The Making Home Affordable program was announced in 2009, by the Obama Administration, as a relief to distressed homeowners. The MHA program’s objective is to provide guidelines to lenders to modify the terms of eligible mortgages so that “at-risk” homeowners would be able to reduce their monthly mortgage payments and to avoid foreclosure. According to the most recent MHA Program Performance Report, during the last 7 years, the MHA program has only helped 2.5 million of the 7 to 9 million homeowners that were identified as “at-risk” by the Obama Administration in 2009. This means that the remaining 4.5 to 6.5 million “at-risk” homeowners who do not submit their request for borrower assistance by December 31, 2016, will be faced with foreclosure.
SD 16-03 provides the following modifications to the MHA handbook for winding down the program:
- All borrower requests for assistance under MHA must be submitted by December 31, 2016;
- On December 1, 2017, MHA Help and the Home Affordable Modification Program (HAMP) Solution Center will no longer accept new cases, nor escalate cases to servicers;
- All cases that have been escalated prior to December 1, 2017 must be resolved by May 1, 2018;
- After December 30, 2016, servicers will no longer be required to assign relationship managers to borrowers;
- Effective May 1, 2018, servicers will no longer be required to follow Section 3 of Chapter 1 of the MHA Handbook; however, the Treasury suggests that servicers continue to follow the best practices that have been established by MHA;
- After September 1, 2016, servicers are no longer required to satisfy the Reasonable Effort standard set forth in Section 2.2.1 of Chapter II of the MHA handbook; and
- Servicers will not be required to suspend a scheduled foreclosure sale if a borrower submits an Initial Package after December 30, 2016.