Not all servicers want to play the tortoise. Erbey claimed some of his rivals are accepting verbal verification and still granting mods. Others, like Citigroup Inc., are asking the government to ease income verification requirements.The danger is that doing so could effectively return to the days of stated-income loans, when lenders did not require verification of the income the borrower stated on their application. Stated income loans, widespread from 2003 to 2008, were a contributing factor to the housing bubble.As Treasury assesses whether to ease verification requirements, one area that most servicers are struggling with is obtaining an additional signature from borrowers who filed tax returns electronically. "You have to ask whether the documents are really providing additional support to the decision," Garland said. "The program is there. The money is there. We're all just tied up in paperwork."He also noted that some borrowers are being asked to submit documents — without a loan officer's aid — that were not required at origination. "Many of these loans were no-doc, low-doc loans to begin with, so we're holding the borrower to a more onerous qualification than they had originally."But Meadows said that without the extra layers, "we're falling into the same trap that got us into this problem in the first place."If servicers appear to be failing in their implementation of the Obama administration's loan-modification program, it may be for good reason: Reunderwriting hundreds of thousands of borrowers who got low- or no-documentation mortgages just takes time.

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