The US Treasury Department plans to publish ratings on servicer quality in implementing the Home Affordable Modification Program (HAMP), according to testimony from Herbert Allison Jr., the assistant secretary for Financial Stability, before a US Senate committee hearing.
HAMP provides cap incentives to servicers for the modification of loans on the verge of foreclosure and adjusts those caps based on servicer performance.
The Treasury reports the amount of cap incentives received by servicers participating in HAMP on the Troubled Asset Relief Program (TARP) transaction reports, and as of July publishes a monthly servicer performance report.
HAMP may exceed the Administration’s target of 500,000 trial modifications by November 1, Allison said.
“Nonetheless, we are receiving complaints as well from homeowners who are anxious and who are not receiving their responses as fast as they would like,” Allison said. “We are also going to be publishing reports on the service quality of the bank, and we hope that that daylight being shown on servicer quality is going to show additional impetus for them to improve their service quality.”
Allison also said the Treasury would be streamlining the process consumers use to provide documentation to their servicers, and progress on that would come over the next few weeks and months.
“We have to reach out more to people across the country to make sure they’re aware of the program,” Allison said. “Modifying mortgages is a homeowner by homeowner operation. It’s intensive. It requires personal counseling. We need to reach out and contact as many people as possible.”
A spokesperson at the Treasury told HousingWire the details of the new servicer quality ratings report are still in the development stages and will be released in the coming months.
Currently 57 servicers participate in HAMP and, according to the latest servicer performance report, started 360,00 trial modifications, led by Saxon Mortgage Services which started trial modifications for 39% of its eligible delinquency portfolio.
In his testimony this week, however, Allison said servicers have sent over 2m inquiries and trial modifications are approaching 400,000.