HAMPer full of Hope?

Mortgage and Lending NMLS #94045

Fact: Less than 7% of the homeowners who entered Trial Modification Periods for the Housing Affordable Modification Program (HAMP) in some form have succeeded to date: http://abcnews.go.com/Business/wireStory?id=9572114

This news has spurred updates on the government site: www.makinghomeaffordable.gov

Enter the new 'Conversion Campaign'

According to MHA: "The Home Affordable Modification Program requires borrowers to enter into a Trial Period Plan before receiving a permanent Home Affordable Modification." Which suggests that you 'may' be converted to a permanent program after your required trial. Or does it? Exactly who decides who gets to move ahead into modification bliss and who gets denied? That part is quite a mystery. The link on ABC News above has made it quite clear that very few are making it through the Trial Period Plan now.

The Housing Affordable Modification Program has been deemed a failure for some time now. Success rates are abysmal by their own record. Why is this? You see, HAMP it is not a law with appropriate enforcements, but a set of guidelines. Lenders who opt into these guidelines get--you guessed it--extra financial benefits! But what does this mean to you, Mr. or Ms. Homeowner in distress? Essentially, any bank who says they are applying HAMP or MHA to modify your loan has their own set of interpretations of these guidelines. It depends on what their investor thinks about you, your property, your scenario and the likelihood anyone in congress or any oversight committee or governing body or ethics committee ever finding out what happened to you in the process of applying for loan modification.

So what happens if your loan modification application fails? Let's take a look what MHA promises next.

"LATEST NEWS: Treasury announces programs designed to expand resources for working families to access affordable rental housing and home ownership over long term at little or no expected cost to the taxpayer."  What exactly does this neat set of nice sounding phrases really mean? 

Let's dissect this masterfully worded statement:

What does a 'Treasury program' imply? A law? Something enforced and policed? Fat chance. Treasury has not exactly been working hard for homeowners. In fact, we can thank our Treasury for printing more money and devaluing your dollar (so everything you buy costs more) while letting Banks get a boatload of money for practically free. The active verb "designed' is an interesting choice of words. A design is a plan or methodology to deliver a solution of some kind. All good intentions are 'designed' to work.  

The key phrase 'expand resources' bears definition. Are they are implying more people on the desks of Hope for Homeowners (free HUD approved counseling service)? If so, I sincerely hope they are also arming these phone counselors with something more than free DIY advice. Currently the free advisors are doing little if anything to help you access actual help. They check your box and send you back to your bank. That's it. To be fair, maybe they have something grander in mind?

OK, assuming those expanded resources are worthwhile, why are they limiting them to 'working families'? What about working individuals or retired couples or other homeowners not neatly boxed up in that one phrase 'working families'? Doesn't this sound a tad biased?

Then we have: ' to access affordable rental housing and home ownership over long term'. This certainly implies you could 'access' your own home again. Congratulations! You may be offered your very own 'affordable (you can define that one) rental housing and get to stay put right where you live. So-does the 'affordable ...home ownership' bit mean you could own your home again after a period of said affordable rent? This sounds an awful lot to me like the 'we'll buy your house' folks who 'let' you rent your home and some time later, the price has gone up and woops you are back out on the street. I thought that whole flipping a distressed homeowner thing was illegal. Let's hope the MHA version is a kinder and gentler version.

But wait, there's more: 'at little or no expected cost to the taxpayer'. OH REALLY? What taxpayer are we talking about here? Today's taxpayer who behaved responsibly and didn't buy a house they couldn't afford or the future taxpayer who will inherit all these bills for expanded resources? I'd say a few so called living and breathing taxpayers might be incensed at the thought of subsidized housing for people who may or may not have behaved responsibly financially. To say the 'taxpayer' won't be footing the bill is ludicrous. Of course we are. Treasury has no other place to get the funds to fund these programs except our own tax dollars they take from our paychecks daily. Banks who hold these underwater homes that get 'rented or owned affordably' will be paid by the American taxpayer to keep people in their homes. I'm guessing the Banks will now hold full rights of title to the homes and if the renters fail in their cheap rent or upkeep the Banks will exercise their right to turf them out and sell when the time is right. For them.

Am I missing something here in this basket of tricks (HAMPer)? Feel free to add your thoughts. After all, we will be paying these bills for generations to come!

Remember to exercise your right to address your elected officials with your concerns: www.congress.org

FYI: Bank loan modifications are within the scope of authority of the Office of Comptroller of the Currency, Administrator of National Banks. Their website is:  http://www.occ.treas.gov  The website offers an online customer complaint form that can be used to make a complaint against your bank. Another resource, http://www.helpwithmybank.gov/provides answers and assistance to customers of National banks. The site includes answers to common questions and helps walk people through the process of contacting the OCC for additional assistance. If you prefer to contact the OCC by telephone they have the following toll free numbers: 

Contact OCC CAG  Toll Free:1-800-613-6743

TDD Number: 713-658-0340   FAX: 713-336-4301  Hours:  8 a.m. - 8 p.m., Eastern, Monday-Friday

Mail: Comptroller of the Currency,  Customer Assistance Group, 1301 McKinney Street, Suite 3450, Houston, TX 77010

Meanwhile, we just have to be vigilant. That's what works.


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