The Obama administration’s Home Affordable Modifications program, under which distressed homeowners are being helped by modifying their mortgage loans so that they can avoid foreclosure, is likely to prove ineffective.

The latest statistics released by the Treasury Department and the Housing and Urban Development Department show that the number of borrowers who are defaulting on modified mortgage loans is quite high. Last month, the number of ‘cancelled’ loans doubled and reached close to 3,000 from around 1,500 in February. An even larger number have not been making their mortgage payments on time. [Read more…]