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The Homeowner Affordability and Stability Plan (HASP) was a $75 billion federal housing rescue program announced by President Barack Obama in February 2009 to address the subprime mortgage crisis. It operated as the umbrella framework for two major initiatives: the Home Affordable Modification Program (HAMP) for struggling homeowners, and the Home Affordable Refinance Program (HARP) for homeowners who were current on their payments but owed more than their homes were worth due to falling property values.
HASP was implemented through the US Treasury Department in coordination with Fannie Mae, Freddie Mac, and the Federal Housing Finance Agency. It provided the legal and financial architecture that made large-scale mortgage modifications and refinances operationally possible.
HASP addressed two distinct categories of distressed homeowners, each requiring a different solution.
By February 2009, US home prices had fallen over 20% from their 2006 peak. Foreclosure filings were on pace to exceed 3 million for the year. Mortgage-backed securities had lost enormous value, and the interconnected losses were cascading through the financial system.
The standard foreclosure process damaged all parties. Servicers faced enormous processing backlogs. Investors holding the loans frequently recovered less through foreclosure than through modification. Communities suffered from vacant properties that depressed surrounding home values further. HASP was designed to interrupt this cycle at scale.
The $75 billion allocated to HASP flowed through a pay-for-performance structure rather than grants. Servicers received payments only when modifications were completed and only as long as modified loans remained current. Investors received incentive payments for approving modifications. Homeowners received on-time payment credits for staying current on their modified loans.
This structure ensured federal money was spent on outcomes rather than process. It also aligned the financial interests of all parties toward modification completion and long-term loan performance.
Together, the Making Home Affordable programs under HASP helped nearly 5 million Americans avoid foreclosure through modifications, refinances, and short sales. HAMP alone resulted in a median monthly payment reduction of $530 for participating homeowners.
HASP fell short of its initial target of helping 7 to 9 million households. A significant shortfall in servicer participation early in the program, combined with documentation requirements that many struggling homeowners struggled to meet, limited the reach. The National Consumer Law Center documented that servicer noncompliance was the primary barrier to scale.
Both HAMP and HARP expired at the end of 2016. The Federal Housing Finance Agency replaced HARP with the Flex Modification program in 2019, which gave Fannie Mae and Freddie Mac servicers a standardized modification option for qualifying borrowers. Separate hardship assistance programs through individual servicers continue to offer relief options modeled on HASP principles.
HASP's lasting contribution was proving that standardized, large-scale mortgage modification was operationally feasible and economically rational. Every subsequent government housing relief program builds on the documentation, eligibility, and waterfall structures HASP established.
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