Last week, Timothy Geithner laid into mortgage servicers participating in HAMP during prepared comments before the Senate Subcommittee on Financial Services. “I want to be clear,” he said, “that we do not believe servicers are doing enough to help homeowners, not doing enough to help them navigate the difficult and often frightening process of avoiding foreclosures.” He then went on to notify the subcommittee that the Treasury will soon “hold servicers accountable” for their progress in HAMP by publishing much more detailed data on their performance.

The Treasury Secretary’s comments are likely in response to criticism from the Congressional Oversight Panel (COP)’s criticisms in early April that HAMP just wasn’t doing the job that it had been promised to do. While the Treasury projected that 3 to 4 million borrowers could be helped through HAMP, by the end of March 2010 servicers had converted 227,922 loans of more than 1 million trial mods to permanent status, placing them woefully behind schedule for their ambitious – and not particularly well-researched – projections.

The COP has been blunt: “It now seems clear that the Treasury’s programs, even when they are fully operational, will not reach the overwhelming majority of homeowners in trouble,” the panel wrote in its April oversight report.

Geithner’s answer to this criticism? He’ll whip those recalcitrant lenders into shape and make sure he releases a report on the “baddies” who are not giving out loan mods the way that they should.

Is this starting to sound familiar?

Meet those quotas, and give out those loans. Get those incentives and make sure that you are keeping up to our standards, reasonable or not, or face seriously bad PR and all sorts of pressure on all sides that could destroy your business and your livelihood. Give out loans whether people really qualify or not – just this time, make them loan mods so that there is another – temporary – lull in the foreclosure action. Sounds like the policies that created the problem HAMP is trying to resolve in the first place.

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