The Administration’s mortgage-modification program may lack the financial heft to make it worthwhile for banks to offer homeowners meaningful change
The news coming out of the U.S. Treasury Dept. seemed like red meat for angry homeowners: The feds are going to get tough with mortgage servicers. Officials said the banks were moving too slowly in making lasting changes to the loans of struggling homeowners. Loan servicers that don’t deliver, warned Michael Barr, Treasury’s assistant secretary for financial institutions, “are going to suffer the consequences.”
But what exactly are those “consequences?” Barr wouldn’t go into detail with reporters on Monday. The terms laid out in Treasury’s contracts with the banks may not leave the government much room to maneuver.
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