Obama expands housing help to include second mortgages

[babylonsister]

Obama expands housing help to include second mortgages

By Kevin G. Hall | McClatchy Newspapers



WASHINGTON — The Obama administration expanded its efforts to prevent Americans from losing their homes, unveiling a program Tuesday that's designed to give financial incentives for companies to modify the terms of troubled second mortgages.

The new effort builds on the Making Home Affordable program, which was announced on Feb. 18 to arrest the rising rate of foreclosures by lowering homeowners' monthly payments. The administration now will give cash rewards to mortgage servicers, who act as bill collectors for investors who own pools of mortgages.

As many as 6 million homeowners nationwide are thought to be at risk of foreclosure over the next several years, potentially prolonging the worst housing slump in modern times and delaying an economic recovery. The administration hopes to help 4 million of these homeowners avoid foreclosure.

"Ensuring that responsible homeowners can afford to stay in their homes is critical to stabilizing the housing market, which is in turn critical to stabilizing our financial system," Treasury Secretary Timothy Geithner said in a statement.

more...

http://www.mcclatchydc.com/251/story/67072.html

[w4rma]

1. As long as housing prices are allowed to drop to where they should be, this is fine.

No more Wall Street manufactured bubbles!

[lumberjack_jeff]

2. I just signed papers on a "relief refinance" through freddie mac

My new interest rate is 4.75% (yay!) and the closing costs (exclusive of accrued interest) were way less than $1000.

Saves me about $150 a month. :)

For some homeowners, the interest rate change can make the difference between homeownership (even if perhaps upside down homeownership) and foreclosure.

[KathieG]

4. How long did the process take?

We submitted the required paperwork to our mortgage company almost 6 weeks ago, and our request is still being "processed".

[lumberjack_jeff]

5. 'bout that.

4-6 weeks, I think.

It's a streamlined process, but the banker tells me that he's flooded with applications.

[HopeOverFear]

3. kick