Instead, the Obama administration rolled out the industry-backed Home Affordable Modification Program (HAMP), relying on the voluntary cooperation of servicers to modify mortgages. The program was, even by the administration’s own modest objectives, weak, ultimately reaching less than a quarter of the three to four million homeowners it hoped to target. In the critical first two years, the administration don’t even invest step 3 per cent of what they were allotted to save homeowners.
The fresh new simplicity of the application form design, along with its easy cancellation thresholds ($10,000/$20,000) and you may eligibility conditions (Pell position and you can house income), setting the insurance policy will be submit nearly 90 % of its recovery dollars to the people and also make less than $75,000 a-year
Just as with cramdown, one reason the Obama administration failed to swiftly help homeowners was their obsession with ensuring their policies didn’t help the wrong type of debtor. Continue reading
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