WASHINGTON Distressed homeowners are redefaulting in droves on loan modifications received through a government program, costing taxpayers billions and raising questions about the Treasury Department’s oversight of mortgage servicers.
Christy Romero, the special inspector general for the Troubled Asset Relief Program, said in a report to Congress Treasury failed to analyze its own data to determine which borrowers were most at risk of losing their homes to foreclosure after receiving government support, according to American Banker, an affiliate of Credit Union Journal.
The watchdog said 46% of homeowners who got help in 2009 through the government’s Home Affordable Modification Program have redefaulted on their mortgages, while 38% who received loan mods in 2010 have done so.
“This is a real problem,” said Romero. “We want homeowners to get the same help they were promised that was given to banks.”
