The government’s $50 billion program to ease the foreclosure crisis is helping only a tiny fraction of struggling homeowners. As of July, only 9% of eligible borrowers had seen their mortgage payments reduced. And a progress report on the plan today showed that 10 lenders had not changed a single loan. Both Bank of America Corp. and Wells Fargo & Co.—which have received billions in federal bailout money—were below average. BofA, which did not immediately comment, modified 4% of eligible loans, and Wells Fargo 6%. And Wachovia Corp., which was taken over by Wells Fargo last December, modified 2%.
“We know we’ve fallen short of our customer service goals in some cases,” Mike Heid, co-president of Wells Fargo’s mortgage unit, said in a statement. The company aims to sign up most borrowers for the Obama plan with one phone call and plans to send customers a trial offer within two days. Foreclosures, meanwhile, continue to rise. About 1.5 million households received at least one foreclosure-related notice in the first half of this year, according to RealtyTrac Inc.
