In its first year of existence, the Iowa Mortgage Help Hotline has helped thousands of people that are at risk of losing their home. Iowa Attorney General Tom Miller said today that about one-quarter of the 3,700 applications taken in the last 12 months have ended with loan modifications.
Miller says about half of the applications are still in progress. The hotline was created in February of 2008 with a one-point-five million dollar federal grant. One of the many partners in the project is Iowa Mediation Service, which has offices in West Des Moines, Spencer, Mason City and Cedar Rapids.
I-M-S Executive Director Mike Thompson says negotiating home loan modifications can take several months because servicers are so far behind on the requests. "Part of the other problem with the negotiations – it’s not just with the servicer. They may have to go all the way to the investor to get final approval. So, we’re dealing with sort of a moving target at times," Thompson said.
"The third part that makes this really difficult…is we’re not seeing debt write-down yet. In a lot of ways, that’s going to make some of this work a little better if we can have some of these accounts written down." Thompson and Attorney General Miller both believe the federal foreclosure prevention program announced last week by President Obama will also help more Iowans stay in their homes.
However, Thompson says there are hundreds of homeowners in the state that are too far behind on their payments to help. "We have a number of people who don’t have jobs, people who have zero ability to make payments," Thompson said. "We’ve had some not make payments in over two years." Miller says a recent extension of the federal grant will keep the Iowa Mortgage Help Hotline in operation through the end of 2009. The toll-free number is 877-622-4866. Or visit the website here .