The media and press are oh-so fond of telling us what a miserable failure the Home Affordable Mortgage Plan, or HAMP, has been. It sells to highlight the hapless distressed mortgage owner who was denied a mortgage modification because of a treacherous and careless lender, or the crook that took their money and didn’t do anything to modify their mortgage.
The plain fact is that the law works. It is the enforcement that has failed. Very quietly the U. S. Treasury Dept. in conjunction with Fannie Mae and Freddie Mac, admitted that enforcement of HAMP is too big for them. I can go into more detail about that if anyone cares to call me; I’ll write about it in the future.
The banks are absolutely thrilled with any negative press about mortgage modifications and effective short sales. It has been proven that they make more money on foreclosures. Talk about giggling in the back room……..
Those rare individuals out there who have not been affected by this economic downturn (or THINK they have been unaffected), tend to dismiss the HAMP effort as assisting reckless and irresponsible homeowners who should be punished for their behavior. It rarely works to try to explain how one foreclosure affects five other surrounding homes and their values; and ultimately the community to these people.
Here, for those willing to consider the facts, is an article from the venerable Wall Street Journal that shows that even the dismal accomplishments of HAMP have had a beneficial effect on the overall housng market in the U. S.
By slowing the flow of foreclosed homes to the market, it has helped prop up housing prices, at least for now. The administration’s Home Affordable Modification Program, or HAMP, and other state and federal efforts to avert foreclosures have helped “buy time” for the housing market, preventing steeper home-price declines. This from Barclay’s Capital in New York. Housing analysts at UBS Securities in New York, in a report last week, described HAMP as “a vehicle to delay the timing of new foreclosures hitting the market.”
Many analysts believe that a large share of the people who get modifications will default again within a year or two. I say again the banks want the distressed homeowner to fail. They make no effort to really ensure the mortgage modification applicants can complete all of the application requirements.
Treasury officials acknowledge the broader effect on home prices: “I think it has had quite a strong stabilizing influence” on the housing market, Treasury Assistant Secretary Michael Barr said in a briefing Friday. Admittedly, he has to say that. HAMP was his idea. Please take a moment to consider the positive effects if 5 percent of elegible mortgage modifications were approved. How about ten percent? Fifteen percent.
This article says, “Because of HAMP, banks feel heavy political pressure to carefully screen borrowers to see which ones might qualify for loan modifications before proceeding with foreclosures. That has extended the time it takes to decide whether to force through a foreclosure, creating a huge backlog of unresolved cases.” I personally can’t imagine how heavy the pressure is at the published one percent success rate.
Because the banks are avoiding the mortgage modification process, they are the ones “kicking the can down the road.” There is no excuse for ‘trial modifications.’ A trial modification is not a permanent modification. It is an excuse for your lender to find a way to deny a permanent mortgage modification.
One CEO is quoted as saying that HAMP has shamed lenders into assisting distressed homeowners. Again, I don’t see one percent as much effect. The software that I use to qualify a mortgage modification is approved by the U. S. Dept. of Justice. The shame is that more people dare to take advantage of the free counseling information. HAMP is not dragging out the housing recovery. HAMP does not even suggest trial modifications. The banks invented the tactic.
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tags: do it yourself mortgage loan modification, do-it-yourself short sale, mortgage loan modification, mortgage lender fraud, mass joinder lawsuit, mortgage loan modification colorado, mortgage loan modification nevada, mortgage loan modification arizona, mortgage loan modification new mexico, hamp, home affordable mortgage plan,
Originally posted 2010-01-20 22:21:01. Republished by Blog Post Promoter
{ 4 comments… read them below or add one }
The reason loan modifications don’t work is because the lenders don’t want them to work.
They make more money on a foreclosure.
People trust their lender and they’re getting the shaft
Loan modification programs do not seem to work properly as only very few percent has received loan modification. I believe It is better to receive help from a lawyer who has great experience in dealing with lenders.
Hi there thanks for your informative blog post on Mortgage-Mod-Monster.com – Comments on Corrupt Title suits help the non-Distressed Mortgage owner. It was very helpful for a report I am putting together for school.
Greetings thank you for your informative article on Mortgage. The article was very beneficial for a project I am working on for school.