HAMP Program – Latest News on Success (and Failure)

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On December 14, 2010, the Congressional Oversight Panel (www.cop.senate.gov) issued a report that essentially states that the HAMP program (Obama’s loan modification program) has not been nearly as effective as previously hoped.

In the assessment made by the panel, it is stated that the government’s loan modification program (HAMP) clearly has not helped the 3 to 4 million homeowners that Barack Obama stated would receive more sustainable mortgage loans when the Home Affordable Modification Program (HAMP) was launched in March of 2009. Instead, only about 700,000 will have benefitted from this program.

It is interesting to note that while the Treasury initially committed $75 billion of Troubled Asset Relief Program (TARP) funds to the HAMP initiative, it now appears Treasury will spend only $4 billion on HAMP incentives.

The members of the panel even stated that government’s loan modification program was “ineffective,” and they claimed that the Treasury’s reluctance to address flaws of the program has had “real consequences.”

The report made by the Congressional Oversight Panel also states that the Treasury has failed to hold loan servicers accountable when they have repeatedly lost borrower paperwork or refused to perform loan modifications.

While the latest report on HAMP goes into more detail, it clearly corroborates what most borrowers and real estate aficionados have already experienced—that the concept of a loan modification for troubled borrowers is not as successful or effective as everyone would have hoped.

Facts about the latest assessment courtesy of the Congressional Oversight Panel

Opinions are my own ;-)

Comments

  1. I am a CA DRE licensee-broker. I can tell you that I have three clients that were told to enter the 3 month trial payment progran in order to move forward with a permanent modification. After making the payments as instructed and on time all three were then denied the permanent loan modification. Itr is obvious to thinking people that the banks, primarily B of A are just tryijnhg to get more money from the homeowner BEFORE THEY PROCEED TO FORECLOSE. this has replaced the way the banks got money in the beginning when they would ask the homeowner to send the savings to see IF the bank would or could help them OIF they did so. this was before the government current program. the banks are just going about their greedy dirty business as they always have. The politicians get too much money from the industries PACs and lobbyist to fight it. The banks apply the pressure and the threats and the politicians obey! WE HAVE THE BEST GOVERNMENT MONEY CAN BUY; AND THE BANKS HAVE THE MONEY VIA THE FED RESERVE SYSTEM WITH A LICENSE TO STEAL!!!! Beware of the fiat monmey the fractional banking system creates!!! Enlighten yourselves and read “The Creature From Jekyll Island” 5th edition.

    Chuck Rogers

    • Melissa Zavala

      I definitely agree with you. The issue of people believing that they are getting a modification and then learning that they are inches away from the auction block is quite common and I hear a lot of those stories. I will have to check out the book you suggest.

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