Industry NewsMortgage

Treasury blew chance for HAMP revamp, says report

Most TARP funds for distressed owners won't be spent

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The Obama administration's Home Affordable Modification Program will far fall short of its goals, and the Treasury Department's failure to acknowledge this before it lost its authority to reallocate the $30 billion in TARP funds earmarked for the program means most of that money won't be spent.That's the conclusion of the latest report from the Congressional Oversight Panel overseeing the Troubled Asset Relief Program (TARP).The panel estimates that when all is said and done, Treasury will have spent about $4 billion on HAMP to prevent 700,000 foreclosures -- far less than the goal of helping 3 million to 4 million homeowners when the program was launched in spring 2009.HAMP -- which provides financial incentives to loan servicers to modify the loans of troubled borrowers -- has fallen short of its goals because many borrowers did not meet eligibility requirements and loan servicers were not required to participate, the report said.Many attempts to modify loans were also derailed by th...