staff levels. Now we read that the staff levels are up - so someone is hiring in this economy! Newsday has an article titled NJ hires help for unemployment, mortgage hot line. The article also gives us a glimpse at how the program is working. Lets take a look -

The economy has been in a recession since December 2007, a downturn marked by plunging home prices, the most severe financial crisis since the Great Depression, and 2.6 million job cuts last year.

New Jersey's foreclosure hot line has also had a hard time keeping up with the phones and has hired a handful of new temporary workers.

The free line opened Jan. 5 to connect homeowners with certified housing counselors in a bid to help people keep their homes. Within the first week, it received more than 12,000 calls.

Of the 12,000 that called, nearly 1,000 have been contacted by the hot line operators and nearly a quarter of those have been referred to mortgage counselors
, according to Dawn Miller, who oversees the hot line.

Average wait times run 15 to 20 minutes, she said.

The easiest way to file a claim is online, Smith and Miller said.

"We've created an interactive Web site for people who can't stay on the phone and hang on," Miller said.

But remember that the website does not appear to be encrypted. Is that better than waiting for 15-20 minutes to talk to someone?

And lets take a look at the numbers - 12,000 calls with only 1,000 being contacted by hot line operators. So do we read this as 11,000 did not qualify for the program in some way? And of the 1,000 contacted 250 people have been referred to counselors. We imagine that 250 will get whittled down even more. If only 250 have been even qualified for services the program does not seem to be worth the funds.

Or is the wording confusing and there were 12,000 calls and another 1,000 website submissions. With 1/4 of the calls being referred to counselors this would be about 3,250. A much better number than the first glimpse.

Hopefully more information will filter out so we can see how the program is really working. Are we throwing good money after bad, again? Or are we preventing a huge wave of foreclosures?


home refinance said...

Money is what were talking about. Everything is critical.Mortgage is the root of our economic crisis.So it is really important to be updated...

beachdude said...

Mortgage modification is a process whereby a home owner's mortgage is modified and both the lender and homeowner are bound by the new terms of the new mortgage.

The most common loan modifications are listed below:

lowering the mortgage interest rate
reducing the mortgage principal balance
fixing adjustable interest rates within the mortgage
increasing the loan term throughout the mortgage
forgiveness of payment defaults and fees
or any combination of the above

Check out this Public site at

NJHH said...

Thanks for the good info beachdude!