Housing Update & Mortgage Modification Plan and Foreclosure Assistance Resources; HEMAP – targeting Treasury’s housing funds to loans for unemployed homeowners, Barney Frank’s proposed bill…

housinginyourhands

Our previous post on Rep Frank (D-MA) proposal on extending some of the TARP and/or stimulus funds targeted for housing to a program that loans money to unemployed homeonwers to make their mortgage payments here.

A model is emerging in the hearings on the Hill, HEMAP (WSJ):

(…)The proposal to keep out-of-work homeowners in their homes, which was discussed at an oversight panel field hearing last month in Philadelphia, could be based on Pennsylvania’s Homeowners’ Emergency Mortgage Assistance Program.

With HEMAP, which was established in 1984, Pennsylvania state officials provide a two- or three-year loan to a jobless homeowner, depending on the individual’s finances and the economic situation. Using that program, homeowners aren’t responsible for repaying the vast majority of the principle or any of the interest on the loan until he or she finds a job.

Specifically, a struggling homeowner participating in the Pennsylvania program, which has depleted resources, requires jobless homeowners pay a token $25 a month until they get another job and their gross income surpasses 35% of their monthly housing costs, including mortgage and utility payments.

In some cases, when the household has some income, the payments would be made partly by the homeowner and partly by the state…

HUD has been lobbied for the legislation/program and they and Treasury sound positive on its implementation, my problem is the Frank legislation wants to use repaid TARP loans and I think they need to end TARP in December and use stimulus money or some of the 50b sitting in the HAMP fund instead:

…According to people familiar with the Obama administration mortgage modification program, officials from the Housing and Urban Development agency have met with Pennsylvania officials responsible for the development of the HEMAP program to discuss whether the state program could be expanded nationally. The presentation was met with a positive response from the HUD officials, they said. A federal official familiar with the mortgage modification program said the meeting took place and “a range of options are being discussed to expand the mortgage modification program nationally.”

Meanwhile, Neiman said he plans to discuss the HEMAP program with key Treasury officials as well as HUD Secretary Shaun Donovan. “I would propose that Treasury consider using TARP funds to fund existing or future state emergency mortgage assistance programs,” Neiman said.

Treasury spokeswoman Meg Reilly said the department continues to study further ways to help unemployed homeowners. …She pointed out that the Treasury’s $50 billion modification program, known as the Home Affordable  Modification Program, or HAMP, is open to the unemployed.

Sadly since Treasury has not agreed to open their NPV test and have the servicers give detailed explanations for denials on HAMP applications (as FDIC did with the IndyMac mods), there is no way to verify that underwriters are in fact properly considering the unemployed. Anecdotally I can say from all interviews I have seen with servicers they say the unemployed cannot be helped, I would not count on them considering these apps until I have seen it.

However, Dodds argues that even though the HAMP program is open to the jobless, it isn’t being used effectively to help them. “It’s real chaos with the mortgage companies trying to get HAMP going,” Dodds said.

He adds that, unlike the HAMP program, a federal loan approach to the jobless could help a large number of people in a short period of time. It also solves the concerns of mortgage servicers who complain they will be sued by mortgage securities investors who argue that these lenders will file lawsuits against them for modifying mortgage payments, he said….

WSJ

WSJ

I can attest to the chaos with HAMP applications and servicers 😦 I will recuse myself from commenting further on this program, cause there but for the grace of God go I…I will say if the banks arent going to modify loans effectively and Team TOTUS cannot see that tax increases, increased deficit spending and regulation will hamper growth and job creation, well in that scenario which seems more and more likely, we may see extended high unemployment for years (in the economic forecasts of PIMCO for one example the ‘new normal pretty much sucks). Anyway if this is the case we may really want to consider programs like this, if nothing else it is a way to directly stop the housing bleeding as a result of the rolling foreclosures tied to unemployment…

but it burns me to think of taxpayers loaning other taxpayers money to pay the banks that all the taxpayers loaned all our money to to begin with because the banks will not modify the damned loans.

Since fannie and freddie are backing most of these loans, that is ALSO the taxpayers funding the losses! so we are loaning ourselves money to pay banks who we loaned money to service loans and transfer funds to FANNIE FREDDIE whom we own and whom we also are loaning money to keep afloat. What the hell kind of outfit is this government running? How many times do we have to loan ourselves money in and out of many government pockets with banks making transfers? Why cant we just do the damned HOLC like HRC proposed in oh what 2007 now, she first raised it in 2005…we could have bought the houses many times over and stopped the bleeding, but then we couldn’t line many pockets eh? the frakkers.

