Picture a life raft made of sponge. Though a bit extreme, it’s a good illustration of how I view HAMP (Gov. loan-mod program) and HAFA (Gov. short sale program). Though they were designed to help us consumers and protect the overall housing market, evidence has shown that they haven’t done nearly as much as initially designed to do. According to Obama, the HAMP program was designed to “offer help” to keep 4 million borrowers in their homes. As of June 30th, 753,275 loans have been modified on a permanent or trail basis. As for HAFA, it’s still too early for official results. But as President of a company who helps up to a hundred short-sellers a month, I can confidently say that the results seem to be no different than HAMP.
Now, are you ready to get mad?
Let’s focus on the loan mods that have taken place through HAMP. After last weeks headlines resulting from the U.S. Treasury’s latest HAMP report card, one would likely have thought the program a huge success. After the report card was published, multiple media outlets trumpeted impossibly miniscule re-default rates of only 1.7% among permanent HAMP mods. Many of us said, “that’s impossible!”, and we dug deeper.
Buried in the fine print at the bottom of the report card is this statement: “a HAMP permanent modification is canceled for non-payment if it is more than 90 days delinquent.” So, true delinquencies (90+ days) are thrown out. If that’s not deception from the government, I’m not sure what is…
I’m really not a conspiracy theorist and I’m trying to remain optimistic through these difficult housing times, even if just for our clients. But reading information like this, it’s hard not to feel insulted and misled by our government.
Over the next six months, year, two years, I’m really hoping that we can find something solid to anchor to in this tumultuous housing market. Though the waves are big and tides unpredictable, we appreciate you placing your trust in us to navigate your short sales for you.
If you are considering a short sale and looking for a professional, experienced operation to help, please visit our Borrowers section to get started.
– Jeff Grant, President, ShhortSale.com