On February 18, 2009, President Obama announced his Homeowner Affordability and Stability Plan, designed to help up to 7-9 million families avoid foreclosure by restructuring or refinancing their mortgages. In doing so, the plan not only helps responsible homeowners behind on their payments or at risk of defaulting, but prevents neighborhoods and communities from being pulled over the edge too, as defaults and foreclosures contribute to falling home values, failing local businesses, and lost jobs.
The key components of the plan are:
1. Government Sponsored Enterprises (GSEs) Refinancing for Up to 4 to 5 Million Responsible Homeowners with GSE loans to Make Their Mortgages More Affordable - That's money going to Fanniw Mae and Freddie Mac
2. A $75 Billion Homeowner Stability Initiative to Reach Up to 3 to 4 Million At-Risk Homeowners
3. Supporting Low Mortgage Rates By Strengthening Confidence in Fannie Mae and Freddie Mac
Below are links to articles that appeared in the New York Times, based upon NAR Press releases and to the U.S. Treasury site that explains this plan. Basically the plan is trying to shore up the Fannie Mae and Freddie Mac government owned mortgage buyers, as well as providing some direct relief to homeowners who are already over the edge or who may be approaching the edge.
If the plan works as hoped, it will allow som eof the millions of homeowners who have mortgages that have reset to untenable levels or which are about to reset to levels which the homeowner can’t afford, to refinance the loans into longer term, lower cost mortgages. The idea is to stem the tide of new foreclosures. Let’s all hope that it works. Some of these reports may also serve as great insomnia medicine.
Here’s a link to the NAR short, visual version, for those who prefer not to have to read very much.
For more on this story:
Download NAR's Summary on the Homeowner Affordability and Stability Plan> (PDF: 100K)
Visit the U.S. Treasury Department links below for more detailed information:
Executive Summary> (PDF: 47K)
Fact Sheet> (PDF: 65K)
Questions and Answers for Borrowers> (PDF: 55K)
3 Housing Examples> (PDF: 37K)
Let's all hope that this pile of money that the government is spending (and it is your money after all) to try to stabilize the Husein market works. We've likely all seen the rant by the CNBC reporter from the floor of the New York Stock Exchange, railing against bailing out homeowners who made bad decisions. That populist view is easy to agree with; but, it misses the point that we all suffer already for the mistakes that those people made, because their foreclosures drag down our property values, too. It's not throwing good money after bad; it's more throwing good money and hoping it's enough to make a difference.
The key components of the plan are:
1. Government Sponsored Enterprises (GSEs) Refinancing for Up to 4 to 5 Million Responsible Homeowners with GSE loans to Make Their Mortgages More Affordable - That's money going to Fanniw Mae and Freddie Mac
2. A $75 Billion Homeowner Stability Initiative to Reach Up to 3 to 4 Million At-Risk Homeowners
3. Supporting Low Mortgage Rates By Strengthening Confidence in Fannie Mae and Freddie Mac
Below are links to articles that appeared in the New York Times, based upon NAR Press releases and to the U.S. Treasury site that explains this plan. Basically the plan is trying to shore up the Fannie Mae and Freddie Mac government owned mortgage buyers, as well as providing some direct relief to homeowners who are already over the edge or who may be approaching the edge.
If the plan works as hoped, it will allow som eof the millions of homeowners who have mortgages that have reset to untenable levels or which are about to reset to levels which the homeowner can’t afford, to refinance the loans into longer term, lower cost mortgages. The idea is to stem the tide of new foreclosures. Let’s all hope that it works. Some of these reports may also serve as great insomnia medicine.
Here’s a link to the NAR short, visual version, for those who prefer not to have to read very much.
For more on this story:
Download NAR's Summary on the Homeowner Affordability and Stability Plan> (PDF: 100K)
Visit the U.S. Treasury Department links below for more detailed information:
Executive Summary> (PDF: 47K)
Fact Sheet> (PDF: 65K)
Questions and Answers for Borrowers> (PDF: 55K)
3 Housing Examples> (PDF: 37K)
Let's all hope that this pile of money that the government is spending (and it is your money after all) to try to stabilize the Husein market works. We've likely all seen the rant by the CNBC reporter from the floor of the New York Stock Exchange, railing against bailing out homeowners who made bad decisions. That populist view is easy to agree with; but, it misses the point that we all suffer already for the mistakes that those people made, because their foreclosures drag down our property values, too. It's not throwing good money after bad; it's more throwing good money and hoping it's enough to make a difference.
Some of the clowns who got in way over their heads on homes that they can't even afford to pay the taxes on should be allowed to fail - and they will eventually. Others, who got in trouble through no real fault of their own, deserve to be helped and they will be helped by this action. The real sticking point is trying to find a way to arbitrate those two scenarios, which likely is impossible. So, bring on the bucks and let's see if we can solve this problem by papering it over.
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