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, faltering, 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 failed to even spend step three per cent of what they were allotted to save homeowners.
The ease of the application design, with its easy termination thresholds ($ten,000/$20,000) and eligibility requirements (Pell standing and you will house money), function the policy would be to deliver nearly 90 % of its relief cash to the people while making lower 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.
