Rescue Plan for Housing – Subsidized Lower Monthly Payments
With foreclosure filings in the U.S. at a record high of 2.4 million in 2008, an 81 percent increase from 2007, many homeowners and industry leaders alike, are eagerly anticipating a rescue plan. The ailing housing market is a major contributor to our economic troubles; which has, evidently, finally caused lawmakers to take notice.
Rumor has it that as of Tarp II the Obama administration is in the process of developing a standardized approach to modify mortgages for those who are in danger of losing their home. A vow of at least $50 billion, by President Obama’s top economic advisers, is expected to be included in the unveiling of a new rescue plan, in the coming weeks.
One possibility that administration officials are discussing, is the possibility of subsidizing lower monthly payments for troubled borrowers. This would take effect after a standardized reappraisal of troubled homeowners’ value and affordability of their homes.
The goal is to reduce mortgage payments to 31 percent of the household gross monthly income. This can be accomplished in a number of ways: (i) through the reduction of interest rates, (ii) through the increase of the loan’s repayment period, (iii) through the reduction of the outstanding principle.
Another possibility is the expansion of the Hope for Homeowners Act, which is designed to aid delinquent borrowers through subsidizing mortgage rates by raising the amount of government purchases of mortgage-backed securities.
Regardless of the approach used to help the housing sector to recover, the need to prevent continued housing value declines and rising foreclosures is in desperate need.
Here are some additional resources:
Housing Plan Will Accelerate Loan Modifications, HUD Says – Los Angeles Times
Administration Is Developing a Housing Rescue Plan – New York Times
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Homeowner Bailouts = Renters Getting Robbed! Homeowners think I should keep the fraudulent value of their homes propped up just because they were part of the greatest criminal conspiracy this country has ever seen. I didn’t realize renters were treated as second class citizens in this country. You steal my money to give to people that work at Taco Bell, so they can keep living in a $300K house. Corrupt homeowners think that just because they WISH their house is worth so much – that makes it true. I hope the day comes when stupid publically school taught renters finally realize they are getting raped on a daily basis by these Yuppie Scumbag Trash & rise up & fight to take back this country from the criminals that run it!
Jeff,
It’s not just your country, it’s in the UK and Im sure loads of other countries in europe as well.
The citizens in the UK have been shafted in every way shape & form by all the big institutions over the years.
Compared to some of the strokes being (and have been) pulled over here you get off lightly in the U.S.