The US Treasury Department sent a strong message to mortgage servicers participating in the Home Affordable Modification Program (HAMP), urging a ramp-up in renegotiating loans, according to a letter signed by Treasury secretary Timothy Geithner and Housing and Urban Development (HUD) secretary Shaun Donovan. The HAMP distributes Troubled Asset Relief Program (TARP) funds for servicer, borrower and lender/investor incentives on successful modifications initiated. The Treasury’s letter (which can be read here) details three steps the Treasury will take to ensure participating servicers comply, including a scheduled meeting on July 28 to discuss reports of the program’s results. “We believe there is a general need for servicers to devote substantially more resources to this program for it to fully succeed and achieve the objectives we all share,” the letter reads. The letter addresses 25 servicers participating in HAMP, such as CitiMortgage and Wells Fargo Bank, which receive incentives for modifications designed under the Obama Administration’s Making Homes Affordable (MHA) program. The letter requests that servicers designate a senior liaison who will work with the Treasury department on the MHA program. Also, to avoid applications from slipping through the cracks, the Treasury appointed mortgage giant Freddie Mac (FRE) to design a “second look” program that will audit loans that the servicers declined. In the letter, the Treasury asks that servicers increase staff, expand call centers and provide more training for representatives. The letter comes after a mid-June cap adjustment on the Treasury’s TARP fund investments to servicers based on actual participation in the modification program. The Treasury reduced the total amount that CitiMortgage can receive and distribute to borrowers for modifications by more than $991m to a total $1.08bn, as a reflection of actual funds usage. Wells Fargo’s total incentive payment amount received more than $462m in reductions to a revised cap of $2.41bn. Write to Jon Prior.