Obama's Housing Rescue Plan: Two Sides


After much ado on the international stage, President Obama decided to shift attention back to the domestic issues at hand, and where better to start than housing.

He assembled a "round table" in the Roosevelt Room, which included the Treasury and Housing Secretaries, as well as some homeowners who have benefited from the refinance component of the "Making Homes Affordable" plan, announced February 18th.

The President chose to focus on the refinance component of the program, rather than the modification component, because the leader of the free world is no dummy. The refi program has been very successful for thousands of homeowners across the nation. Refis are up 88% since the announcement of the plan and up 122% in just the past five weeks. Fannie Mae refinanced $77 billion worth of mortgages in March, nearly twice the amount in February. Even one of my cameramen finished his refi last week.

But what about the modification component? Administration officials will tell you that it's still ramping up. In fact the President said today, "we are in the process of rolling out some additional phases to the program," and one official told me that part of that will be a second lien component. But many of you have been writing in to the realtycheck blog (RealtyCheck@cnbc.com), telling your stories of frustration with the modification plan.

I thought I'd share one in particular, a homeowner working with Chase, who has not yet missed a payment but is close to it.

(Missing a payment is not necessary to qualify for the plan).

March 5 – I went to Chase’s website which directs you to help for homeowners. Clear instructions on downloading forms, information to include and fax number. I pulled together tax info., bills, bank receipts, etc. and faxed them.

March 18 – I called and spoke to Ben who said my application would be expedited and someone would call me within 24 hours.

March 20 – I called and spoke to Kathy. She said they were waiting on clear directions from the government, there was no way they could check confirmation, and there was no one else to talk to. She said the modification was on hold indefinitely and they may not be participating in this program. She said she had no idea how long it would take. I just needed to be patient and wait. When I told that I was told I was supposed to be called, she said he shouldn’t have told me that.

March 23 – I called and spoke to Jason. He said a representative would be getting back to us soon.

Spring Real Estate Guide 2009 | A CNBC Special Report
Spring Real Estate Guide 2009 | A CNBC Special Report

March 25 – I called and spoke to John. He said it would be fourteen calendar days from today. To call if we haven’t heard.

April 2 – Carminia answered the phone and said I shouldn’t be calling this number (this is the number that is published for modifications) because I wasn’t behind in my payments. She transferred me to Carrie in Customer Service. Carrie said I shouldn’t talk to her about a loan modification I should talk to collections. I was transferred to Al who said it looked like my application had not been sent to an analyst and I faxed it to the wrong number. (The application has in bold, the number to fax.) Al gave me a fax to Homeowners Assistance. Al transferred me to Dan in Homeowners Assistance and he said that in two weeks a specialist should contact me. Dan said I could call the status department tomorrow to see if they received my fax.

April 3 – I called the status department and spoke to Neesha. Neesha said I need to talk to Homeowners Assistance. She transferred me to Luke. Luke says they have nothing in the system and it takes two weeks to get it. When I expressed my frustration Luke transferred me to Anna in Collections. Anna took my information over the phone and said it takes thirty to forty-five days to have an analyst look at it. She also suggested I speak to refinance and transferred me to Kevin. Kevin said they would not have any information until April 6, a refinance would cost us, and to call back on April 10.

That about sums it up.

I have heard many similar stories of frustration, and as the number of defaults continues to rise, I wonder how many more there will be.

The banks clearly are not handling this new plan as efficiently as the supposed "streamlining" the administration touted suggests. I'm sure some people are getting good modifications, but I fear many more are not. Here is a responsible borrower, current on her loan, looking for help.

Clearly nobody is answering.

Questions? Comments? RealtyCheck@cnbc.com