TARP extension targets foreclosures

Panel expresses doubts about preventative measures

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The Obama administration said today it will boost spending on foreclosure prevention as it exercises its authority to extend the $700 billion Troubled Asset Relief Program (TARP) to October.

The move came as a Congressional Oversight Panel issued a report concluding that the administration’s Home Affordable Modification Program (HAMP), which is funded largely by TARP, appears capable of preventing only a fraction of the projected 8 million to 13 million foreclosures anticipated in the next four or more years.

The TARP program had been scheduled to end this year. In a letter to Congressional leaders today, Treasury Secretary Timothy Geithner said the administration still needs the ability to draw on TARP funds in the event of an "immediate and substantial threat to the economy" stemming from continued financial instability.