The Home Affordable Modification Program that is supposed to help three to four million homeowners from possible foreclosures was only able to address 116,000 permanent loan modifications.  Sixty thousand borrowers who entered trial payment plans have also failed or rejected for a number of reasons.

Here is a list of HAMP complications and why it is failing to address the housing problems:

* The original design of the program allowed homeowners to request a 3 month trial modification with little documentation of their situation.  Although some were able to get through the trial program, some weren’t able to satisfy the program requirements to document their incomes.
* The program cannot deal with sudden job losses or sharply curtailed incomes.  This could end up in foreclosures if the borrower is not able to afford the mortgage payments
* The program is limited to monthly payment reductions and not actual cuts in the principal balances.  The program will not work for homeowners who are underwater on their mortgages and are stuck with homes worth less than the mortgage balance.