Citigroup Expands Loan Modification Staff

Recently Obama administration renewed its emphasis on loan modification as a tool to help the struggling homeowners save their homes from foreclosure. This program called the Home Affordable Modification Program is a loan modification program designed to reduce at-risk borrowers’ monthly mortgage payments. This program is effective for mortgages originated on or prior to January 1, 2009, and will expire on December 31, 2012. As per the recent news of the loan modification servicers getting swamped by the ever increasing demand for loan modification the government has been asking all the major mortgage lenders like Citigroup to expand their team of loan modification assistance providers.

Relenting to the pressure Mortgage lender Citigroup has added 1,400 employees to its mortgage loan modification team in an effort to boost its processing and better assist struggling homeowners in line with the Obama administration’s Home Affordable Modification Program.

However, a number of experts and homeowners think the move is a bit overdue. A report from the Wall Street Journal showed that the cure rate—the number of delinquent loans that get back on track versus the total number of delinquencies per month—has dropped a great deal in recent months.

According to a study by Fitch Ratings, the cure rate for prime (conventional) loans dropped from 45% from the period between 2000 and 2006 to a mere 6.6% in July this year. For sub-prime loans, the rate dropped from an already low 19.4% to 5.3%. Alt-A loans, a category between prime and sub-prime, also fell from 30.2% to only 4.3% in the same period.

Citigroup’s move comes after the government urged mortgage servicers to ramp up their loan modification efforts and help stem foreclosures. Industry experts were quick to point out that the company could have acted earlier and helped more people, but remained lenient until the government had to pressure them into acting.

The move follows a previous call by the government for Citigroup to better cooperate with its program. Earlier in 2009, Federal Deposit Insurance Cooperation (FDIC) Chair Sheila Bair had to pressure the mortgage giant into joining its user-friendly loan modification program.

The government has been coming new and innovative ideas to help the distressed homeowners. For more information on the recent developments in the loan modification program and to choose the best home loan modification program consult the authorized loan modification consultant. Or you can also visit the best loan modification assistance resource on the internet: CDLoanMod.com