WASHINGTON – December 6, 2007 – Comptroller of the Currency John C. Dugan issued the following statement today at the Department of the Treasury press conference announcing a plan to assist a key segment of subprime borrowers to modify their mortgages and avoid foreclosures:
- The plan announced this afternoon provides a programmatic approach to facilitate modifications of large numbers of mortgages for a key segment of subprime borrowers – without taxpayer assistance. It will allow more borrowers to remain in their homes, and more mortgage holders to avoid the very substantial costs of foreclosure. The OCC strongly supports the new programmatic approach, which, in addition to benefiting borrowers and investors, also constitutes a safe and sound practice for national banks that act as mortgage servicers.
- I commend the efforts of Secretary Paulson, Secretary Jackson, and representatives of the mortgage lender, servicer, and investor community that comprise the HOPE NOW Alliance. Their hard work has brought about agreement at a critical time for many homeowners, lenders, and mortgage servicers.
- Of course, the new programmatic approach will not apply to the segment of subprime borrowers who can refinance at market rates or into FHA loans. And it will not apply to the segments of borrowers who have fallen behind on their existing payments or have started the foreclosure process, but – and this is important – these borrowers will still be eligible for loan modifications on a case-by-case basis depending on their circumstances.
- I believe the new programmatic approach is a model “best practice” for the industry to address a number of competing interests fairly and sensibly. Most important, it constitutes another creative way to allow current borrowers to stay in their homes.
# # #
The Office of the Comptroller of the Currency was created by Congress to charter national banks, to oversee a nationwide system of banking institutions, and to assure that national banks are safe and sound, competitive and profitable, and capable of serving the banking needs of their customers in the best possible manner. OCC press releases and other information are available at http://www.occ.gov. To receive OCC press releases and issuances by email, subscribe at http://www.occ.gov/listserv.htm