Loan Modifications Not Working Out So Well

A recent study by the Office of the Comptroller of the Currency found that more than 50 percent of troubled homeowners had missed at least one payment six months after a lender modified their loan, and lenders and other researchers report similar default rates on modified mortgages...As the economy continues to slow, layoffs mount and housing prices drop more, making it even harder for homeowners to sell their homes to pay off their loans, the default rate is expected to rise. "As the economy worsens, we're going to see defaults and re-defaults go up," said FDIC Chairman Sheila C. Bair. "That's just going to happen. People need to understand that." — Washington Post

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