SIGTARP REPORT | More Than 7 Out of 10 (70%) Homeowners Were Turned Down From Their Servicer for HAMP

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SIGTARP REPORT | More Than 7 Out of 10 (70%) Homeowners Were Turned Down From Their Servicer for HAMP

SIGTARP REPORT | More Than 7 Out of 10 (70%) Homeowners Were Turned Down From Their Servicer for HAMP

“We also report that 70% of homeowners who applied for HAMP got turned down, with JP Morgan Chase, Bank of America, and Citi, each turning down 80% or more and Ocwen denying more than 70% of the homeowners.”

 

SIGTARP for the Troubled Asset Relief Program Advancing Economic Stability Through Transparency, Coordinated Oversight, and Robust Enforcement
Quarterly Report to Congress
July 29, 2015

ONLY 30% OF HOMEOWNERS WHO APPLIED FOR
HAMP GOT IN, 70% WERE TURNED DOWN BY
THEIR SERVICER

At the start of TARP, our nation was in a foreclosure crisis. More than two million
homeowners had foreclosures commenced against them in 2008.1 TARP is not
supposed to be just a bailout of the largest financial firms, but was always supposed
to include a bailout of homeowners at risk of foreclosure. Congress rejected
Treasury’s initial proposal that TARP just be a bailout of some of the largest
financial firms. Instead, in recognition of the foreclosure crisis, Congress made
foreclosure mitigation an express part of the law authorizing TARP. Among other
things, preserving homeownership is an explicit purpose of that law, and “the need
to help families keep their homes” is one of the considerations that the Secretary of
Treasury is required by law to consider in exercising his authorities under TARP.2
As SIGTARP reported in its March 25, 2010, audit report,i a working group of
officials from Treasury, the Department of Housing and Urban Development, and
the White House developed the outlines of a mortgage modification program that
was intended to “have a scale that can have a real impact on turning the housing
problems around in this country.”

In February 2009, the Administration announced its signature TARP housing
program known as the Home Affordable Modification Program (“HAMP”) to
“enable as many as 3 to 4 million at-risk homeowners to modify the terms of their
mortgage to avoid foreclosure.”3

Treasury designed HAMP to encourage mortgage servicers, on a voluntary
basis, to modify eligible mortgages so that the monthly payments of homeowners
who are in default or at imminent risk of default will be reduced to affordable,
sustainable levels. To encourage participation, Treasury pays incentives using
TARP funds. HAMP was initially a $75 billion program: $50 billion to be funded
by TARP funds for Treasury’s part of HAMP (to modify mortgages not owned by
the Government–sponsored enterprises Fannie Mae and Freddie Mac), plus $25
billion for GSE-owned mortgages.4 Although this allocation was reduced to $29.8,
approximately $18.5 billion in TARP funds remains unspent and available for
HAMP as of June 30, 2015.5

Although participation in HAMP is voluntary, servicers who agree to participate
are required to offer HAMP modifications to all eligible homeowners. The actual
execution of HAMP lies in large part with participating mortgage servicers, whose
employees are responsible for reviewing homeowner HAMP applications and
deciding whether a homeowner gets into HAMP or not. A servicer must follow the
HAMP rules in making its decision, and Treasury has an oversight responsibility to
ensure that servicers follow Treasury’s HAMP rules.ii

[…]

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2 Responses to “SIGTARP REPORT | More Than 7 Out of 10 (70%) Homeowners Were Turned Down From Their Servicer for HAMP”

  1. Jonny Boy says:

    This is Servicer fraud at it’s best. Forceing foreclosure on homeowners like Vultures waiting over a dead carcase. Where is the CFPB…..

  2. crittermom says:

    …And I’m bettin’ those 30% or less who got modifications, were those who could afford an attorney. I want to see the figures on how many of those 30% got modifications WITHOUT an attorney? Zero, perhaps?

    In other words, the former “middle class” most likely wasn’t helped AT ALL by this program, as many of us owed less on our homes than what legal counsel would have cost us.
    Those who got modifications, from all of the cases I’ve seen, were for those with attorneys, & mortgages closer to a half million dollars or more, so they could afford, & it made sense for them, to hire legal counsel. Everyone should realize by now, that banks only gave mods to those they were forced to give ’em to.
    These charts represent those facts, but don’t offer all of the meaning behind them.

    The former true “middle class”–those this program was most touted to help–were in fact the biggest losers, along with the ACTUAL investors (NOT the banks).

    The CFPB wasn’t in operation until mid 2011, I believe?
    When the first foreclosure tsunami hit, it was back in 2008.
    I know. I was one of those swept away in that sea of injustice, & my home sold at auction 4 yrs ago, after I fought the best I could, on my own.
    My mtg on my humble ranch of 20 yrs was far less than $140,000, which was more than I had, but much less than attorneys wanted, to enforce the laws on my behalf & save my home.

    I believe the CFPB is a good thing, is trying, & is making some progress, but for many of us, what was formerly “our” govt, sold us out long ago for their own interests, so the CFPB has many hurdles & roadblocks before them still.

    Rather than just rant on here, I just hung up the phone with a nice man from SIGTARP, telling him how I just downloaded & read the report, & my story & how the banks continue to abuse the system.
    I also requested they release info on how many of those 30% or less received mods without aid of an atty.

    He was interested in my story, even tho’ all statutes of limitations have run out in my case, & said I will receive a return call.

    Yeah, I continue to bitch to those in power. What more do I have to lose at this point? (& maybe it’ll help others)

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