In our series, Dispatches from the Displaced, HuffPost's Eyes & Ears has highlighted the stories of Americans who are facing foreclosure or who have already lost their homes. Through featuring reader-submitted stories, we have chronicled problems from unresponsive banks, to ballooning interest rates and fraudulent consulting services. Admittedly, the stories have been bleak.
But in March, many struggling homeowners breathed a sign of relief when the Obama Administration launched the Making Home Affordable program. Dubbed the "homeowners' bailout," the $75 billion program seeks to help 7 to 9 million homeowners avoid foreclosure through refinancing and loan modification. Since the program was unveiled in early March, mortgage services have offered to modify some 100,000 loans, although the Treasury Department was unable to say how many loans have actually been modified.
One loan servicer told the Huffington Post that following announcement of the program guidelines, they have reached out to 49,000 homeowners who they believe might qualify for a Home Affordable Modification under the Obama plan. So far, they have approved 1,300 modifications. That's less than 3% of the borrowers they've contacted, but they anticipate that 75% of the borrowers who apply could eventually be approved. The 4 to 5 million homeowners whom government officials estimate the project with help have until December 31, 2012 to file for a modification.
The Making Home Affordable plan is a bold step towards helping troubled homeowners, but it's no panacea. We have yet to see whether the program is a success for borrowers who have been approved for modifications. Under the terms of the program, a borrower's monthly payment is reduced to no more than 31% of their gross income, which can lower payments significantly. But the rest of the debt doesn't vanish, and five years later, interest rates can start creeping up again. These modified loans may prevent foreclosures now, but are they just prolonging the inevitable?
Are you one of the lucky few who has secured a loan modification through the Making Home Affordable plan? We're eager to hear your story. Is a loan modification keeping you from foreclosure, and is it a long-term solution for your finances? Please, email your story to submissions+foreclosure@huffingtonpost.com.
In the months to come, we will be highlighting stories of those who have been entered into a new mortgage under Making Home Affordable. Please sign up here to receive updates about the feature and to join HuffPost's Eyes&Ears citizen reporting unit.
Find out more about Dispatches from the Displaced, HuffPost's Eyes&Ears series of reader-submitted foreclosure stories.