I don’t think criticizing the program for “failing to help more people keep their homes” precisely captures the flaws that existed in the program when it was signed into legislation to begin with.
Stated with Mark Levin-esque simplicity, the problem is that the Making Home Affordable program was an effort to solve a problem that did not exist.
The people that actually fit into this program are such a narrow band of people, it really doesn’t do anything significant. The program excludes people who should’ve been denied their mortgage to begin with, and it excludes people that have had such a large loss of income that they aren’t even close to making their payment.
It does nothing for people who are in need of selling their home but can only do so at less than they owe because of the drop in home values. In those cases, short sale already existed, but even so it is an action with negative credit action. If we accept the premise that making home affordable was something where government money should be spent, then perhaps government subsidy of lost value to reimburse short sale with a requirement that no negative credit reporting take place would be worth it so that people who have to move to get jobs can then get housing in spite of the property losses they suffered through no fault of their own. But that didn’t happen.
All the program does is allow refinancing by people who only barely don’t qualify otherwise. You can actually do this with a car loan, but with a home loan there is red tape which requires that fees be paid. So for what little qualifying help this can offer, in reality it just turns out to be a pay-out to bureaucracy.
Yeah, it started out as a flawed premise.