David Dayen continues to do incredible reporting on HAMP and how it isn’t working for most people who try to use it. What’s particularly important with this piece is that it is built around an individual account of the experience of a homeowner trying to use HAMP to avoid foreclosure. Talking about the success or failure of the mechanisms of a large program is abstract, but Dayen’s reporting here makes the challenges of the program very accessible. One of the biggest challenges consumers have is understanding the financial machinations that surround them – from their mortgage to their credit cards to small business loans. Indeed, our financial crisis was contributed to greatly because systemic complexity lead many Wall Street firms to fail to understand what exactly it was that they were doing.

HAMP should have given consumers an advantage in dealing with banks to keep their underwater homes by simplifying the process and giving clear pathways for a consumer to get cram down or other changes to their mortgage that allowed them make payments and stay in their home. But what we see in articles like Dayen’s is that the process was not more transparent for consumers, which created existentiell levels of uncertainty persist for people who enter the program. This is a really big problem.

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