Mortgage Informer

Recent changes to the Obama administration’s mortgage assistance program may make it more vulnerable to fraud, a government watchdog says.

The changes, announced last month, are intended to make it easier for struggling homeowners to avoid foreclosure. But the administration hasn’t done enough to warn the public about fraud and hasn’t included sufficient safeguards to prevent abuse, the special inspector general for the Troubled Asset Relief Program, or TARP, said.

“Criminals feed on borrower confusion, and frequent changes to the programs provide opportunities for experienced criminal elements to prey on desperate homeowners,” inspector general Neil Barofsky wrote in a quarterly report issued Tuesday.

The initiative, which has been criticized, will be altered beginning June 1 to make loan servicers more proactive about helping homeowners facing foreclosure and to speed up the entire process.

Reporting from Washington – The Obama administration on Thursday announced changes to its controversial initiative to ease home foreclosures, expanding public outreach and eligibility in response to sharp criticism that the $75-billion program had been ineffective.