HAMP isn't working and actually serves to entrap borrowers into foreclosure, by the millions in fact, which makes this the smart and correct policy decision. But politics is about perception, and this is not a good headline. For anyone.
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U.S. House Republicans plan to move forward with bills that would end anti-foreclosure programs put in place by the administration of President Barack Obama, saying they are doing more harm than good.
The House Financial Services Committee will consider bills next week to terminate four mortgage assistance programs, including the Treasury Department’s Home Affordable Modification Program, or HAMP.
“In an era of record-breaking deficits, it’s time to pull the plug on these programs that are actually doing more harm than good for struggling homeowners,” Representative Spencer Bachus of Alabama, the chairman of the panel, said today. “These programs may have been well-intentioned but they’re not working and, in reality, are making things worse.”
While the Treasury Department reported that more than 30,000 homeowners permanently lowered their mortgage payments in December as participation in HAMP accelerated, the program has failed to reach Obama’s goal of helping 3 million to 4 million homeowners avoid foreclosure. Troubled borrowers continue to fall out of the program at a faster rate than they join. A total of 58,020 loan modifications had been canceled through December, according to the Treasury.
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HAMP Needs to Go
Liberals agree it's the correct decision
"What is infuriating is that their logic is practically unassailable at this point," writes David Dayen of FireDogLake, a longtime critic of the program. "And this is why HAMP was so damaging. The government ruined its own brand with a program that hurt the people it was meant to help. This is why I've said for almost a year that HAMP gravely hurt liberalism. I cannot argue with Issa and Jordan and McHenry when they say that HAMP has to go."
The House bill would snag the unspent HAMP money and return it to the Treasury to pay down the national debt.
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