From Capitol Hill: Written Testimony before the House Financial Services Committee, Subcommittee on Housing and Community Opportunity on September 9, 2009

Chairwoman Waters, Ranking Member Capito and members of the Committee, thank you for the opportunity to testify today about the Treasury Department’s comprehensive initiatives to stabilize the US housing market and support homeowners…

Program Limitations
Finally, we recognize that any modification program seeking to avoid preventable foreclosures has limits, HAMP included. Even before the current crisis, when home prices were climbing, there were still many hundreds of thousands of foreclosures.

Therefore, even if HAMP is a total success, we should still expect millions of foreclosures, as President Obama noted when he launched the program in February.

Some of these foreclosures will result from borrowers who, as investors, do not qualify for the program. Others will occur because borrowers do not respond to our outreach. Still others will be the product of borrowers who bought homes well beyond what they could afford and so would be unable to make the monthly payment even on a modified loan.

Nevertheless, for millions of homeowners, HAMP will provide a critical opportunity to stay in their homes. It will bring relief to the communities hardest hit by foreclosures. It will provide peace of mind to families who have barely managed to stay current on their mortgages or who only recently have fallen behind on payments. It will help stabilize home prices for all American homeowners and, in doing so, aid the recovery of the U.S. economy.

Conclusion
In less than six months, including the initial start-up phase, HAMP has accomplished a great deal and helped homeowners across the country. But we recognize the continued commitment needed to help American families during this crisis and will aggressively continue to build on our progress to date. For example, we are taking additional steps to expedite program implementation and increase take-up, including: implementing the Foreclosure Alternatives Program and strengthening the HOPE for Homeowners refinancing program. Each of these supplemental programs, along with the Second Lien Program and Home Price Decline Protection Incentives is designed to increase the effectiveness and take-up of the first lien modification plan.

Sustained recovery of our housing market is critical to lasting financial stability and promoting a broad economic recovery.

Read the entire written Testimony on Stabilizing the Housing Market before the House Financial Services Committee, Subcommittee on Housing and Community Opportunity here.

Filed under: Current Events, Finance, Foreclosure, Mortgage, Real Estate Market, Tax Issues