Treasury Done ‘Very Little’ to Fix Gov’t Foreclosure Prevention Program, Says Watchdog

Treasury Done ‘Very Little’ to Fix Gov’t Foreclosure Prevention Program, Says Watchdog

by Marian Wang ProPublica, March 3, 2011

Making the argument that the Treasury Department has done “very little” to improve a foreclosure prevention program that has failed to meet its goals, the government’s TARP watchdog testified at a hearing on Wednesday that the case for keeping the program alive has worn thin and is “all but exhausted [1]” [PDF].

We’ve documented many of the major weaknesses in the government’s loan modification program—not least of which is its failure to hold banks accountable [2] for withholding permanent loan modifications from struggling homeowners that the program was intended to help.

House Republicans are now considering a bill to end the troubled program [3]. As the Washington Post reports, consumer advocacy groups have argued for fixing the program [4] rather than ending it at a time when so many homeowners still need housing help.

That’s also what the program’s watchdogs have advocated—though they’re now voicing doubts that Treasury will make any meaningful fixes.

“Treasury, it seems, stands alone in defending the status quo,” testified Neil Barofsky, the special inspector general for the TARP program. Barofsky noted that last month, a Treasury official attended a Mortgage Bankers Association conference to discuss enhancements to the loan modification program and said there would be no “major new programs coming out.”

“We may tweak around the edges [5],” HousingWire reported the official as saying.

The Treasury Department has continued to defend the program, arguing that while the program has fallen short of its goals, it has still helped modify about 600,000 mortgages. Ending the program, Treasury has argued, would hurt the housing market [6].

“It would cause a huge amount of damage to a very fragile housing market and leave hundreds and hundreds of thousands, if not millions, of Americans without the chance to take advantage of a mortgage modification that would allow them to stay in a home they can afford,” Treasury Secretary Tim Geithner said yesterday.

Geithner may be right about one thing. As our data shows [7], by the end of last year, the program had given nearly 1.5 million households “a chance” of a mortgage modification through a trial modification. For most, that chance never turned developed into permanent help.


21 Responses to “Treasury Done ‘Very Little’ to Fix Gov’t Foreclosure Prevention Program, Says Watchdog”
  1. pamelag says:

    GMAC stole my home, AG, Congressmen, Obama, BBB, ignored me. Judge covered his ears when it was my turn to speak screaming “i dont want to hear it” so, IVENT, what is the solution here? knowing the banksters are not going to be punished? change the color of $?there is a solution..what could it be?? GOD BLESS AMERICA

  2. Pamela says:

    I vent is right to a certain extent there is a new world order that has been being established and its connection to the Catholic church and the vatican are there for anybody who is interested enough to want to see the bigger picture.I could expound on that and give you the Knights Templar or in modern day terminology the Masons.It never hurts to have people who understand a different theory,as you may be the one who is shocked when these chaos theorys start playing out.Remember Murphy’s law if it can happen it so will.Think about it people ther are bigger powers that be that most of us are not even aware of because we have been blinded by our own stupidity and our sheeple like behavior.

    • l vent says:

      Thanks for that Pamela. There is a bigger picture. It is not always easy to keep an open mind. I had to force myself sometimes to keep this theory in mind but it helped me to keep thinking outside of the box. Just try to keep in mind: black is white.

  3. Vale says:

    The entire modification program is a farce. Chase bank is in the business of stealing homes along with BOA and others. The Dems would have you believe they care about this outright theft of a persons home and the Reps want you to pay 10 times over and beg the bank! All of these banks received bailouts via the taxpayer and Freddie and Fannie still want more money. Don’t look for any assist from the banks or government.

  4. talktotennessee says:

    Having just gone through one of the modification efforts, I can personally testify that there must be some incentive for the mortgage lenders to pretend to help, putting you through the paces without actually modifying the loan. The truth is it is a sham and a farce. I had help with Financial Counselors of America and was denied modification. I submitted everything required and the company refused to disclose the owner of the loan or who denied it. I am discouraged that the government is bankrolling and placating mortgage lenders and servicers by not putting teeth into the program. I am suing the lender, servicer, underwriter and robo-legal office that ‘manufactures’ the foreclosure profits at my expense.
    As a real estate appraiser I can personally assure any who care to listen that the real estate market is not recovering and we are not near the end of the fall. Millions of defaults and REOs are waiting to happen as in many states, values continue to decline, credit is difficult and inventory is climbing. I am amazed at how we in the U.S. until all is beyond repair.

