Posts Tagged ‘Obama’s Help for Homeowners’

Government OKs $600 Million in Housing Aid for 5 States

good news headline
The Obama administration plans to send $600 million to help unemployed homeowners avoid foreclosure in five states.

The Treasury Department said Wednesday that mortgage-assistance proposals submitted by North Carolina, Ohio, Oregon, Rhode Island, and South Carolina received approval. The states estimate their efforts could help up to 50,000 homeowners.

The administration is directing $2.1 billion from its existing $75 billion mortgage assistance program to a total of 10 states. Each state designed its own plan. Treasury approved money in June for Arizona, California, Florida, Michigan, and Nevada.

“These states have designed targeted programs with the potential to make a real difference in the lives of homeowners struggling to make their mortgage payments because of unemployment,” Herbert Allison, an assistant treasury secretary, said in a statement.

More aid to the unemployed is coming. The sweeping financial reform bill passed signed into law by President Barack Obama last month provides an additional $3 billion to help jobless homeowners pay their mortgages.

Of that money, $2 billion is coming from Treasury’s foreclosure-prevention effort. The rest is to be managed by the Department of Housing and Urban Development.

Source: Alan Zibel (

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Gov’t to Speed Up Mortgage Relief – What’s the bigger issue?

speed up mortgage relief

In horse racing, it’s called showing the horse the stick, and the U.S. Department of Treasury gave the nation’s largest mortgage companies a long look at it Monday [Nov. 30, 2009].

Now, it will have to see how they respond.

Concerned that mortgage firms were moving too slowly to get struggling homeowners into affordable permanent loans, the Obama administration announced a series of immediate steps, sending so-called SWAT teams into lenders’ offices; promising twice-daily progress reports and threatening financial sanctions and public shame if results don’t improve.

Assistant Treasury Secretary Michael Barr said the banks simply have “not done a good enough job” in moving people to permanent loans.

What has happened so far

Overall, the administration considers its Making Home Affordable program — announced last February — a success, at least so far. With financial incentives for companies that service loans and collect payments, as well as for the lenders themselves, the intent remains to modify 3 million to 4 million home loans by 2012 for people paying more than 31% of their income for their monthly mortgage.

But nine months in, only 651,000 loans — about 1 of 5 eligible loans nationwide — is under a trial modification, envisioned as a 3-month-long period during which the mortgage companies collect documentation from the borrower and make sure he or she can afford the new amount. If not, the loan can revert to earlier terms, making foreclosure more likely.

The bigger issue

John Courson, president and chief executive of the Mortgage Bankers Association, said lenders and servicers are not dragging their feet because the incentive is already there for them not to. The payments they stand to get under the program are withheld until modifications are permanent.

It has become clear, he said, that some people can’t document the income they say they have to qualify for the program; in other places — particularly in hard-hit areas like Michigan, where joblessness is high — people have trouble paying even the lesser amount.

“If you don’t have a job and you don’t have adequate income,” Courson said, “you can’t make the payment.”

Full article: Todd Spangler (Free Press Washington Staff)

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Home Buyer Tax Credit extension – What is the decision?

President Obama’s housing secretary tells a Senate committee that the administration wants to see cost data before backing any extension of the credit.


While momentum is building on Capitol Hill to extend the $8,000 first-time homebuyer credit, President Obama’s housing secretary said the administration has not decided whether to support its expansion.

Housing Secretary Shaun Donovan told the Senate Banking Committee that the administration wanted more time to better assess the cost of the credit, which expires on Nov. 30.

“Within a few weeks we’ll have sufficient data to get to a conclusion on this,” Donovan said. “It’s a question of understanding more fully the costs to the taxpayer.”

He said there is “clear evidence” the credit has had some positive benefits and that its expiration could have “some negative implications” for the housing market.

At the same time, Donovan said that the end of the credit would not be “catastrophic” because of other actions the government is taking to support the flagging housing market. Interest rates are being kept low and the Federal Housing Administration is playing a more prominent role in lending to homebuyers.

But lawmakers pushing to extend the credit are concerned the housing market is going “to die a sudden death” after Nov. 30, as Sen. Johnny Isakson, R-Ga., said Tuesday.

Isakson and other supporters believe that keeping the credit in place could further boost home sales, stabilize housing prices and generate jobs.

Isakson and Senate Banking Chairman Christopher Dodd, D-Conn., have co-sponsored an amendment that would extend the credit until the end of June 2010 and be available to single filers making up to $150,000 and joint filers making up to $300,000. Currently the credit is limited to homebuyers who haven’t owned a home for the past three years, who make half those amounts and who close on their purchases by Nov. 30.

Whether or not the credit is extended, forecasters are expecting further price declines in many markets due to rising foreclosure and unemployment rates in 2010. Supporters of extending the credit believe it could help mute those price declines.

Opponents say extending and expanding the credit would be a waste of money and only temporarily stave off further price declines.

When asked whether he thought the credit was spurring confidence or artificially inflating prices, Donovan told lawmakers he believes: “Given the decline we’ve been through, the likelihood that the credit is inflating the market beyond where it would be is very low.”


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Washington Report: Home Affordable Refinance Program

The Obama administration’s latest expansion of its “home affordable” refinance program, outlined just before the July 4 holiday, could be huge news for tens of thousands of owners whose houses are seriously “underwater,” or where they’re worth a lot less than the mortgage balance owed on them.

Under the new rules, even where borrowers have negative equities of as much as 25 percent, they may be able to refinance into better loan terms, provided their mortgage is owned or guaranteed by Fannie Mae or Freddie Mac.

Under the original rules for the program, the cutoff point was just five percent negative equity — or a “loan to value” (LTV) ratio of 105 percent.

Though an estimated 80,000 owners already have been refinanced by Fannie and Freddie, HUD Secretary Shaun Donovan and Treasury Secretary Tim Geithner decided that the 105% LTV limit left too many borrowers out of reach.

In some parts of California, Nevada, Arizona and Florida, 40 to 50 percent of home owners are now stuck with negative equities, according to industry estimates. In Las Vegas, 67 percent of owners are underwater.

Read more…

To take advantage, contact your loan servicer to see if your mortgage is owned by Freddie or Fannie. Or you can check online at either, or

Original article written by Kenneth R. Harney

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Obama’s Help for Homeowners

Help for Homeowners – Obama’s Homeowner Affordability and Stability Plan will help bring relief to homeowners and bring some order to the housing market, according to The White House Blog Post (02/18/09). Click the link below for more information and FAQs.