Foreclosure: Feds' Prevention Plan Lags

Foreclosure

preventions were a leading priority when the Obama administration committed $50 billion in aid to troubled homeowners at the start of 2009. But as of October, the Treasury Department had spent only $600 million on the government's mortgage modification program, a mere drop in the bucket when compared to the proposed total.

The program uses TARP money to offer incentives to mortgage servicers to make loan modifications. The reasons for the failure to pay out more funds include that the program only pays out funds for completed modifications, not trials; and that homeowners receive loan reductions over a period of years, so many mods haven't been paid out in full yet.

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