Administration Revamps HAMP to Reach More Borrowers

The Obama administration has announced changes to its flagship foreclosure prevention initiative – the Home Affordable Modification Program (HAMP) – which officials say will expand its reach to more distressed homeowners.

Among the changes, borrowers who are struggling because of debt beyond their mortgage will be eligible for a secondary evaluation with more flexible debt-to-income criteria, and eligibility will be extended to investor-owned homes that are used as rental properties.

The administration is also giving principal reductions a bigger role within the program, tripling incentives for investors that agree to write down an underwater borrower’s principal and offering these same incentives to the nation’s two biggest mortgage investors – Fannie Mae and Freddie Mac.

The deadline for HAMP will be extended for an additional year through December 31, 2013.

(developing story)

*Additional details have been provided in a blog post by Tim Massad, assistant secretary for financial stability.

More here: