Oversight Panel Releases Report on Foreclosure Crisis

Earlier this month, the Congressional Oversight Panel issued its latest in its series of reports on the continuing financial crisis. The focus of this latest report is the foreclosure crisis that has been become increasingly dire. The report sets out a roadmap the Panel intends to be used by those "who are developing programs to address foreclosure mitigation whether they are local, state or federal policy makers or private groups looking to help." According to the report, any successful program to address this crisis must address the following issues:

• Will the plan result in modifications that create affordable monthly payments?
  
  
• Does the plan deal with negative equity?
  
  
• Does the plan address junior mortgages?
  
  
• Does the plan overcome obstacles in existing pooling and servicing agreements that may prevent modifications?
  
  
• Does the plan counteract mortgage servicer incentives not to engage in modifications?
  
  
• Does the plan provide adequate outreach to homeowners?
  
  
• Can the plan be scaled up quickly to deal with millions of mortgages?
  
  
• Will the plan have widespread participation by lenders and servicers?

In addition to the roadmap, the report also provides an assessment of President Obama’s Homeowner Affordability and Stability Plan, and examines the extent to which it addresses many of the key issues identified in the report.

As with all the other Congressional Oversight Panel reports, Rep. Jeb Hensarling voted against the release of the document.

The full text of "Foreclosure Crisis: Working Toward a Solution" is available at: http://cop.senate.gov/documents/cop-030609-report.pdf