US Treasury Trying to Make it More Difficult for Banks to Foreclose under HAMP

At best, the servicers have been lousy at working with home owners who are struggling to make their mortgage payments. The federal government has offered millions of dollars to servicers who are not helping the tax payers who are paying for these programs. 

New Foreclosure and Loan Mod Laws

Effective June 1, 2010, the HAMP Supplemental Directive prevents a servicer from foreclosing on a property unless the servicer does one of the following items:

1. The servicer determines that a borrower is ineligible under HAMP; or
2. The servicer offers a trial modification but the borrower fails to make the monthly trial period payments; or
3. The delinquent borrower fails to respond within a specified timeframe to a servicer making “reasonable effort” to solicit the borrower; or
4. The servicer is unable to establish "right party contact" after making “reasonable effort” to solicit the borrower; or
5. The servicer's system reflects that the borrower or co-borrower expresses disinterest in pursuing a HAMP modification.

Getting Help with Foreclosure Defense

Additional information is available at Supplemental Directive 10-02.  Homeowners who are struggling to make their first lien mortgage payment and are feeling like their lender or servicer has not worked with them in good faith on a loan modification, should call a bankruptcy attorney for assistance.  Many lawyers are happy to offer prospective clients a free consultation.