Foreclosure Fail: Study Pins Blame On Big Banks

A study by government and academic researchers finds that approximately 800,000 homeowners missed out on mortgage modifications because of big banks' poor performance.

Over the past several years, we've reported extensively on the big banks' foreclosure failings [1]. As a result of banks' disorganization and understaffing — particularly at the peak of the crisis in 2009 and 2010 — homeowners were often forced to run a gauntlet of confusion, delays, and errors when seeking a mortgage modification.

But while evidence of these problems was pervasive, it was always hard to quantify the damage. Just how many more people could have qualified under the administration's mortgage modification program if the banks had done a better job? In other words, how many people have been pushed toward foreclosure unnecessarily?

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