Government Makes It Harder For Wall Street To Screw Over Underwater Homeowners

On Thursday, the Department of Housing and Urban Development (HUD) announced changes to a program for deeply underwater mortgages after criticism that it’s been helping Wall Street rather than distressed homeowners. The agency is billing the move as the “most significant improvements to date” for the program.

The Federal Housing Authority (FHA) has been running the Distressed Asset Stabilization Program (DASP) for four years, auctioning off the underwater mortgages that the government took on in the midst of the housing crisis. The program’s rules are supposed to ensure that underwater homeowners get a chance to stay in their homes and that communities are protected from foreclosures and vacancies that can drive down surrounding housing prices. The FHA has sold about 100,000 loans through the program and turned a profit on mortgages that had been keeping the agency in the red.

But the success for homeowners and communities has been less straightforward....
http://thinkprogress.org/economy/2016/06/30/3794542/hud-dasp-changes/