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HAMP: Doomed from the Start

Cornell Real Estate Review, Forthcoming

50 Pages Posted: 15 Aug 2011 Last revised: 8 Nov 2012

Marc Gans

University of California, Los Angeles (UCLA) - School of Law

Date Written: April 6, 2012


In February 2009, President Obama’s response to the foreclosure crisis was the Home Affordable Mortgage Program (HAMP), designed to help as many as 4 million borrowers avoid foreclosure by the end of 2012. HAMP was the largest part of a broad array of programs called Making Home Affordable (MHA), which itself was part of the $700 billion TARP bailout. $75 billion was set aside to fund HAMP ($50 billion under TARP and $25 billion from Fannie Mae and Freddie Mac). This paper will critique the effectiveness of HAMP and its companion programs, and dissect what went wrong. This will include an analysis of strategic defaults, securitization, and legal liability. Then, I will lay out proposed solutions and advocate what I think would have been the best solution from the start. Lastly, this paper will provide an outlook for the real estate market.

Keywords: HAMP, mortgage modification, foreclosure, real estate, TARP, MHA

Suggested Citation

Gans, Marc, HAMP: Doomed from the Start (April 6, 2012). Cornell Real Estate Review, Forthcoming. Available at SSRN: or

Marc Gans (Contact Author)

University of California, Los Angeles (UCLA) - School of Law ( email )

385 Charles E. Young Dr. East
Room 1242
Los Angeles, CA 90095-1476
United States

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