Last week, Christina McGrath of Riverside, Calif., got a loan
modification. Now she has some advice for the millions of homeowners
out there still seeking one: Call 10 to 15 times a day. Ask for the
president's office. Get informed. Don't take "no" for an answer.
"The only way I got this was by being a royal bitch," she says.
The Obama administration's Making Home Affordable loan modification program 
was launched on March 3 with the goal of helping up to 4 million
homeowners avoid foreclosure. Under the program, the government offers
incentive payments to loan servicers to reduce eligible homeowners'
mortgage payments to 31 percent of their monthly income. Most of the
top loan servicers have signed up to participate ,
which means they're obligated to offer all qualifying borrowers a
modification with the government's terms unless an existing contract
with the owner of the loan bars them from doing so.
have offered more than 100,000 Making Home Affordable loan
modifications so far, according to the Treasury Department. But a rapidly rising rate of foreclosures 
threatens to outpace these efforts. As is, servicers can barely keep up
with the torrent of calls from homeowners seeking modifications,
housing experts and borrowers tell ProPublica. And as the backlog piles
up, homeowners and housing counselors are citing delays, confusion and
other more serious hurdles to taking advantage of the administration's
McGrath says the loan modification she ultimately got
after "three months of hell" wasn't even through the government's
program, but the terms are similar.
Amber Nadwodney, a Chase
customer from Hoffman Estates, Ill., says that after her paperwork was
misplaced twice, she was told she'd have to wait three to four months
before being contacted again. Tom Kelly, a spokesman, says Chase is
trying as hard as it can to keep up with the demand. "It's a challenge
to do it as quickly as we'd like to," he says.
Chase takes 8,000 to 10,000 calls every day about the administration's program, according to a May 14 Treasury Department press release 
(PDF). Kelly says the company has more than 3,000 employees working on
loan modifications, and it hires hundreds more each month.
system is clearly overwhelmed. Servicers are overwhelmed," says Ray
Neirinckx, the coordinator of Rhode Island's Office of Homeownership
and a foreclosure-prevention advocate. He notes, however, that the
crush of interested homeowners is a sign that the program is
Veronica Raphael, a foreclosure specialist in
Westchester, N.Y., got so frustrated with the delays that she filed a
complaint with the New York State Banking Department against
Countrywide, now owned by Bank of America, and Wells Fargo last month,
citing unresponsiveness and lost paperwork. Since then, she said,
they've gotten more responsive. Neither Wells Fargo nor Bank of America
responded to requests for comment.
Roughly 230 of her agency's
clients have applied for a Making Home Affordable loan modification,
she says. No one has gotten one yet. She notes, however, that some may
not be eligible.
Gary Fitz, a Wells Fargo customer from Mission
Viejo, Calif., says he has endured lost paperwork and frustrating
delays, too. But more troubling to him, he says, is that the company
told him he wasn't eligible for the Obama administration's plan because
he is still current on his payments.
Fitz isn't the only one who
has heard this. "I've had a couple people tell me, gee, I might as well
become delinquent then, so I can qualify for this program," says
Catherine Amos, executive director of Grand Valley Housing Initiatives
in Colorado. Housing counselors say they would never tell a homeowner
to do this.
The administration's plan is, in fact, available to
borrowers who are current on their payments, and the government even
offers extra incentive payments to servicers that modify before a
Fitz says a Wells Fargo employee told him, "I don't really know that much about it," referring to the administration's plan.
Gilbert, executive director of the nonprofit Consumer Credit Counseling
Service of Northern Colorado and Southeast Wyoming, says untrained
staffers are one of the biggest problems her organization faces. When
her employees mention Making Home Affordable, many customer service
representatives "don't really know what's available or who qualifies or
that they're even providing it," she says.
Christina McGrath, a former Countrywide customer, Bank of America
representatives told her as recently as mid-May that they weren't
offering the administration's plan yet, even though the company signed
a participation agreement  (PDF) with the government on April 17.
Cornelius of Carmichael, Calif., another Bank of America customer (and
former Countrywide customer), says she was also told in early May that
the program wasn't available yet. "They told me they'd put me in the
system and get back to me in 90 days," she says. "Don't call us; we'll
Amos, the Colorado housing counselor, says that some
companies have proven to be more difficult than others. In general,
though, industry cooperation is increasing as the plan progresses. In
its early stages, "lenders didn't know which end was up, and they were
inundated and were not prepared and were resisting every bit of the
way," she says. "Now, they have resigned themselves to the fact that
they need to do this."
Dealing with the sheer volume of loans
will still take some time, however. There should have been a system in
place at the servicing companies before the government announced this
program, Amos suggests. "It was a cart-before-the-horse type of thing."
A Treasury Department spokeswoman says that it is working on ways to help servicers reach more borrowers faster.
will continue to follow homeowners' efforts to obtain Making Home
Affordable loan modifications. If you plan to apply for one, or already
have, please tell us your story .
Karen Weise and Ben Protess contributed reporting to this report.