Obama Administration to streamline loan modifications

A day after delivering his first State of the Union address President Obama has streamlined the documentation requirements for homeowners looking to qualify for a loan modification. Starting June 1 the application process will be simplified in the hopes of helping more struggling homeowners take advantage of the ambitious program.

“We want this program to be about payment relief and affordability for homeowners, not about chasing documents back and forth,” said Phyllis Caldwell, chief of the Treasury Department’s Homeownership Preservation Office, on a conference call with reporters this afternoon.

The program, called Making Home Affordable, was originally designed to help approximately 4 million homeowners through 2012. Since its creation in March of 2009 the program has only helped 66,000 homeowners receive a permanent home modification. $75 billion has been budgeted for this program.

“It is our hope that these enhancements will make this process easier for homeowners who are able to demonstrate that they qualify for the program and need the program to be able to sustain their mortgage and remain in their home,” said Caldwell.