When it was implemented a year ago there were such high hopes for the governments mortgage relief plan. Figures released during the middle of February show us that those high hopes clearly haven’t' been reached.

On February 17, 2010 the Treasury Department stated that figures as of the end of January show that about 116,000 of the homeowners that completed the application process to have their loan payments reduced permanently actually received a permanent loan modification. That figure shows that a mere 12 percent of the more than 1 million homeowners that started the process actually ever went on to receive a permanent modification to their home loan.

So far, about 61,000 homeowners that started the program have dropped out. There are two main reasons why homeowners dropout of the program; failure to make required payments during the trial modification process and failure to return the necessary paperwork to their respective banks. The numbers of these dropouts are expected to rise.

Treasury officials claim that the program is "on track" and currently doing what it was designed to do. However, these larger banks that hold a majority of the loans are struggling to keep up with the large volume of borrowers that need help.

For instance, as of the end of January, Bank of America Corp. Citigroup Inc. and JP Morgan Chase & Co. completed permanent loan modifications for less than 10 percent of the borrowers who started the loan modification process.

Recently, there has been a call for a major overhaul of the loan modification program. Many would like to see the government do more to encourage banks to cut the principal on loans rather than just change interest rates or extend the loan.

This seems to be a necessary step when considering the large numbers of homeowners that are currently underwater on their home loans. According to Moody's Economy.com, around a third of the homeowners in the United States owe more on their mortgage than their home is worth.

The program itself, while it might seem to be going nowhere, is actually helping struggling homeowners with the right amount of pressure on banks we could see respectable numbers of homeowners receiving permanent modifications if given time.