Home / News / Foreclosure / Treasury to Withhold Foreclosure Prevention Incentives from Two
Print This Post Print This Post

Treasury to Withhold Foreclosure Prevention Incentives from Two

The ""U.S. Treasury"":http://www.treasury.gov said Wednesday that it will continue to withhold incentives from ""JPMorgan Chase"":http://www.jpmorganchase.com and ""Bank of America"":http://www.bankofamerica.com for modifications, short sales, and deeds-in-lieu completed through government programs.
[IMAGE] JPMorgan is the only servicer participating in Treasury's Making Home Affordable program that was determined to need ""substantial improvement"" in complying with program guidelines during the third quarter.

The company â€" now said to be the largest U.S. bank by assets â€" was also in need of ""substantial improvement"" during the first and second quarters of this year. JPMorgan's servicer incentives have been withheld since the first assessment was made at the conclusion of Q1.

Treasury called out JPMorgan ""in its report"":http://www.treasury.gov/initiatives/financial-stability/results/MHA-Reports/Documents/October%202011%20MHA%20Report%20FINAL.pdf for the servicer's ""lack of progress in implementing previously identified improvements.""

Bank of America was given a grade of needing ""substantial improvement"" during the first and second quarters, but moved up a notch on the assessment scorecard to needing only ""moderate improvement"" for the third quarter.

Still, Treasury says it ""will continue to withhold servicer incentives from Bank of America, NA, until it makes additional improvements.""


Treasury's quarterly compliance assessments cover the 10 largest servicers participating in the Making Home Affordable program.

Six other servicers were also found to need ""moderate improvement"" during the third quarter: American Home Mortgage Servicing, CitiMortgage, GMAC Mortgage, Litton Loan Servicing, Ocwen, and Wells Fargo. Incentives are not being withheld from any of these program participants.

Two servicers met the established benchmarks for program compliance, indicating that they require just ""minor improvement"" on the areas reviewed for the third quarter: OneWest Bank and Select Portfolio Servicing.

Treasury says when Making Home Affordable began, ""most servicers did not have the staff, procedures, or systems in place to respond to the volume of homeowners struggling to pay their mortgages, or to respond to the housing crisis generally.""

Officials note that participating companies have taken specific actions to better their servicing processes. ""While the servicers have improved their performance, they still have more progress to make,"" according to Treasury.

Treasury says its decision to make individual servicer assessments public is intended to push servicers to correct identified shortfalls.

Treasury notes that participation in Making Home Affordable â€" including the Home Affordable Modification Program (HAMP) and the Home Affordable Foreclosure Alternative (HAFA) programâ€" is voluntary.

As such, Treasury does not have the authority to impose fines or penalties, but can take certain remedial actions for non-compliance such as withholding incentive payments.

About Author: Carrie Bay

Carrie Bay is a freelance writer for DS News and its sister publication MReport. She served as online editor for DSNews.com from 2008 through 2011. Prior to joining DS News and the Five Star organization, she managed public relations, marketing, and media relations initiatives for several B2B companies in the financial services, technology, and telecommunications industries. She also wrote for retail and nonprofit organizations upon graduating from Texas A&M University with degrees in journalism and English.

Check Also

Cenlar’s Enterprise Portfolio Management Office Adds Three New Directors

The mortgage subservicer fortifies its Enterprise Portfolio Management Office with the addition of three new Directors, all responsible for driving and implementing strategic programs within the company.