Some of the largest mortgage servicers in the region added lots of jobs to deal with an ongoing wave of defaulting mortgages, and increased requests to amend loan terms.

At Bank of America, the largest servicer in the nation, some 7,500 employees are now working on loan modification efforts, about double the number of workers assigned to the work a year ago, BofA executives said recently.

“We completed 150,000 in modifications in the first half of this year, or one in every four made,” said John Frazza, senior vice president at San Diego’s Home Loan Division.

Loan servicers collect the monthly payments and distribute the money to investors.

Loan modifications aren’t exactly working well for many homeowners, judging from the results of a recent report on the activity by the U.S. Treasury Department, which found 11 of the largest servicers helping only 5 percent of the total borrowers who are eligible.

Despite the relatively low number of loan workouts, usually involving extending the term or cutting the interest rates on adjustable rate mortgages, many lenders are touting their records.

Expanding Staff, Offices

Citibank, the nation’s fourth largest mortgage servicer, said for the first half of the year it helped 188,000 borrowers remain in their homes. New York-based Citi said it hired or trained an additional 4,000 consultants to work on the modification efforts during the past year, including 1,400 since Jan. 1.

“We are encouraged by the success of our initiatives and we are dedicated to doing more,” said Sanjiv Das, CEO of CitiMortgage.

BofA opened three offices in Southern California to handle loan modification work, but none in San Diego. JPMorgan Chase Bank, which acquired two large mortgage banks, including Washington Mutual last year, opened five offices in Southern California, including one in La Mesa devoted to loan workouts.

Chase spokesman Gary Kishner said that nationally Chase has helped 171,500 borrowers through the first half of 2009.

Wells Fargo Bank, which has a loan modification team in San Bernardino, said it hired 4,000 employees during the first half of the year, bringing the total to 11,500 people nationally who work on modifications.

For the first seven months of this year, Wells Fargo said it modified or started trial modifications on more than 240,000 loans.