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Obama’s ‘conceptually flawed’ mortgage lifeline effort to end this year

Livinglies's Weblog



The foreclosure crisis is still raging, but on Dec. 31, President Obama’s first and largest mortgage-modification program ends.

In February 2009, when a tidal wave of foreclosures threatened America’s ailing economy, Obama launched the Home Affordable Modification Program, or HAMP, touted as a lifeline for up to 4 million struggling homeowners.

It didn’t work out that way. Lenders have granted just 1.6 million permanent modifications — while canceling nearly 800,000 trial HAMP modifications.

Meanwhile, American families, including a disproportionate number of minority households, have lost 6.5 million homes to foreclosure since 2008.

Big financial institutions, however, have collected $16 billion from Uncle Sam for HAMP and related programs. HAMP did not force lenders to slash the total amounts owed, the surest route to helping troubled borrowers. Instead, the government paid lenders to modify loans at their discretion, with no obligation to convert trial modifications to long-term…

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One Response

  1. HAMP was a great idea but sadly it was and hasn’t been able to help the struggling home owners. We need to ratify the law so it can do what it intends to do, let people keep their homes. Hopefully the new administration can come up with a better solution for the future.


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