11 Percent Of Mortgage Modifications Fail, Report Shows

Consumers who receive debt relief through federally funded mortgage modification programs may not be out of the woods yet, with 11 percent of homeowners defaulting on their loans, according to the latest government reports.

Data from the U.S. Department of Housing and Urban Development showed that while defaults on modified loans continue to be a problem, more than 3.52 million modifications were initiated between April of 2009 and August 2010. This number is more than three times the amount of foreclosures that were completed during the same period.

"Over the last 21 months, the Obama Administration's swift action in the housing market has kept millions of families in their homes and provided responsible borrowers with incentives to refinance or to become a homeowner," HUD Assistant Secretary Raphael Bostic said. "But, with many unavoidable foreclosures still in the pipeline, it's clear that we have a hard road ahead."

Although the results of the report suggest some improvements in the real estate market, foreclosures continue to increase, rising 4 percent during the third quarter of 2010. Analysts expect foreclosures filings to increase through the end of the year.