Financial Reform Watch

Published — October 27, 2010 Updated — May 19, 2014 at 12:19 pm ET

Where’s the HAMP loan data?

Introduction

The Treasury Department should stop dragging its feet and release some of the specific loan-level data it has collected from mortgage servicers in the Home Affordable Modification Program (HAMP), a consumer advocacy group says.

“For over a year, it has promised to release the loan-level data to policymakers, researchers, and the public, but whenever asked, the promised date of release is pushed back,” Julia Gordon, a lawyer with the Center for Responsible Lending, told the Congressional Oversight Panel on TARP at a hearing today.

The data – once scrubbed of names and Social Security numbers – can shed light on which borrowers are getting HAMP modifications, the types of modifications being provided, and patterns of re-defaults that are occurring, she said. “Given the significant racial and ethnic inequities that have plagued the mortgage market, detailed demographic data for each servicer is of vital importance to all stakeholders,” she added.

Gordon also said one of the first priorities of the Consumer Financial Protection Bureau should be to “quickly move to regulate the [loan] servicing industry” and whether they are complying with contractual obligations to the Federal Housing Administration and the Veterans Administration. The bureau officially opens its doors in July with wide-ranging powers to write regulations that protect consumers from abusive practices by the financial services industry.

Likewise, the FHA and VA should ensure their loan servicers are following all relevant laws, Gordon said. And the Housing and Urban Development Department should terminate contracts with loan servicers that don’t follow the rules, and disclose the “loss mitigation” efforts by servicers to renegotiate mortgage terms to help homeowners avoid foreclosure, she said.

The Dodd-Frank reform law requires loan servicers to disclose how they arrived at the decision to deny a loan modification. The Treasury Department is also required to create a website so homeowners can access the HAMP program’s net present value model and see if loan servicers used it accurately in their case.

HAMP, created in early 2009, offered $50 billion in incentives for U.S. banks to restructure home mortgages and initially projected the program would help 3 to 4 million homeowners. However, as of last month, only 429,000 mortgages were permanently modified under the program.

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