HAMP Starts Review of Mortgage Modification Trials

The U.S. Treasury has ordered a review of all mortgage modification trials set to expire on or before Jan. 31, 2010, as part of the Obama Administration’s efforts to accelerate permanent mortgage relief and rescue more borrowers from foreclosure. Administrators of the government’s Home Affordable Modification Program, or HAMP, posted the announcement on its website alerting servicers that they need to “reach out to borrowers.”

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Study Finds Political Ties to TARP Bailouts

A new study finds that banks with connections to members of Congressional finance committees, and banks whose executives served on Federal Reserve boards were “more likely to receive funds” from the Troubled Asset Relief Program, the government’s primary bailout program. “Banks with strong political connections were more likely to receive bailout money from the government — and more of it — in the past year than those with weaker ties,” concluded the study from Ran Duchin and Denis Sosyura, professors at the University of Michigan’s Ross School of Business.

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Only 24% of Eligible Getting Mortgage Modifications

The underperformance focus of the government’s primary mortgage-relief program has centered on how many payment reduction trials have been made permanent. But the larger question is why only one-in-four of those eligible are getting any help at all. The latest report from the U.S. Treasury on Making Home Affordable, also known as HAMP, shows that 24 percent of those eligible, borrowers 60 days or longer delinquent on their mortgages, begun trial or permanent modifications with lower monthly payments. That’s 759,058 out of 3.299 million borrowers.

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Wells Fargo to Repay $25B, Last Big One to Square Up

San Francisco-based Wells Fargo today said it would repay its $25 billion in bailout money, making it the last major bank to reach a deal to wipe the slate clean with the U.S. government. The Wells Fargo announcement came on the same day that Citigroup said it would repay it’s $20 billion it received under the government’s Troubled Asset Relief Program, or TARP. Bank of America returned $45 billion in TARP money last week.

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Citigroup to Repay $20B in Bailout Funds, Exit TARP

After scrambling for days to reach a deal with U.S. regulators, banking giant Citigroup – one of the most troubled icons of the financial crisis – announced today it has reached an agreement to repay $20 billion in bailout funds and “terminate the loss-sharing agreement” with the government. “We owe the American taxpayers a debt of gratitude and recognize our obligation to support the economic recovery through lending and assistance to homeowners and other borrowers in need,” said Citi Chief Executive Officer Vikram Pandit.

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Mortgage Modifications: Can They Succeed in Current Crossfire?

The Obama Administration’s mortgage modification effort to rescue homeowners from foreclosure is caught in a crossfire. On one side, the lenders say they are struggling to get borrowers on board with tough paperwork rules that require additional staff – a bureaucratic “struggle,” a top lender called it. On the other side, administration officials are now formulating financial penalties and other actions against the mortgage servicers that they determine are not keeping pace.

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Citigroup Chief Set to Push for Bailout Repay Deal

It is shaping up to be a whirlwind stay in Washington, D.C. next week for Citigroup Chief Executive Vikram Pandit, as he reportedly plans to meet with President Obama and try to negotiate a bailout repayment deal with officials. Pandit reportedly wants out of the unenviable spot of being the remaining top bank chief not to orchestrate a repayment of Treasury bailout funds under the Troubled Asset Relief Program. He is reportedly seeking to hash out a deal next week.

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Hotly Debated 'Cram-Down' Lets Judges Redo Mortgages

Mortgage bankers and broker-dealers are strongly opposing the so-called “cram-down” amendment – allowing judges to modify mortgage terms in bankruptcy cases. The amendment is now attached to a broader financial reform bill in the House that may come to a vote today. The controversial provision, introduced by Rep. John Conyers, D-Michigan, chairman of the House Judiciary Committee, would allow bankruptcy courts to reduce mortgage interest rates, adjust principal balances or extend the term lengths of mortgages to rescue homeowners who face foreclosure.

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Obama May Tap Forum's Ideas for Small Business Bailout

Obama Administration officials are considering a mechanism for re-shifting bailout money to rescue small businesses still mired in a tight credit market. The strategy for refocusing bailout funds will likely, to some extent, come from a host of ideas presented to President Obama seven days ago in a report by the U.S. Treasury titled, “Small Business Financing Forum.”

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