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HUD Numbers Don’t Add UP

by Peter G. Miller
January 2nd, 2008

CNBC Reporter Diana Olick reported on her blog that “here’s the truth: FHA Secure has receive about 3,000 applications from homeowners who are delinquent on their loans and has closed on about 600 since September, that answer from an official HUD staffer who gave me the actual numbers after more than one request.”

How did HUD respond? With mush.

According to Olick in another posting, HUD wrote the following in response:

“FHA Secure is off to a strong start, and we’re on pace to help a quarter of a million families next year who need help before their teaser rates reset or have already reset and can’t make the new higher payments. Without question, more and more homeowners are attracted to the affordable, sustainable alternative that FHA Secure offers.

“The relatively low number of delinquent borrowers coming to us is a positive sign that we’ve been effective in reaching out to families who need help before their teaser rates reset. Foreclosure benefits no one, and I don’t think the hundreds of thousands of homeowners applying to participate and the 48,000 families who have already closed on their FHA Secure-backed loans would question the benefits of this new and successful product.”

Nowhere does the HUD response say that Olick is wrong.

Nowhere does the HUD response deny that few borrowers facing foreclosure have been helped by the FHASecure program — the purported purpose of the FHASecure effort.

Nowhere does HUD say that more than a few hundred borrowers with delinquent conventional mortgages have been refinanced.

Meanwhile, Alan Drury, writing in the New York state’s Journal News, interviewed HUD spokesman Brian Sullivan, a known and credible source. Sullivan told Drury that “‘lender and borrower interest has been off the charts.’” The FHA got 127,686 applications to refinance mortgages from the time of the FHASecure announcement through Dec. 9, he said. Of those applicants, 2,950 were already delinquent on their payments, Sullivan said.”

Fair enough. But 2,950 applications from delinquent borrowers is not 33,000 or 48,000 loans. Moreover, 2,950 loan APPLICATIONS is not the same thing as endorsed and insured mortgages for delinquent borrowers.

The point remains: The FHASecure program is not making a dent in the foreclosure mess.

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This entry was posted on Wednesday, January 2nd, 2008 at 5:23 am and is filed under , . You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

2 Responses to “HUD Numbers Don’t Add UP”

  1. Carl Pruitt Says:

    These numbers on FHASecure are definitely not adding up correctly! However, I know that it is true that many are avoiding the necessity to use FHASecure because they are refinancing before they become delinquent. I believe all the hoopla over FHASecure has contributed to more people looking into FHA refinances as an option.
    Thanks!
    Carl Pruitt

  2. fornetti Says:

    I do not believe this

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