Treasury falls short on oversight of $75B foreclosure prevention program

New York /
Jan.January 27, 2011 03:50 PM

The Obama administration’s $75 billion foreclosure prevention program has been widely criticized for its failure to, well, prevent very many foreclosures, and ProPublica has been investigating why the program has come up short. According to the publication, one major factor has been a possible “fatal” lack of oversight by the Treasury Department, which said this week that it doesn’t have the power under the Home Affordable Mortgage Program, known as HAMP, to punish mortgage servicers for denying loan modifications without cause. When the program was launched in 2009, the Treasury had promised to hit lenders with “monetary penalties and sanctions” if they didn’t make moves to clear their foreclosure backlogs. Since then, some officials have admitted that it was essentially all talk. “By every metric, the failure of the largest servicers to carry out the program is obvious,” said Alan White, a law professor at Valparaiso University. But they’re not being punished, he said, because “Treasury staff are preoccupied with friendly relations with the banks. Sometimes it seems the banks own Treasury.” [ProPublica]


Related Articles

arrow_forward_ios
All Falls Down: Kanye West’s “Star Wars”-themed affordable housing plan hits snag
All Falls Down: Kanye West’s “Star Wars”-themed affordable housing plan hits snag
All Falls Down: Kanye West’s “Star Wars”-themed affordable housing plan hits snag
Blend Labs ceo Nima Ghamsari (Illustration by Kevin Cifuentes for The Real Deal with Getty Images, Blend)
Digital mortgage firm Blend loses $478M, sheds more of workforce
Digital mortgage firm Blend loses $478M, sheds more of workforce
(Illustration by Kevin Rebong for The Real Deal with Getty)
Mortgage demand drops to turn-of-the-century levels
Mortgage demand drops to turn-of-the-century levels
From left: John Perez, Christian Amato and Nathalia Fernandez in front of Jacobi Hospital in the Bronx (Getty Images, JacobiPeds.org, ChristianAmato.com, John Perez)
Candidates back affordable housing, but not in their back yard
Candidates back affordable housing, but not in their back yard
Wells Fargo CEO Charles Scharf (Getty Images)
Wells Fargo backing off mortgage market
Wells Fargo backing off mortgage market
Gainesville mayor Lauren Poe (Facebook, Getty)
Gainesville close to ending single-family zoning
Gainesville close to ending single-family zoning
(Illustration by The Real Deal with Getty)
Housing affordability hits 33-year low
Housing affordability hits 33-year low
D&F Development Group’s Peter Florey and the development site at the northwest corner of Pulaski and Elwood Roads in East Northport (D&F Development Group, Google Maps)
Four decades in making, East Northport project clears key hurdle
Four decades in making, East Northport project clears key hurdle
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...