Detroit Foreclosures Contained by HAMP and Nonprofits

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Detroit foreclosures are being contained by the Home Affordable Modification Program based on data recently released by the U.S. Treasury Department.

So far this year, a total of 15,237 mortgage loans in the Detroit metro area have been modified under the Home Affordable Modification Program of the Obama administration, accounting for 2.1 percent of all loans modified in the entire U.S.

Compared to pace of loan modifications in other U.S. cities, Detroit is tenth. The top two cities are New York and Los Angeles. Next are Miami, Riverside and Phoenix.

Across Michigan, almost 25,000 mortgage loans were modified, among the highest number in the U.S. Many of these modified loans were still on 90-day trial modifications, making homeowners still worried about possible cancellation of their new mortgage terms.

So far, GMAC Mortgage has the highest number of permanent modifications accomplished among mortgage lenders. It has modified 7,111 mortgages permanently, representing 10 percent of its 67,539 qualified loans. It has also put another 19,559 mortgages into trial modifications, representing almost 30 percent of its home loans.

Bank of America is among those not performing well in carrying out HAMP, given that it holds more than one million mortgage loans in default by at least two months. It has put only around 157,000 mortgages into trial modification and only 98 into permanent modification.

Among nonprofits focusing on reducing the number of Detroit foreclosures is the faith-based nonprofit Central Detroit Christian Community Development Corporation. It was founded in 1994 to help carry out workforce training, housing projects, youth and children ministries but decided to concentrate on foreclosure prevention, loan modification and financial literacy programs after thousands of Detroit homeowners began to lose their houses to foreclosure.

To help distressed homeowners more effectively, CDC established a counseling center in the town hall of Redford Township to be able to be more accessible to households. It offers all of its loan modification counseling and foreclosure prevention services for free.

CDC has also hired trained and skilled foreclosure prevention counselors to negotiate new and affordable loan repayment schemes with lenders. Its counselors use a technology-driven and patent-pending mortgage modification and foreclosure prevention scheme to make the process easier and more efficient.

According to CDC housing director Antoinette Gray, the CDC program has helped a lot of families prevent their homes from being sold off at sheriff’s sales.

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