    Maybe its just greed and capitalism as usual. More than individual homeowners will ultimately suffer in the end. We will see city, county and state governments, without enough money to fund schools, programs and services because property tax bases are eroding as values drop.

  5. Katheryn says:

    There were mods & refis, both of which the bank received government funds. After trying for 2 yrs. for a mod. and each time turned down, however, also encouraged to try again. Then quite suddenly we were told that we were pre-approved for what BofA called an “O’bama” refinance. We luckily had savings we were using to make up the deficeit we faced each month. We had also tried to sell our home, but nothing but foreclosures were selling. Now, even those are sitting. The refi to lower our payment to the then current market rate, in this government sponsored refi, cost us $10,000 in points, bank fees and charges. There were no escrows as we pay our own taxes and insurance and it only included a title policy for insurance for the lender. The title insurer was also owned by BofA and cost us as much for just the lender coverage as it cost us three years prior for lenders and owners coverage. They charged us 1.5% in points for a market rate that would have had no points attached. Having no knowledge about any of this stuff when we refied, we were just stalling for time and figured our savings would bleed a little less each month until we could figure something out. The worst part was learning that BofA also received TARP funds for this refi. Not a bad deal for the bank considering they knew they would eventually get the house back and sell it again. They made a quick buck up front, they got taxpayer money to as the cherry on top. Do you think that the average joe knows these kinds of details. Why don’t we see in your face press coverage about facts such as these. Tax payers have a right to know that they are being deceived and their hard earned tax dollars went straight into the bankers pockets under the auspices of helping distressed homeowners. Nothing but fraud, deceit, lies, theft, greed, greed and more greed 🙁

  6. Hope.... says:

    This was all a big front to get free money from our government. Sure we will help these homeowners, knowing full well that they were never gonna live up to their end of the bargain. Sort of like handing someone a million bucks that you don’t know, saying please make good use of this money and help those in need, then the person takes off with the million bucks. Hey, but that is ok…it is ok you took money from the very people that you were supposed to help.

    Then they took the insurance out cause they know many of these mortgages would fail. Then they take your home, sell the home, get the money for the home, then they get a judgement against you as well. Hmmmm someone is making out well and it is not the taxpayers or the homeowners.

    • l vent says:

      I heard an interesting news report yesterday on RT news about how the Government in England told the banksters that they would bail them out but only if the money was used to help the people, otherwise they would shut the banksters down. Not really clear how that played out but it appears they have at least told the banksters that they will be held accountable for misappropriation of funds. In America, land of the free and home of the brave, our Government allowed these sheisters to fraudclose on our own soldiers while they were serving our Country over seas. We The People get no respect from our own “elected” officials and we are being terrorized right here in our own Country by large Multinational Banksters and our Government is allowing this? That is completely UPATRIOTIC and UNAMERICAN. It is a disgrace. They are turning The United States of America into the laughing stock of the world because our own Government has become soo corrupted by an unseen foreign interest who are out to destroy and bankrupt America. .These foreignors hate us, our freedom and our Constitution as well as our Bill of Rights and our right to bear arms. They also hate Independent Countries that Govern themselves, for the people by the people. They need to go away. This is America, not Nazi Germany.

  7. fighting mad, mad as hell says:


  8. fighting mad, mad as hell says:

    There is no housing market, no new sales and no improvement in sight.

    IT’S A ROUND-ROBIN, instead of new owners buying homes to live in, the sales are going from the original foreclosure sale and auctions, then back again on the market as a HUD home. In other words from one agency to another, but counted as an actual home sale.
    We already know that the modifications gave people the same chance of getting a modification as if they did nothing at all.
    After 3 years, why have only 600,000 mods been given? at 4 million foreclosures a year, how can that be? How many homes did it save? How many went thru the process and still didn’t get any help in the end, who were robbed again and still got no modification?
    But the servicers got more than $2000 for every case they worked on but didn’t get a mod! They were only paid $400 for every mod that was completed, which do you think was most popular?
    It’s all smoke and mirrors, lies and deceptions, stall and delay and foreclose anyway.
    And despite the small victories we’ve had, the bankers are still in charge and doing whatever they want.

