If youâ€™re delinquent on an FHA-insured home loan in St. Joseph, odds are youâ€™re not getting much help from the company that lent you the money.
In the St. Joseph Metropolitan Statistical Area, 458 FHA-insured home loans are delinquent, but only 12 modifications have been performed, according to U.S. Department of Housing and Urban Development data.
The HUD data listed BAC Home Loans Servicing LP, a subsidiary of Bank of America Corp., with 125 delinquent FHA loans in the area. The firm has performed one modification action. Midland Mortgage Co. also has performed one modification action on local, FHA-insured home loans that are delinquent. Approximately 54 of the FHA-insured area home loans serviced by Midland Mortgage Co. are delinquent.
The HUD data pertains to single-family home loans insured by the Federal Housing Administration.
â€œNeither President Obama nor I can understand why the numbers are so low on modifications,â€ said Dennis Lykins of Allied Home Mortgage Capital Corp.
Bank of America, he noted, might have its hands full. Bank of America recently took over the servicing of some mortgage loans for Taylor, Bean & Whitaker Mortgage Corp. It also absorbed the loan portfolio of Countrywide Financial Corp.
â€œIt appears that even though Congress and the president have pushed (loan modifications), someone on the lending end is not willing to cooperate,â€ said Gerald McCush, community development manager for the city of St. Joseph.
In particular, Mr. McCush said the government has provided federal dollars in the form of bank bailouts and the Homeowner Affordability and Stability Plan.
Bank of America and Wells Fargo, another active loan servicer in St. Joseph, both received TARP money during the financial crisis, according to U.S. Treasury data. Both companies have since returned the funds with interest. MidFirst Bank, the parent company of Midland Mortgage Co., did not receive TARP money.
The Homeowner Affordability and Stability Plan was intended to help up to 7 million to 9 million families restructure or refinance their mortgages to avoid foreclosure.
â€œ(The lack of modifications) is a problem, and it would appear that the (lending) institutions are not willing to give as much as they need to,â€ Mr. McCush added.
Wells Fargo has performed the bulk of modification actions on local, FHA-insured home loans currently delinquent: seven. Approximately 108 of the FHA-insured area home loans serviced by the company are delinquent. It also has initiated 26 forbearance actions related to local, FHA-insured home loans, according to HUD data. A forbearance agreement is when the loan servicer agrees to postpone, reduce or suspend payments due on a loan for a limited and specific time period.
BAC Home Loans Servicing has initiated one forbearance action related to local, FHA-insured home loans, according to HUD data. Midland Mortgage Co. has initiated eight forbearance actions related to local, FHA-insured home loans, according to the data.
Bank of America, Midland Mortgage Co. and Wells Fargo did not respond to requests seeking comment.
FHA-insured loans protect lenders against losses resulting from defaults. They also require very little cash investment to close a loan. They therefore appeal to lower-income borrowers.
Ryan Davis can be reached