What is HAMP? It is President Obama’s Home Affordable Modification Program. It was a major mortgage modification scheme that was successful about one-tenth as many homeowners as predicted.
Banks have not been eager, in general, to modify mortgages and to take government money to write down mortgage principal.
Why? In most cases because banks no longer own the mortgages in question. Investors do.
HAMP provided hope to hundreds of thousands of struggling homeowners. In effect if not in purpose, HAMP simply spread out mortgage default over several years rather than having them happen within a year and swamping the market and driving down home prices.
Steve Dibert, a mortgage fraud investigator who owns the company MFI-Miami, said there was little surprise in the new revelations.
“Like everything else that has come out of Washington since the crash, this double talk is nothing new from Fannie Mae,” Dibert said. “They’ve been doing it for years. Mortgage servicers and banks have also been doing this for years. Contrary to what was pitched to Congress and the American people, HAMP was not designed to help homeowners. It was done to essentially take the 5 million plus mortgages that were slated to default in April of 2009 and spread them over a two to three year period. The banks feared that had this number of mortgages gone into default all at once it would have collapsed the US banking system.”
The documents also may impact all foreclosures. Dibert notes that those documents appear to indicate an ownership of the mortgages.