Open up the newspaper, turn on the radio, check the news on the internet and here comes another  “we need to save it program” from Washington and you can bet the word “billion” is in the first paragraph.  Not that I don’t think we need some help from the government, because I do support plans to revive our housing market here in Sacramento, but it is hard to keep up with all of it and how to access this help is always less than vague.

This morning I learned about the "Making Homes Affordable" initiative which in general terms is a plan to help as many as 9 million borrowers stay in their homes and it is going to cost 75 billion dollars.  That is about 8,300 per homeowner which would help make a few payments. 

From what I could learn, it is a refinancing/loan modification program and is for loans made before 2009 and for loans on homes with values less than $729,750.  To qualify for a loan modification under this program the homeowner must submit an affidavit of financial hardship, their most recent tax return and two pay stubs.

The plan also includes help for borrowers who have mortgages held by government controlled mortgage companies, Fannie Mae and Freddie Mac.  These homeowners are eligible to refinance through June of 2010.

This all sounds good especially when you combine it with the American Recovery and Reinvestment Act of 2009 and the Homeowner Affordability and Stability Plan. But let be honest it is confusing. Do you know if your loan or part of your loan is held by Freddie or Fannie?  Where would you get that information?  Is this program like the ones before it that promised banks would stop foreclosures and work with borrowers on loan modifications?  Not one of clients who we have helped avoid foreclosure or who we are now representing in a short sale has had any success working with their lender on a loan modification.  The plans all sound good when you read about them in the press releases but I do not have confidence it has been communicated to the lenders or is even a requirement to participate if they are getting “bail out money.”

Give us some contact numbers or email addresses to the various lenders who are participating. We need to see some concrete details of how you apply for these modifications and an ombudsman where you can complain when a lender says, “We don’t care what your read, send us your payment or we will foreclose.”