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US Treasury admits HAMP effectiveness is a mirage

Several weeks ago I watched Treasury Secretary Geithner dodge questions

about the mortgage modification mess that is HAMP (Home Affordable Mortgage
Plan). The week before I watched Press Secretary Robert Gibbs do the same
thing. It is that the mortgage modification law exists, but the federal government,
and the US Congress, are going to do nothing to enforce it. This past week it
was made clear that the nation’s Judicial Branch was moving to pick up the
slack.
Mandelman posts an article today that confirms all of that. Now since everything
Mandelman does and writes about the mortgage modification mess is non-profit
and political commentary, he does his typical rant and rave about the situation. If
you’re as angry as Mandelman is, then you should follow the link below and read
his article.

I on the other hand, more than Mandelman, am concerned with any practical
solution to an individual distressed mortgage owner solving their mortgage
dilemma. The answer, as Mandelman will tell you, is the REST Report. Every
post I’ve written since the end of June advises the REST Report. Why? Because
it is proving itself as the one, single, effective method to reconcile a distressed
mortgage: either through a beneficial mortgage modification, or an effectice short
sale of your property.

Two weeks ago, Mandelamn interviewed a homeowner who had struggled for 14
months to get his loan modified. He finally did in a few short weeks after sending
in a REST Report. This is huge. If you have a distressed mortgage, read on only
if you have time. When you decide you come first, your next call should be to
me. I sell the REST Report.

No one knows more about the mortgage modification mess than Mandelman, as
will become apparent at reading any article he posts. Among other credentials,
he was an advisor to the US Congress and the Federal Trade Commission on
the recently enacted Financial Reform Bill.

To condense Mandelman today:

It all started this past August 16th and 18th, when the Treasury Department
invited some bloggers to come hear what Tim Geithner and other nameless
Treasury officials had to say on a range of topics, including the foreclosure crisis
and the Home Affordable Modification Program, HAMP.
Treasury Department officials said, in no uncertain terms that they knew HAMP
wouldn’t save homeowners from foreclosure. The administration knew they’d
only reach a fraction of those needing help, the official claimed, and that millions
of homeowners would ultimately lose their homes to foreclosures that the
administration chose not to prevent. Nevertheless, HAMP remains the best
option — even though it’s reaching fewer borrowers than forecast. HAMP
prevented an outbreak of foreclosures exactly when the system could have
handled it least.

The big idea was; pass a law, look good, and then ignore enforcement.
The reader needs to understand the term, “shadow inventory,” those with
severely delinquent mortgages, in foreclosure or already repossessed that have
not yet been put on the market — has significantly grown since the
administration took office and is estimated to range from 5 to 7 million homes.
Through June, borrowers in foreclosure have been delinquent for an average of
461 days before being evicted from their homes, according to Jacksonville, Fla.-
based data provider Lender Processing Services.

Cherry-picking from Mandelman’s observations:

1. President Obama appointed Timothy Geithner to be Treasury Secretary. As
president of the Federal Reserve Bank of New York, Geithner served under a
board of directors headed by JP Morgan Chase CEO Jamie Dimon. Geithner
had been partly responsible for the decision to let Lehman Brothers go under, for
TARP (Troubled Asset Recovery Program), and for American International
Group (AIG) paying its creditors with taxpayer money. As his chief of staff,
Geithner chose a former lobbyist for Goldman Sachs.
2. President Obama: “The recession was caused by a perfect storm of
irresponsibility and poor decision-making that stretched from Wall Street to
Washington to Main Street.”
3. On February 10, 2010 Obama said that he didn’t “begrudge” the $17 million
bonus awarded to Dimon and the $9 million to Goldman Sachs CEO Lloyd
Blankfein. “I know both guys. They are very savvy businessmen.”
4. A group within the White House that began calling themselves the “pitchfork
gang,” said their attempts to persuade Obama take a tougher stance on Wall
Street were undermined by Geithner and by National Economic Council head
Larry Summers. Geithner and Summers were apparently worried about
upsetting business confidence.
5. In the stimulus’s first year, the administration spent only $17 billion of the $139
billion allocated for infrastructure spending.
6. Geithner and Summers repeatedly blocked attempts to get tough on Wall
Street on the grounds that doing so would threaten the recovery itself by
upsetting the bankers.
Just on one day I’d like to see Obama come out in favor of cream in coffee, just
so I could watch some knucklehead Republican oppose it on Face the Nation.
“No, I say there should not be cream in coffee.”
Back to the distressed mortgage owner that Mandelman interviewed: At the end
of the interview Mandelman asked him if he had anyone to talk to through the
experience and he explained that he didn’t. Not the sort of thing you talk about,
he explained. Through 14 months of being put through hell by his bank, through
13 SCHEDULED SALE DATES THAT WERE EACH POSTPONED AT THE
LAST MINUTE… and he never told his wife until it was over and his got his
modification. And again, he got it two weeks after purchasing the REST Report.

Call me at: 970-242-2600

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