Obama May Prohibit Home-Loan Foreclosures Without HAMP Review

[yoyoma51]

[email protected];

http://www.bloomberg.com/apps/news?pid=20601087&sid=ahuuwBS8KYq8

[justbroke]

This is all touchy feelly, and I bet by the time it reaches an administrative order or other directive from the White House, it will have no teeth. The current HAMP stuff is all "voluntary" on part of the banks. They are, to this day, allowed to continue foreclosure proceedings, even when the person is being considered for modification.

How about letting Bankruptcy Judges modify the terms of a homestead property in 11 USC 1325? You know why not? Because the banks would loose too much money. LOL

HAMP is prolonging the crisis, and if you think the shadow inventory is something now... wait until this toothless modification to HAMP is enacted. There's another bubble, and I really don't know if I want to be around when that one bursts. (The shadow inventory problem is that once that inventory is released, it would take you years, yes, years to sell a home due to a housing surplus. Communities, such as several in California, may just have to start bulldozering tracts of homes because providing services just won't be worth it.)

This is what the real deal is: "In its current form, HAMP both hurts homeowners who might otherwise spend their trial-period mortgage payments on rent and also distorts the housing market, delaying any recovery.” The problem is that very few get permanent mods, so they wasted their money on the trial payments. In many cases, this is exactly why the servicer/lender allowed the trial... just to deny in the end, and make a little more money doing it.

Ah, but I repeat myself.

[manifest]

Re: HAMP

Where are u getting the evidence to support HAMP offers a small amount of "permanent modifications?"

[manifest]

Also, is there a "sure-way" to guarantee a homeowner will receive a "permanent mod?" What would be a scenario where a servicer/underwriter would more than likely "deny" a homeowner a "permanent mod?" Thanks!

[justbroke]

Where are u getting the evidence to support HAMP offers a small amount of "permanent modifications?"

The news.

Besides, I read in the article, above, which reads 116,297 out of 830,000 have received permanent modifications. That's 14%. It's much better than it was last December (2009) when the rate was about 5%. Yes, I keep up with these things to see what's working. The only reason it's at 14% was because Treasury leaned on the Banks that hadn't paid back their TARP money, so Bank of America, for example, made more than 12,000 loans permanent in one fell swoop, just to get the Treasury off their back.

This is nothing but a big game for the politicians and the banks. It's all about who has the political will and the power to make the other do what they want the other party to do. With the new Supreme Court ruling, on unlimited contributions for companies in elections, the politicians are afraid to challenge big money.

I just call them as I see them.

Also, is there a "sure-way" to guarantee a homeowner will receive a "permanent mod?" What would be a scenario where a servicer/underwriter would more than likely "deny" a homeowner a "permanent mod?" Thanks!

No. Affordability is the major key. They do try to get you to 31%, but not at the point where the lender suffers. Please read the entire way that HAMP is structured. The lender must get you to 36% DTI (or so) under their own plan. The other 5% (to get to 31%) is paid for via HAMP (through TARP).

So, sure, some people really can't afford the place, even with modification. Also, if you have a 2nd mortgage, this could complicate things.

[manifest]

Re: HAMP

Do u have a "link" for me to read on how "HAMP" is structured?

[manifest]

Oh, if I received a "traditional" mod back in 10/08 from my servicer.... Would I still be eligible for a HAMP mod knowing I meet ALL of their other requirement?

[justbroke]

Unfortunately, I read the document. There's some complex math in here for servicers/lenders.

http://www.ustreas.gov/press/releases/reports/modification_program_guidelines.pdf

Oh, if I received a "traditional" mod back in 10/08 from my servicer.... Would I still be eligible for a HAMP mod knowing I meet ALL of their other requirement?

Yes, there's nothing in HAMP preventing that, but remember that HAMP is voluntary for the lender... unless they received and haven't paid back TARP money.

[manifest]

Re:

Would I need to contact my servicer to know whether they are willing to perform the service for me? They do happen to be listed as a "servicer" of this program.

[DeadManCrawling]

Another issue for HAMP and virtually all modification programs:

Vast numbers of people do qualify, and do meet ALL criteria. These folks get a mod, make 6 months or more in payments, and then have the mod taken away. Cancelled.

On second thought, they are told, you don't qualify after all.

Not trying to rain on the parade, but you should consider this possibility. The bank takes months worth of mod payments and then forecloses anyway.

It happens-often.

These programs looked good in the beginning, and have helped some people, but I don;t think they turned out the way anyone envisioned.

Also, some lenders will put you in an in-house mod first, and only look to HAMP and other programs after they have gotten a few more bucks out of you under their own set of rules.

Hopefully we will see either a revised set of programs or an all-out foreclosure on all properties that are in default. No other way out for us, I think, in economic terms. We have to find the bottom and squeeze out the bad debt, even if it hurts. Otherwise we risk a decades long recession or depression.