Other Resources:
Making Home Affordable Treasury Program
e.Fannie Mae.com (servicer updates)
HUD- Department of Housing & Urban Devlopment
Fannie Mae mortgage customers call Fannie Mae at 1-800-7FANNIE (1-800-732-6643) or www.fanniemae.com/homeaffordable
Freddie Mac mortgage customers call Freddie Mac at 1-800-FREDDIE (1-800-373-3343) or www.freddiemac.com/avoidforeclosure
VA mortgage customers (thank you for your service) vall VA Financial Counselors at 1-877-827-3702 or www.homeloans.va.gov
FHA –www.fha.gov
Hope Now Alliance (Hank Paulson’s Plan) 1-888-995-4673 or www.hopenow.com

October 20, 2009. Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , . Economy, Finance, Foreclosures, Hillary Clinton, Housing, Obama Administration, Politics, TARP, Unemployment Statistics.

8 Comments

  1. Housing/FinReg: $1B for Federal Bridge loans for unemployed homeowners – HEMAP « Moderate in the Middle replied:

    […] covered the HEMAP plan and Barney Frank’s push for it here and here. It was added to the FinReg bill. It is […]

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  2. Housing: Bankruptcy Cramdown/Judicial Modification Amendment in Financial Regulation bill; Frank okays CBC Amendment for 3 billion in loans to unemployed homeowners, also allows HUD to fund states’ HEMAP programs… « Moderate in the Middl replied:

    […] has a rundown, they call this a CBC idea, but Barney floated it himself months ago: Responding to concerns from the Congressional Black Caucus, House Financial Services […]

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  3. Housing: Bankruptcy Cramdown/Judicial Modification Amendment on Financial Regulaiton bill; Frank okays CBC Amendment for 3 billion in loans to unemployed homeowners, also allows HUD to fund states’ HEMAP programs… « Moderate in the Middl replied:

    […] has a rundown, they call this a CBC idea, but Barney floated it himself months ago: Responding to concerns from the Congressional Black Caucus, House Financial Services […]

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  4. Housing: FINALLY! Some data on the trial mods! Treasury reports more than 27% of homeowners in trial modification are delinquent… « Moderate in the Middle replied:

    […] not this? Oh yeah HRC suggested it in 2007 and 2008, thus Obama won’t do it. Frakkers. Their next ingenius plan will be the HEMAP model so taxpayers can LOAN homeowners their mortgage payments… Again padding servicers pockets and not addressing the underlying issue. Via FAN FRED we OWN THE […]

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  5. Housing Update: Fannie Mae rolls out ‘Deed for Lease’ program renting foreclosed homes to owners… « Moderate in the Middle replied:

    […] Our previous posts on housing are numerous, start here.  Our post on Barney Frank’s proposal to do something similar to what Fannie is announcing today, but through government loaning money to homeowners then the homeowners paying their mortgages with it (thereby padding banks profits and adding loads of red tape) via legislation here. […]

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  6. Foreclosure Listings replied:

    There are good companies out there actually trying to help people. But unfortunately there are also bad ones that are trying to take advantage of the situations. I purchased 2 foreclosures and have been happy with my purchases.

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  7. loanmodificationmortgage replied:

    The most common mortgage modifications are listed below:

    lowering the mortgage interest rate
    reducing the mortgage principal balance
    fixing adjustable interest rates within the mortgage
    increasing the loan term throughout the mortgage
    forgiveness of payment defaults and fees
    or any combination of the above

    Check out this public service site: http://mortgagemodificationinfo.org

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  8. Twitter Trackbacks for Housing Update & Mortgage Modification Plan and Foreclosure Assistance Resources; HEMAP – targeting [moderateinthemiddle.wordpress.com] on Topsy.com replied:

    […] Housing Update & Mortgage Modification Plan and Foreclosure Assistance Resources; HEMAP – targ… moderateinthemiddle.wordpress.com/2009/10/20/housing-update-hemap-targeting-treasurys-housing-funds-to-loans-for-unemployed-homeowners-barney-franks-proposed-bill – view page – cached Housing Update & Mortgage Modification Plan and Foreclosure Assistance Resources; HEMAP – targeting Treasury’s housing funds to loans for unemployed homeowners, Barney Frank’s proposed bill… — From the page […]

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