The Help (Kathryn Stockett)—I'm reading this before I see the movie, about black maids raising privileged white babies in Jackson, Mississippi, in 1962, and a young white woman who writes about their lives amidst the changing social and political climate.—Dory Rand, President
In order to encourage servicers to put borrowers into permanent modifications, Treasury makes incentive payments to servicers for every successful permanent modification. Treasury also makes incentive payments for every successful short sale or deed-in-lieu performed under the Home Affordable Alternatives Program. These incentive payments will be withheld from Bank of America, Chase, and Wells Fargo for second quarter 2011 and could even be permanently withheld if the servicers fail to improve next quarter.
The person familiar with Litton said he had examined loans that met the criteria for a government modification, but were denied it, sometimes because Litton employees made mistakes in how they calculated the borrower’s income. Other loans were denied the modification on the grounds that documents were missing, even though Litton’s computer system reflected receipt of the necessary paperwork, the person added.
A lack of transparency in loan servicers’ decision-making processes often frustrates homeowners applying for help from the Home Affordable Modification Program (HAMP). If homeowners were turned away from HAMP, their servicer was not required until recently to provide more than a simple explanation—“missing paperwork” or “ineligible borrower” would suffice. If homeowners have reason to believe that they are eligible, the lack of specific denial information gives them little to work with if they try to contest the decision.
That’s why we oppose recent efforts to eliminate HAMP and other foreclosure response programs, like the Neighborhood Stabilization Program. Pulling out support to distressed homeowners at this juncture would be disastrous for neighborhoods trying to recover from the foreclosure crisis.
Woodstock Institute Senior Vice President Geoff Smith presented the findings of a new report that found that thousands of foreclosed, vacant homes in the City of Chicago are likely poorly maintained, lack clear ownership, and threaten to destabilize neighborhoods. “The steward relationship between loan servicers and the homes in our neighborhoods is broken,” noted Smith.