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Hotline for At-Risk Loans Not So Helpful

Subprime victims find Hope Now Alliance doesn't live up to billing

By Nick McMaster,  Newser Staff

Posted Mar 13, 2008 3:46 PM CDT
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(Newser) – A hotline aimed at helping distressed mortgage borrowers is frequently overwhelmed by caller volume and rarely able to provide substantive aid, MSNBC reports. The Hope Now Alliance—a group of lenders and community groups heavily promoted by President Bush—is designed to improve lender-borrower communication and modify mortgages, most commonly interest-rate freezes on adjustable-rate mortgages.

The problem is that most mortgages are tied into securitized loan pools, and the scores of investors with stakes in the pool must be consulted before a loan can be modified. “I was fortunate to find a helpline like Hope,” one borrower told MSBNC, “but the loan modification that I just got from my lender is higher, and I cannot afford it."

The Hope Now Alliance, a partnership of lenders and community groups set up by the government, isn't proving the boon to homeowners at risk in the subprime crisis it was promoted as, MSNBC reports.
The Hope Now Alliance, a partnership of lenders and community groups set up by the government, isn't proving the boon to homeowners at risk in the subprime crisis it was promoted as, MSNBC reports.   (AP Photo/Nick Ut)
The Hope Now Alliance, a partnership of lenders and community groups set up by the government, isn't proving the boon to homeowners at risk in the subprime crisis it was promoted as, MSNBC reports.
The Hope Now Alliance, a partnership of lenders and community groups set up by the government, isn't proving the boon to homeowners at risk in the subprime crisis it was promoted as, MSNBC reports.   (AP Photo/Marcio Jose Sanchez)
The Hope Now Alliance, a partnership of lenders and community groups set up by the government, isn't proving the boon to homeowners at risk in the subprime crisis it was promoted as, MSNBC reports.
The Hope Now Alliance, a partnership of lenders and community groups set up by the government, isn't proving the boon to homeowners at risk in the subprime crisis it was promoted as, MSNBC reports.   (AP Photo/Ric Francis)
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Foreclosures in Feb. up 60% from a year ago
Reuters

More borrowers simply throwing in the towel
USA Today

Money • US

 
mortgage • mortgage backed securities • mortgage lender • subprime crisis • George W. Bush • securitized loan pools • New Hope Alliance • foreclosures

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