Denied a loan modification? Help may be on the way

The Treasury Department and the Federal Housing Administration will issue new rules in the coming months allowing borrowers who were denied a loan modification to appeal the decision.

The action comes under the White House proposal announced this week that also lays out a plan to usher more borrowers into refinanced government-insured mortgages.

While the refinance plan will require passage by Congress, the appeal process will be implemented for the expanded Home Affordable Modification Program and the FHA modification program without legislation.

More than 1.8 million borrowers have been denied a HAMP trial under the previous version of the program. Changes were announced last week to allow more borrowers to qualify.

The Treasury already has call centers in place to hear third-party comments about HAMP, but there is no formal review process in place. To date, more than 1.3 million calls have been made to the hotline.