US Housing Market Still In Shambles As Obama's Loan Modification Program Fails To Take OffBret Holmesupdated Jan 19, 2010TweetAt GET.com we maintain complete editorial integrity on our content & provide transparent & unbiased information. Companies don't pay us to include their products although we receive a compensation when you successfully apply to products from our partners. See how we make money here.At GET.com we maintain complete editorial integrity.Despite a concerted effort by the Obama administration to rebuild the housing market, it continues to languish. The government's Home Affordable Modification Program (HAMP) failed to stymie foreclosures last year, and 2010 may not be any better.Instead of declining, the number of foreclosed homes in the United States last year increased to a record 2.8 million, a 21% rise over 2008 and 120% over 2007, according to RealtyTrac. Foreclosures in the fourth quarter jumped 18% over the same period last year.Not helping matters is HAMP, which was designed as an incentive for banks to restructure mortgage payments for homeowners facing foreclosures. The Obama administration set aside $75 billion to subsidize lenders that successfully modify troubled loans by reducing interest rates, extending loan repayments, deferring principle payments for as long as five years and adjusting other mortgage terms.Over 900,000 homeowners have started trial modifications and over 1 million offers for trial modifications have been extended to borrowers, according to the government.However, about 25% of homeowners who received trial loan modifications through the plan are failing to keep up with their new reduced payments, and at least 196,000 borrowers have missed some or all of their required payments, according to comments Treasury officials made on a conference call today and calculations from government data, Bloomberg reported.HAMP, which was designed to help as many as 4 million Americans had successfully modified just 66,465 loans."None of these programs have really been a success," Vivek Sriram, a mortgage strategist for RBC Capital Markets Corp. told Bloomberg. "With the high unemployment rate, it's tough to solve the problem because these people will redefault even if their loan terms are fixed."The U.S. has shed 7.2 million jobs since the recession began more than two years ago and the national unemployment rate stagnated at 10% in December. Still, 2010 could be even worse."As bad as the 2009 numbers are, they probably would have been worse if not for legislative and industry-related delays in processing delinquent loans," said James Saccacio, chief executive officer of RealtyTrac. "In the long term, a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond, as lenders gradually work their way through the backlog."Editorial Disclosure: Any personal views and opinions expressed by the author in this article are the author's own and do not necessarily reflect the viewpoint of GET.com. The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the companies mentioned, and have not been reviewed, approved or otherwise endorsed by any of these entities.