The League of Iowa
Human & Civil Rights Agencies

Published: November 30, 2009

The administration said Monday that it would increase the pressure on banks to help troubled homeowners receive permanently lower mortgage payments. The Treasury Department said that mortgage servicers would be required to submit plans on how they would decide whether a loan would be permanently modified. Bank that fall short of the guidelines of their agreement could face fines or sanctions, the Treasury said.

Monday’s move was the latest evidence that a $75 billion taxpayer-financed effort aimed at stemming foreclosures was struggling. Even as lenders have accelerated the pace at which they are reducing mortgage payments for borrowers, most loans modified remain in a trial stage lasting up to five months, and only a tiny fraction of them have been made permanent.

[more]