  9. Pamela says:

    I agree with I vent little has been done and modif. was only meant to legal up the paper work in so far as that can be done.Modif. was meant to take more rights away from home owners so that when thier set up to fail modif. went under they were left with no recourse in foreclosure, I’m guessing a great many people did not see it this way and that was not explained to them….or else why would they have signed the paper work.Banks and so forth want to make us out as too stupid to understand any of this .If they only realized a lot of people are on to them and have been for quite sometime,maybe some of this would have been avoidable.You reap what you sow and kharma will all ways win in the end.

  10. l vent says:

    TARP only acheived one thing, the Multinational Banksters and their minions, were able to rob the people of more of their wealth with the blessing of our own Government, clearly against the will of the people, right in front of our faces. What followed that was just more robbery of the people but more insidious, like the foreclosure fraud, with the back door secret bailouts, Qe2 by the Fed (more robbery of the people by debt creation) and the underhanded fraudclosures. America must send the foreign banksters packing. The fanatical financial terrorism needs to stop. This is America and they obviously hate us and they do not have any respect for us and they do not belong here.

    • l vent says:

      And give those people back those houses YOU STOLE and stop the FRAUDCLOSURES!

    • CaitlinO says:

      I really don’t understand this comment. There ain’t nothing foreign about Richard Fuld, Ken Lewis, Brian Moynihan, Jamie Dimon, Lloyd Blankfien, Angelo Mozilo, Charles Prince, Robert Rubin, George Bush, Tim Geithner, Larry Summers, Hank Paulson, Alan Greenspan or Roland Arnall. They’re all good ole’ Amurrican lying thieving feckless rapacious slimeball capitalists.

      Who needs foreigners when we have such outstanding con artists right here at home?

      • l vent says:

        BofA and Chase are NOT American owned banks. These banks are owned and controlled by the foreign Mutinational Banks. The Federal Reserve and the Treasury are owned and controlled by the World Bank as are all Central Banks. Goldman Saks is one of the largest SMOM/JESUIT/VATICAN banking proxies in the world. They employ Americans, but they are only a front for who is really running the show so to speak. Those people that you mentioned are only the puppets. The real owners are the people hiding behind the scenes and it is all very deceptive. Same thing with the large Multinational Corporations. Nothing is as it seems. But do not take my word for it, the truth is not that hard to find out. You might be shocked at what the truth really is and it is not what we have all been lead to believe unfortunately.

      • l vent says:

        A lot of have been hoodwinked and the whole country is being run like a gigantic Ponzi scheme based on fraud. It is all soo corrupt. We do not really need to look that deep into who is behind all of this fraud and corruption and it is not who any of us may have thought. You may be shocked to find out, as I was, that we are all really living in the Holy Roman American Empire..Go to you tube and search for: True History of the Jesuits-by Eric Phelps. He wrote a very interesting novel entitled: Vatican Assasins: Wounded In The House Of My Friends based on many years of research and facts to back up his information. The you tube video is an interview about this novel and it is pretty shocking info if you have never heard about any of this stuff before. The hard truth is out there..

      • l vent says:

        According to some experts, we are really being ruled by a foreign monarch, the Papal Caeser and we are all living in his Jesuit Empire because he was given The Doctrine of Temporal Power. I know, I know, it all sounds crazy. Imagine my shock as I have always been a very devoted lifelong Catholic. Let’s all do our homework and see what we can find out about this and let’s report our findings back to each other here. Fraudclosuregate has caused a nationwide quest for knowledge into how and why this financial crisis has happened to all of us. You have to get really pissed off to really want to seek the truth. They can all only blame themselves now because they are all soo greedy and power hungry. Their ruling by secrecy days are over. God and the internet saw to that. Now we all need to seek our own truth and draw our own conclusions because they hate that. They want us all the dumber, the better. That has to stop. They are out to Destroy America and they are a bunch of destroyers and haters. God Bless America.

      • l vent says:

        They are A/K/A the New World Order.An elite cabal of Megalomaniacs.

      • CaitlinO says:

        If I were you, 1vent, I’d take off the tin-foil hat. It seems to be pinching your brain.

      • l vent says:

        @CaitlinO: I know it is hard sometimes to think outside of the box. You have to though, in order to see the bigger picture. It takes a pretty open mind because there is alot of info to sort through. If I would have gotten that loan mod. which I clearly qualified for, I most likely would not have went digging around, seeking truth. I had to get really mad to take a look around, so to speak I felt there was more than met the eye and more than we were being told, underneath it all., I am not telling anyone to believe this because it is too much for some people. I am just saying we might want to take a look around and try to keep an open mind because you will need it. You might be really shocked at what you might find out about what the truth really is. Believe me, I was.

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