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Foreclosure Crisis: Now I know Why There Is One

CNBC.com

I'm always asking myself the same question as I cover this seemingly endless housing crisis: if so many programs with so many lenders are working their darndest to save troubled borrowers, then why do we even have a foreclosure crisis?

Well I'm down in West Palm Beach, Florida today shooting a story on one of the first municipal foreclosure assistance centers in the country. They are using city money to help people with payments, refis and even short sales.

So I asked the director of the center what is her biggest frustration. I expected to hear about people not contacting them or predatory lending or investor speculators trying to scam. You know, the system: all the excuses the government types give us as to why their FHA Secure or Hope Now numbers of saved borrowers aren't higher.

But her answer was quite different. She said they were having trouble getting through to the people at the lenders who are supposedly sitting there all ready to help.

Now this is a city program, not some lone borrower dialing the main number at Countrywide . This is all these folks do, and they are having trouble finding the right reps from the lenders who can help. They also said that most of the lenders have such high standards to refi or rework loans these days that the bulk of the troubled borrowers seeking help don't qualify. There's my answer, I guess.

Questions? Comments? RealtyCheck@cnbc.com

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  • Diana Olick serves as CNBC's real estate correspondent as well as the editor of the Realty Check section on CNBC.com.

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