Lower the borrower debt-to-income (DTI) ratio for modifications to below 31%; in other words, allow for lower monthly payments on modifications. Allow for principal reductions on modified loans. Make additional funding available for housing counseling groups. Require underperforming servicers in HAMP to outsource to servicers that perform.
Ocwen recommends improvements to HAMP
Ocwen Financial Corporation president Ronald Faris, testifying before Congress, voiced the mortgage servicer's support of the Administration's Home Affordable Modification Program (HAMP) and recommended enhancements that Ocwen believes would make the program more effective at preventing foreclosures and helping distressed homeowners. "Almost a year into HAMP, too many homeowners facing foreclosure are having difficulty getting their loans modified. In our view, this is due mainly to a lack of sufficient capacity and expertise in the industry to handle the volume," Faris told the Domestic Policy Subcommittee of the House Oversight and Government Reform Committee. In his testimony, Faris noted that HAMP is a "well designed response to the mortgage crisis" and commended "the Treasury Department for its aggressive implementation of the program." He recommended the following enhancements to HAMP: