Today’s edition of the Washington Post features an article about the “Hope for Homeowners” loan modification program created last summer under H.R. 3221, the “Housing and Economic Recovery Act.” This program was written to assist up to 400,000 homeowners facing default by placing eligible borrowers into new, sustainable loans that are backed by the Federal Housing Administration (FHA).
H4H became effective October 1 and has only collected 312 applications to date. Many policymakers argue that the program’s strict eligibility guidelines and a lack of participation among mortgage lenders prevent more struggling homeowners from receiving aid.
HUD leadership, including current Secretary Steven Preston and FHA Commissioner Brian Montgomery have shouldered a large extent of the blame attached to H4H’s inability to reach a wider scope of homeowners facing foreclosure. However, both Preston and Montgomery have recently defended themselves publicly, stating that frustration with the program’s lack of success has been misdirected.