Monday, December 7, 2009

Makin' a list, checkin' it twice (daily)

So, this must be the transparency we were promised by the Obama administration.

It wasn’t enough for the Treasury Dept. to send “swat teams” into the offices of loan servicers and forcing them to submit twice-daily progress reports, the two-time tax cheat’s agency will be publishing and naughty and nice list.

The Obama administration vowed yesterday to shame lenders into moving faster to modify troubled home loans, bringing cheers from housing advocates and San Diego owners desperate to hang on to their homes.

The Treasury Department said it would start publishing this month which of the top 70 lenders and services are failing to permanently modify loans as promised. The department threatened sanctions and penalties if lenders fail to meet the participation agreements they signed with the federal government.

“We now must refocus our efforts on the conversion phase to ensure that borrowers and services know what their responsibilities are in converting trial modifications to permanent ones,” said Phyllis Caldwell, the department’s homeownership preservation chief.

Caldwell has the statist logic down pitch-perfect. It’s not strong-arming, it’s social justice. It’s not Chicago-style thuggery, it’s community responsibility.

Since were not sure if this fits snugly into our favored “crony capitalism” description of Obama’s style of governance, we’ll throw it back out there for discussion. Fascism, Socialism, Communism or just good ol’ fashioned “don’t mess with us, chump” brass knuckle politics? Have at it, peeps.

P.S. If we can make the proper arrangements, we have a bit of a bomb-shell to drop with regard to the corruptness of the federal government’s Home Modification Program. Stay tuned.

1 comment:

B-Daddy said...

I'm going with straight up stupidity because this effort, even if successful would only make a difference to a very small fraction of homeowners. The vast majority of troubled loans fall into one of three categories:
1. The mortgagee will work out in their own time and eventually pay the bank back.
2. Even if the loan is modified, the mortgagee is so over their head that they will eventually default no matter what.
3. The mortgagee is so under water that no amount of modification makes sense and it is more rational to walk away from the house and the loan.