The Obama administration said on Wednesday it will keep the pressure on two big banks to help ease the foreclosure crisis, withholding payments to them under a foreclosure relief program.
The Treasury said Bank of America
The Treasury's Home Affordable Modification Program, known as HAMP, provides incentives for mortgage servicers to rewrite loan terms to reduce monthly payments for struggling borrowers.
The mortgage servicing industry lacked accountability and transparency when this crisis started, said Treasury Assistant Secretary for Financial Stability Tim Massad. Publishing these servicer assessments is key to our efforts to hold servicers publicly accountable for their performance and keep necessary pressure on them to improve.
The Treasury's move against the servicers came as the department issued its latest scorecard on the number of homeowners who have won permanent loan modifications under the program.
The federal initiative to avert foreclosures helped 26,102 more homeowners win a permanent loan modification in October. The Treasury and the Department of Housing and Urban Development said 883,076 homeowners had been granted permanent loan modifications since the program was launched in 2009.
When HAMP was launched, the administration said it expected 3 million to 4 million homeowners would benefit by having their loans modified to permit lower payments or to extend the period over which payments could be made. So far, the program has started 1.74 million trial and permanent modifications. (Reporting by Margaret Chadbourn; Editing by Dan Grebler)