The Associated Press reported this week that the government’s mortgage relief plan has helped only 16% of borrowers who signed up since the plan’s launch last year. According to the Treasury, till last month, 170,000 homeowners had completed their applications and undergone permanent loan modifications, out of the 1.1 million homeowners who enrolled in the plan. 

Additionally, around 90,000 homeowners have lost their mortgage aid under the government’s program. Many of these borrowers failed to submit the necessary documentation proving their eligibility under the program while others did not qualify. Though the government lowered some of the eligibility standards, 500,000 borrowers who passed the three-month threshold of trial modifications have not received permanent loan modifications. 

According to many homeowners and consumer advocates, though they have submitted the required paperwork, lenders have either lost them or not processed them properly. Though the numbers have shown some improvement in February, where the number of borrowers receiving permanent loans modifications went up by 45% from January, more permanent modifications are necessary to prevent further foreclosures.