The 75 Billion Dollar Question: Why Is HAMP Not an Entitlement Program?

Maxwell, Nicholas T.
May 2012
Iowa Law Review;May2012, Vol. 97 Issue 4, p1305
Academic Journal
The Home Affordable Modification Program ("HAMP"), the Obama administration's response to the foreclosure crisis, has failed to substantially assist the millions of homeowners facing foreclosure. Loan servicers not following the program's directives have refused to modify borrowers' eligible loans. Attempts to enforce the directives through the courts have been ineffective, and servicers continue to flaunt their agreements with the Treasury. Early in the program's history, a federal district court dismissed a class-action lawsuit alleging that HAMP's directives violated procedural due process. By refusing to recognize HAMP as a protected property interest, the court gave borrowers little recourse against servicers that erroneously deny them a modification. For HAMP to be effective, the government must establish a loan modification as a protected property interest and protect it with procedural safeguards.


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