July 28 (Bloomberg) -- Mortgage servicers meeting with Obama administration officials pledged to step up the pace of loan modifications to keep more struggling homeowners from sliding into foreclosure, according to the U.S. Treasury.

“Too many homeowners are at risk of foreclosure right now,” Treasury Secretary Timothy Geithner said in a statement today after talks with mortgage-industry executives in Washington. “Today’s meeting was an opportunity to identify ways to accelerate the program and bring relief faster.”

The administration said more than 200,000 trial loan modifications have begun, and is setting a goal of starting at least 500,000 by Nov. 1. The Making Home Affordable loan modification program was crafted this year to help as many as 4 million struggling borrowers save their homes.

Industry executives and government officials agreed today to streamline the process and bring consistency to the rules used to handle applications by Fannie Mae and Freddie Mac, said John Mechem, a spokesman for the Mortgage Bankers Association.

Senate Banking Committee Chairman Christopher Dodd, a Connecticut Democrat, assailed the administration at a hearing this month for the sluggish results from anti-foreclosure programs, while industry executives spoke of “confusion and delay” from how the government sets rules for the programs.

Servicers today complained of the “piecemeal changes” the Obama administration has made to the program, according to Jay Brinkmann, the chief economist at the Mortgage Bankers Association in Washington.

‘Lot of Frustration’

“There’s an issue of announcing programs prior to when the details are figured out,” Brinkmann said. “When an announcement like that is made, suddenly the servicers start getting a lot of calls. That clogs up their call centers with questions they can’t answer and leads to a lot of frustration with servicers and consumers.”

Borrowers are still awaiting the final details of a plan announced in April that would let homeowners rework home-equity debt. Other elements of a broader plan announced in February have been slow to reach the public.

The administration has “encountered a few difficulties” in starting the Making Home Affordable refinancing program for troubled borrowers, William Apgar, an adviser at the Housing and Urban Development Department, said earlier this month.

“I am confident that the best practices shared today, combined with more transparent reporting methods, better communication among all parties, and a strong commitment from servicers, will ensure that we can ramp up the” program’s pace, HUD Secretary Shaun Donovan said today.

Foreclosures Rise

More than 1.5 million properties received a default or auction notice or were seized by banks in the six months through June, Irvine, California-based RealtyTrac Inc. said July 16 in a statement. That’s a 15 percent increase from a year earlier.

The Making Home Affordable program requires banks that received federal aid from the Treasury’s Troubled Asset Relief Program, or TARP, as well as mortgage-finance companies Fannie Mae and Freddie Mac to lower the monthly payments for borrowers at “imminent risk” of default. Banks can lengthen repayment terms, lower interest rates to as low as 2 percent and forbear outstanding principal, among other methods.

To contact the reporter on this story: Dawn Kopecki in Washington at dkopecki@bloomberg.net;

Last Updated: July 28, 2009 17:31 EDT