According to a new report from the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), some 306,000 Americans who received help through a government foreclosure prevention program have re-defaulted on their mortgage loans.
The Home Affordable Modification Program, also known as HAMP, was established in 2009 following the subprime mortgage crisis of 2008. The program is administered by the Treasury Department and offers federal subsidies to mortgage lenders in exchange for modifying struggling homeowners’ loan repayments.
The program has spent $4.4 billion of the $19.1 billion it was allocated, and by SIGTARP’s estimate, has cost taxpayers over $815 million on the 306,000 re-defaults. HAMP has been extended through the end of 2015.
SIGTARP reported that participating homeowners are re-defaulting at a rate of 46%, and in every year of the program’s existence, there have been more re-defaults than in the prior year. Over 88,000 more borrowers have missed payments and are currently “at risk” of continuing that trend.
To read the full report, click here.