New foreclosure program swamps state

LANSING, Mich. (AP) - After a truly frustrating first day, a new program aimed at helping Michigan homeowners avoid foreclosure is running more smoothly.

The call takers at the Michigan State Housing Development Authority are answering questions from people on how to get help from the program funded by a federal grant of $150 million. For the first time, this program targets people who have lost their jobs and have no income.

But the Detroit Free Press reported the state received 30,000 calls by 10 a.m. Monday, causing its phone system to crash.

"Yesterday morning in the first two hours of rolling out the program, we had over 30,000 calls," said Mary Towney of the MSHDA, "so that just shows us there is a very large need here in this state."

But things were much smoother Tuesday. "We've remedied the situation. We've gottne additional staff members to answer calls and today's return time on phone calls is much better."

Wait time for callers was running less than five minutes Tuesday. By 1 p.m., more than 1,400 calls got through from nearly 1,700 calls to the office.

The first thing homeowners have to do, she said, is call their own lender to get them the information about the program and start the paperwork. There are a list of lenders already participating on the MSHDA website.

The state expects the $154.5 million program could help more than 17,000 households, including thousands who are currently drawing unemployment benefits.

The program also would help homeowners who are behind on payments because of a temporary layoff or a medical condition, and those who have jobs but have lost income.

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The top four mortgage lenders in the United States are Chase Bank Mortgage, Bank of American Home Loans, Citibank and Wells Fargo Home Loans. Bank of America has not yet responded to a request for a statement, but the others did.

Chase Bank Mortgage: "We are committed to helping borrowers avoid foreclosure, are reviewing Michigan's program."

Citibank: "We currently have the Michigan Hardest Hit Program under review, but we have not yet determined our participation. Citi has a variety of homeowner assistance programs in place. From January 1, 2007 through March 31, 2010, Citi has helped more than 900,000 homeowners in their effort to avoid potential foreclosure."

Wells Fargo Home Loans: "Wells Fargo remains committed to working with and providing mortgage payment relief for those Michigan customers who have suffered a hardship. We are still evaluating how we will best be able to assist our customers under the Michigan program. Whenever a major initiative like this is implemented, we must first determine if it is consistent with investor guidelines. In the interim, we remain ready to assist homeowners with options under HAMP and our own relief programs."

The Associated Press contributed to this report.

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