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14 Aug 10 Obama Mortgage Relief Success Challenged in California

California Lawmaker Challenges the Obama Administration’s Claim of Successful Mortgage Relief

Underwater mortgages, short sales and home foreclosures have taken their toll on the California housing crisis.  Ask the struggling local homeowners how the California loan modification process is going.  Yet the Obama Administration continues to  act as if property values are rebounding and we are out of the woods economically.  I’m not sure where the President is getting his news from, but California has not turned the corner yet on the housing crisis.

Most distressed homeowners will tell you that get approved for a mortgage modification is almost as difficult as it is to be approved for a California mortgage refinance.  Foreclosures have become a serious problem in most of California and the Federal loan relief simply has not been attainable for most homeowners in the state.

Qualifying for California Loan Modification Programs

A Democratic congressman has issued a letter to President Obama slamming Housing Urban Development Secretary Shaun Donovan for claiming in an editorial that California’s Central Valley has seen an improvement from the height of the subprime mortgage crisis.

California Loan Relief is in High Demand!

The scathing letter is a rare on-the-record criticism of the Obama administration’s policies from a Democratic lawmaker and reflects the frustration many in Washington are feeling over the federal government’s pace of efforts in providing mortgage relief struggling homeowners.

Rep. Dennis Cardoza, D-Calif., noted that the three biggest cities in his district are ranked in the top 10 of RealtyTrac’s foreclosure list and claims Donovan has a “fundamental disconnect” between the reality on the ground and the fairy dust the administration is spreading.”  Cardoza says that Donovan failed to note the delinquency rate in his district has risen to more than 16% when he touted the decline in foreclosure rates in the Central Valley.  “In most simple terms: things are not getting better in the Central Valley, they are getting worse,” he wrote.  “We’re not going beyond the comments the secretary made in his editorial,” HUD spokesman Jerry Brown told  The White House did not respond to a request for comment.

In the opinion article, published Wednesday in the Fresno Bee, Donovan declared that “thanks to comprehensive efforts of the Obama administration and local leaders, we see strong evidence that the region’s housing market is improving.”  Donovan held up Central Valley as an example where the administration’s efforts have led to a decline in foreclosures. He noted that nearly every part of the Central Valley “has seen a substantial decline in foreclosures since this time a year ago.”  “This improvement is the result of, in large part, the array of targeted tools the Obama administration has provided to communities in this region, to the state and to homeowners to begin stabilizing the housing market,” he wrote.  But Cardoza argued that the administration’s primary housing programs – the Home Affordable Modification Program (HAMP) and the Neighborhood Stabilization Program (NSP) – “have not been effective in delivering aid to the hardest-hit communities.”  “Instead of taking ownership for these failures and taking decisive action to correct their obvious flaws, the secretary’s column is just another example by the administration to defend the existing programs while turning a blind-eye to the magnitude to this crisis.”

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