A record 14 percent of all homeowners with mortgages are behind on their payments. The $75 billion program to help homeowners has drawn some takers but the problem is 40 percent of them become delinquent again within a year.
That's a sorry record for a program designed to temporarily help borrowers. Participating lenders have offered help to more than 750,000 borrowers. Since March, about 31,000 of those who signed up for assistance have made at least three on-time payments. Their arrangements -- sometimes as much as 20 percent lower payments -- are then made permanent.
But about 35 percent of the borrowers who signed up were delinquent within three months. It's indicative of an economy that is still shedding jobs or modifying the ones that are left.
The program allows lenders to offer grace periods on payments, longer repayment schedules, lower interest rates or reduced balances.
The Associated Press reports there are some encouraging signs. Loans modified from April to June of this year had a better payback record than those modified during the same three months a year earlier.
