Madmen to Market Mortgage Modifications

With the number of final mortgage modifications below target and criticism mounting that it’s not making a significant difference in the war to stem foreclosures, the Administration’s Home Affordable Modification Program (*HAMP) is asking the advertising wizards of Madison Avenue for help.

The U.S. Treasury and the Department of Housing and Urban Development Wednesday announced the launch of a nationwide public advertising campaign to increase awareness about the government’s Making Home Affordable Program.

“We want to do all we can to help make sure that struggling homeowners know about these free resources for help,” U.S. Treasury Secretary Timothy Geithner said in a statement accompanying the announcement.

The HAMP ad campaign was first announced in February by Phyllis R. Caldwell, Chief of the Treasury Homeownership Preservation Office. The campaign is the product of the Ad Council, a not-for-profit coalition of advertising agencies better known for its efforts to promote health, public safety and communities. The Council’s member agencies volunteer their creative time and efforts on behalf of public service clients.

HAMP’s agency is the Kaplan Thaler Group, best known for creating the Aflac duck, Herbal Essences Totally Organic Experience, Continental Airlines “Work Hard. Fly Right,” and Swiffer Sweeper campaigns. Its clients include U.S. Bank, one of the larger lenders participating in the HAMP program.

The campaign will feature PSAs on television, radio, outdoor signage, and the Internet, as well as flyers and other print promotional materials. The PSAs will feature real homeowners who have benefitted from the program, and they encourage homeowners that are struggling with their mortgage payments to visit www.MakingHomeAffordable.gov or call 1-888-995-HOPE (4673) to learn about their options, according to the Ad Council Web site.

The Ad Council will distribute the new PSAs to more than 33,000 media outlets nationwide, who will provide advertising space to the government program for free. The campaign includes television, radio, print, out of home and web advertising.

Fewer than 400,000 ongoing permanent modifications are now in place, some 17 months after the program was launched. In his most recent quarterly report to Congress Neil Barofsky, the Special Treasury Department Inspector General to oversee the Troubled Assets Relief Program, said the Home Affordable Modification Program “continues to struggle to achieve its stated original objective.”

However, the first homeowners to complete the modification process successfully, are re-defaulting at much lower levels than predicted. See Success of HAMP Loan Modifications Stuns Experts.