The Obama administration is reportedly considering an expansion of its mortgage relief program to address questions of how consumers are treated by mortgage banks.
Several news organizations, including the Wall Street Journal and the Associated Press, obtained a draft of a Treasury Department document, which includes a proposal that prevents lenders from proceeding with foreclosures while homeowners were being evaluated for assistance by housing counselors. The proposals would also provide borrowers with a 30-day period for appealing a denial of loan modification under the Home Affordable Modification Program, and during this period, servicers would not be able to put the property up for sale in a foreclosure auction.
Also included in the document is a proposal that would require mortgage companies to consider requests for assistance from homeowners that filed for bankruptcy; in the current rules, that is optional.
A Treasury spokesperson acknowledged the proposals were being considered but stated they were not approved and that no plans for their formal announcement have been made.
SOURCES: Associated Press, Wall Street Journal