Many homeowners that couldn’t afford their home the first time around, can’t afford it the second or third, a new study finds. Fitch Ratings predicts that 55-65% of home loans getting modified will end up at least 60 days behind within a year. The percentage is even higher for those in subprimes…

…with 60-day delinquincies predicted at 65-75%. “Loan modifications hold clear value for many homeowners provided the modified payments are sustainable, but more often than not, reducing the home payments to an affordable level may not be enough to rescue borrowers who are overextended on other credit and expenses,” said Diane Pendley, a managing director at Fitch.

Many modified mortgages will default again, Fitch Ratings projects [LAT] (Scan: SyndProd)

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