Joe Kriesberg, director of the Massachusetts Association of CDCs, is tired of hearing people bash HAMP. He wrote this piece about it last December, and it’s only gotten worse since Republicans have targeted the program for extinction.
His argument is simple: the program has helped 700,000 people obtain permanent modifications, which is hundreds of thousands more homes saved than anything else we’ve done. Nothing else has come near that scale.
Did it not hit its targets? Yes. Is its process flawed? Yes. But 700,000 modifications is better than 700,000 more foreclosures.
In Mass., he notes, “10,535 homeowners have received a modification during 2010 compared with 11,334 homeowners who have lost their home to foreclosure. In other words, without HAMP, the problem would be nearly
twice as bad” last year. Since he wrote his post in December, that number has grown to 14,738 Massachusetts homeowners. In Boston, according to a recent report, the City of Boston and its nonprofit partners have used HAMP and other tools to avert 1,117 foreclosures over the past two years — more than double the 422 owner occupied homes that were foreclosed during that period. Given the economy and the collapse of home values, this rate of success is remarkable and would not be possible without HAMP.
“It’s like that quote about democracy,” Kriesberg told me last week at the NACEDA conference. “Democracy is awful. It’s the worst form of government. Except for every other kind there is. HAMP is like that.”
Kriesberg also worries that the negativity about HAMP has now been extended to all foreclosure prevention efforts; this undermines efforts to secure funding for foreclosure counseling programs. If nothing works, it just reinforces the public perception that government programs are a waste of money.
He also argued that it was naive to think that if HAMP is killed, the money could be directed anywhere but deficit reduction. (For an alternative view see this post.)
There are those who have argued that the terms of HAMP mods are so ungenerous — no principal reduction or fee waivers, extended term lengths — that they just don’t amount to a good deal. That plus the problems where people who were underwater but current were harmed by the HAMP process through dual track trial mods and foreclosure proceedings or who had their trial mods not approved and couldn’t make up the balance.
Kriesberg acknowledges these shortcomings and agrees with efforts to fix and improve HAMP. But would it have been better to let another 3/4 million homes go into foreclosure? Have the critics allowed themselves to become coopted by forces who just want to abandon the attempt entirely? How do we come to a unified voice on HAMP?