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Treasury threatens servicers over slow mortgage modifications
WASHINGTON — The Treasury Department announced Monday that it would send financial "SWAT" teams to leading mortgage servicers in December to police their performance in a $75 billion government program that seeks modifications of distressed mortgages in order to reduce the high national rate of foreclosures.

It's an effort to ratchet up pressure on mortgage servicers, who act as bill collectors on behalf of banks that originate mortgages or investors who own bundles of mortgages pooled together as securities....

...The Obama administration will send "SWAT" teams to keep an eye on the six largest mortgage servicers, who collectively handle about 85 percent of outstanding U.S. mortgages. Participating servicers also will be required to report to the Treasury twice daily on their progress to convert trial modifications to permanent fixes. The failure to boost permanent solutions significantly will trigger consequences, Barr said.

Pressed to detail those consequences, Barr refused, instead repeating that the Treasury wants servicers to step up their efforts and borrowers to do a better job of providing documents to servicers....