HAMP Effectiveness Reviewed by Senate Banking Committee

July 20, 2009

This post is parially excerpted from the MortgageOrb article “Senate Banking Committee Focuses on Hamp” by John Clapp.

On July 28, 2009, there will be a meeting between Treasury officials and servicers participating in the government’s Home Affordable Modification Program (HAMP).

In anticpation of this meeting, the Senate Banking Committee held a hearing Thursday morning (July 16) in an effort to help lawmakers gauge HAMPÂs progress – or lack thereof – since its introduction in February.

The hearing included testimonies from the Treasury, as well as Wells Fargo and Bank of America servicing execs.Â It highlighted the programÂs administrative obstacles and shortcomings.

In recent weeks, lawmakers have increasingly expressed concern that HAMP, originally projected to save up to 4 million homes, is both underperforming and being implemented too slowly.

Committee members also focused heavily on the inconsistent application of HAMPÂs guidelines. Several senators noted cases of borrowers being denied entry into HAMP despite meeting eligibility requirements.

Participants also discussed the TreasuryÂs recently announced plan to release performance data in early August.

The data will be broken down according to servicer, and thus will presumably highlight those servicers who are underperforming in their HAMP implementations.

Since the department announced its intentions to release this data, HAMP administrators have seen increased activities from certain servicers.