The Treasury is introducing new rules to its mortgage modification program.
Do you think it'll make any difference?
Starting June 1, Banks will have to document borrowers’ financial situations from the time they start the modification process. Also, borrowers won't have to submit W-2 forms, but they will have to hand over two pay stubs and an electronic form giving the government access to their tax returns and proof of income.
As it is now, many borrowers get trial loan modifications based on simply stating their incomes. Not surprisingly, those trial mods usually don’t lead to permanent adjustments because the borrowers can’t prove they have the incomes they said they had and 6 to 9 months latter they are back to step one.
The Treasury said it's trying to make it as easy as possible for people. Many borrowers are fed up with the government program, blaming the lenders for seemingly endless delays and for never ending paper work.
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