Refinancing Experts See HAMP Not Halting St Louis Home Loan Foreclosures

With the huge number of reported failures of the federal bailout program known as HAMP, inside senior officials look as if to be jumping on the band wagon displaying their new found pessimistic ideas on where this system may be headed.

There were letters recently shared between one instrumental senator and Neil Barofsky, special inspector general for the Troubled Assets Relief Program (TARP), respecting the subject of HAMP with Barofsky stating that over one-and-a-half million or so consumers would get any type of mortgage assistance.

But the pressing news is that approximately 4 million consumers including St Louis home loan owners that actually require this federal assistance. Yet, most professionals are despondent at the reality of this lot being achieved.

The reason for this bleak outlook is that just under 200000 or five percent have actually advanced from the trial docket into a permanent modification mode.

But if things couldn't be worse, the inspector general's report warned that many homeowners are at danger of re-defaulting on their St Louis mortgage loans even after receiving help under the federal system.

Again the critics are coming out of the wood works suggesting that these mortgage owners are irresponsible. But the truth of the matter is, many still owe more money than what their home is worth not mentioning that others have second mortgages.

Without veering off to a great degree, I think its necessary to mention the abominable acts of not just the huge insurance and banking leviathans but the average person who bought a house they knew they just couldn't afford and did it by taking the only type of loan that could give them this undeserved asset. Then you have the pure fraudulent actions of those who knowingly lied on their stated income application. Two years later, these acts have come to be known as "liar loans."

Getting back to the matter at hand, Barofsky then displays his further skepticism basically alluding that these loan modifications may not be the preferred program to continue offering. The Treasury department had other opinions as to the wide spread criticism.

In a long, drawn out reply included in the memo, Herbert Allison, assistant Treasury secretary for financial stability said the plan "should be measured by how many eligible mortgage owners are able to avoid the pain and stigma of foreclosure by reducing their mortgage payments to affordable levels while either residing in their homes or transitioning with dignity to more suitable housing. The number of permanent modifications is one element, but not the only element of assessing the success."

Whether this federal program meets its overall success or failure is second only to the fact that these key officials want us to view their fundamental beliefs from their viewpoint and no other.

Allison seems to want everyone to grasp that the important reason is not the failing of HAMP, but that Barofsky is simply not measuring its lack of success in the correct manner.

Due to the fact that Allison clearly points out that permanent modifications are really only one way to help grappling homeowners, this somehow suggests that he himself doesn't firmly believe his previous comment.

We cannot ignore the fact that these services are also offering numerous foreclosure prevention initiatives such as short sales as realistic options. It is sad that many of these homeowners both nationally and locally can no longer qualify for any type of St Louis refinancing options.

Yet, most people who have been following this system from its inception were spoon fed the amazing idea that permanent loan modifications through HAMP was the greatest and perhaps the only way the country would see this elusive amount of foreclosures go away.

And as we are finding out, a lot of these modifications did not include a realistic principal reduction, which means in all likelihood, they will continue to fail.

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