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WASHINGTON
(Reuters) - 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 and JPMorgan Chase & Co
need to improve their loan modification efforts to merit the financial
incentives the administration's housing rescue program provides to
mortgage servicers. JPMorgan is at risk of permanently having support
reduced if it does not make substantial improvements, the Treasury said.
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)
Enlarge PhotoThe JP Morgan and Chase headquarters is seen in New York in this January 30, 2008 …
WASHINGTON
(Reuters) - 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 and JPMorgan Chase & Co
need to improve their loan modification efforts to merit the financial
incentives the administration's housing rescue program provides to
mortgage servicers. JPMorgan is at risk of permanently having support
reduced if it does not make substantial improvements, the Treasury said.
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)