New York (CNNMoney.com) – More troubled homeowners have fallen out of trial mortgage modifications than have received long-term help, a new government report shows.
But nearly half of these borrowers received alternate help, while only 7% have fallen into foreclosure.
The administration's signature housing-rescue plan, Home Affordable Modification Program, saw a surge of people leave the initiative in May. More than 152,000 have had their trial adjustments cancelled since the program started, mainly because they could not document their income or because they earned too much to qualify for assistance, officials said.
Nearly 430,000 borrowers have had their trials cancelled - more than one-third of the total started. Servicers place troubled borrowers in trial modifications for several months to verify their income and see whether they can make the lowered payments.