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House Votes to Terminate Government's Mortgage Modification Program

UPDATED to reflect vote count of 252 to 170. The count was incorrectly stated previously as 218 to 109.

The U.S. House of Representatives passed legislation Tuesday evening to end the administration’s flagship foreclosure prevention initiative, the Home Affordable Modification Program (HAMP).

The HAMP Termination Act (H.R. 839) passed the House in a 252 to 170 vote. Pundits are calling it a largely symbolic vote since the bill is not expected to win as much favor in the Senate, although Republican senators have already introduced their own bill to pull the plug on the federal mod program, which is identical to the House bill that passed.

The White House had previously stated the president will veto any HAMP-ending legislation should it land on his desk. The Office of Management and Budget reiterated that threat Tuesday.

In a newly released statement of administration policy, the agency said, “The administration strongly opposes House passage of H.R. 839….As tens of thousands of responsible American homeowners struggling with their

mortgages receive permanent assistance each month from HAMP, the administration believes that continuation of HAMP is important to the nation’s sustained economic recovery.”

While HAMP has come under heavy fire for falling short of its original goal to put 3-4 million homeowners in modified loans, there are at least some lawmakers who believe the answer lies in revamping, not ending, the program.

Late Monday, ahead of the House’s scheduled vote, a coalition of 50 Democratic legislators, including Reps. Barney Frank of Massachusetts and Maxine Waters of California, penned a letter to Treasury Secretary Timothy Geithner.

In the letter, they sided with their Republican counterparts in describing HAMP’s results thus far as “disappointing,” but they urged Geithner to make the necessary changes to bring the program up to par.

Their recommendations mirror many of the servicing guidelines that state and federal officials are pushing as part of the highly publicized robo-signing settlement. Among them, ensuring borrowers have a single point of contact throughout the HAMP application and evaluation process, and suspending foreclosure actions while the borrower is being evaluated for the program.

The HAMP Termination Act is the fourth federal foreclosure mitigation program the House has voted to end. Earlier this month the chamber passed measures to end HUD’s Neighborhood Stabilization Program, FHA’s Short Refi Program for underwater borrowers, and the Emergency Mortgage Relief Program established to provide temporary bridge loans for unemployed homeowners.

The White House has vowed to veto all measures should they make it that far.


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