As reported by the Associated Press, the Obama administration is implementing significant changes to the $75 billion Mortgage Aid Program that will potentially provide some much needed homeowner relief here in South Florida. These same changes, however, may also cause vulnerable homeowners to become innocent victims of fraudulent and criminal schemes. Therefore, it becomes important to retain the services of a reputable professional.
In response to the current real estate collapse here in South Florida, and other parts of the nation, the administration has added an incentive program for mortgage lenders which will encourage them to reduce the amount borrowers owe, providing “underwater” homeowners with some relief. The administration aims to prevent three to four million foreclosures by encouraging mortgage lenders to lower the monthly payments for many here in South Florida. In addition, through this new program, unemployed homeowners may have their mortgage payments cut by thirty-one percent of their income for three to six months.
Clearly, through these changes, the administration is attempting to aid struggling homeowners on the brink of foreclosure, especially those here in South Florida. But some critics are skeptical that the administration has not done enough to prevent fraud.
“Criminals feed on borrower confusion, and frequent changes to the programs provide opportunities for experienced criminal elements to prey on desperate homeowners,” inspector general Neil Barofsky wrote in a quarterly report issued April 20, 2010. Critics such as Barofsky believe that the administration has not done enough to warn borrowers about potential schemers tricking borrowers to pay upfront for modifications that never materialize. The critics also point out weaknesses to the mortgage incentive program due to the lack of an appraisal requirement to determine a home’s value. This could potentially open the flood gates for mortgage lenders to fraudulently qualify for incentive payments. The Treasury Department officials have responded by insisting that they will initiate a public service campaign to warn borrowers against fraud.
It is therefore important to trust your real estate needs to a trusted professional. If you are in danger of losing your home, contact our office today to discuss your options.