Acquiring a mortgage loan
Acquiring a mortgage loan - 
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Kai Ryssdal: Debt seems to be a theme on the broadcast today. You know, in the olden days debtors were put in stocks in the public square, shamed until they were able to pay up. These days, it's increasingly lenders in the hot seat. In its latest try at rescuing the housing market, next month the Obama administration is going to start publishing the names of mortgage lenders who are taking their time lowering the interest rates for struggling homeowners. From Washington, John Dimsdale reports.

JOHN DIMSDALE: The government says 375,000 homeowners have cut cheaper temporary deals with their mortgage companies. Borrowers are saving an average $576 a month. But Assistant Treasury Secretary Michael Barr says lenders are taking too long to make those new terms permanent.

MICHAEL BARR: The number that have been converted to permanent modifications thus far is low. And servicers need to do better.

Banks get about $3,000 from the government for each permanent modification. Now, the government will start calling each company twice a day for progress updates. And next week, it will publish a list of each lender's record of permanent modifications. The administration wants all the temporary deals to be finalized by the end of the year.

But economist Richard Moody says that's not enough to get most banks to give up the income from existing loans, as long as those loans don't fall into foreclosure.

RICHARD MOODY: They're trying to do I think as little as they can to keep these loans current. After all, they are looking at the totality of their portfolio and all the fees that they can collect, be it delinquent fees and other processing fees.

As for publicizing scofflaws, Moody says better to appeal to the banks' bottom line than to their sense of shame. And that might be in the offing. Administrators of the $75-billion modification program are talking about unspecified penalties and sanctions for lenders who refuse to make permanent mortgage changes.

In Washington, I'm John Dimsdale for Marketplace.

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