President Obama's much-ballyhooed Home Affordable Modification Program (HAMP) to help homeowners who are under water on their mortgages avoid foreclosures has actually pushed more people closer to the edge than it has helped, according to data cited by two House Republicans who say it's time to shut it down before more people are hurt.
The $75 billion program was supposed to help three to four million distressed homeowners, according to th Obama administration, but it has been plagued by mis-management, according to independent evaluations by the Government Accounting Office and the Treasury Department's Inspector-General.
“Over the course of five hearings of the House Committee on Oversight and Government Reform, we have heard bipartisan, near-universal acknowledgement from every observer outside the Treasury Department that this massive government intervention is simply not working,” Representatives Darrel Issa and Jim Jordan said in a letter to Treasury Secretary Timothy Geithner.
"The evidence of HAMP’s failure is overwhelming, and it points to only one conclusion: the program should end immediately,” the two GOPers said.
Issa, who is the ranking Republican on the oversight panel, is from California, while Jordan, who is the top GOPer on a panel subcommittee, is from Ohio.
Under HAMP, 546,035 mortgage assistance applicants were rejected, compared to 346,816 who were accepted, according to Issa and Jordan, citing Treasury Department data.
Issa and Jordan said testimony from mortgage servicers demonstrated that many of those receiving HAMP assistance would have also qualified for privately funded aid if the government program were not available.
"Even many of the homeowners who were kicked out of HAMP received assistance from the servicers’ private programs. According to Treasury data, almost half of the borrowers kicked out of HAMP were able to receive assistance through an 'alternative modification,'" the two representatives said in a statement.
"Under HAMP, taxpayers forced to continue funding a program that squanders their money by providing incentives to banks to modify mortgages that they would have modified anyway."
You can read the full text of the Issa-Jordan letter here.