For Immediate Release
August 4, 2009
Contact: Tram Nguyen, 415-864-3980; email@example.com
Obama Modification Plan Needs Accountability to Work
Administration’s Data Reveals Major Problems with the Loan Modification Program
CA—The data released today by the Obama Administration confirm what homeowners and mortgage counselors have been reporting for months since the launch of the Home Affordable Modification Program (HAMP)–that loan servicers are not doing enough to modify loans despite billions in incentives, and that far too many struggling borrowers are falling through the program’s cracks.
“The release of this data is a modest step toward providing accountability to an otherwise opaque process and industry that leaves families and communities devastated,” said Kevin Stein, associate director of the California Reinvestment Coalition. “Congress and the Administration need to end their ‘pretty please’ approach to the banks and instead finally force lenders to work to keep people in their homes, including through bankruptcy cramdown legislation.”
The HAMP data shows the number of trial modifications offered as a percentage of each servicer’s estimated eligible loans, but it is unclear what percentage of all existing mortgages are eligible for HAMP. Even with the limited data, it’s clear that the results have been disappointing when percentages of trial modifications started for the largest servicers are as low as 4% for Bank of America and 6% for Wells Fargo.
The California Reinvestment Coalition calls on the Administration to provide more detailed data about HAMP to the public, including information about borrowers’ race and ethnicity; a breakout of data for California and other states (in order to see how many “underwater” borrowers are left out); and including option ARM loans that have yet to re-set as well as loans that are 60-days delinquent.
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For more information or to arrange interviews with advocates and borrowers, please contact Tram Nguyen at (415) 864-3980; firstname.lastname@example.org
The California Reinvestment Coalition advocates for the right of low-income communities and communities of color to have fair and equal access to banking and other financial services. CRC has a membership of more than 275 nonprofit organizations and public agencies across the state.--