Short Sale, Foreclosure and Strategic Default

Loading...

Friday, November 7, 2008

Loan Modification - Hope for Homeowners

Expectations lowered for new mortgage aid program - Los Angeles Times
WASHINGTON -- The government expects only 20,000 troubled borrowers will apply to refinance into more affordable home loans by next fall under a new mortgage aid program passed by lawmakers over the summer.

The $300 billion "'Hope for Homeowners" program was launched Oct. 1. Designed by lawmakers eager to respond to the mortgage crisis, the Congressional Budget Office had projected it would let 400,000 troubled homeowners swap risky loans for conventional 30-year fixed rate loans with lower rates.

Ads by Google

Fed Cuts Rates Again

180,000 Refinance under $999/mo. Lowest Mortgage Rates Since 1958!

www.CalculateNewPayment.com

Is your Mortgage Late?

Eliminate all late Payments & Fees Get Fresh Start, we Lower your Rate

www.ForeclosureForward.org

FHA Mortgage Loans

Make your mortgage affordable for a lifetime! Lock in today.

GMACMortgage.com/FHA
But the early results are discouraging: the government received only 42 applications in the program's first two weeks, according to the Federal Housing Administration. The low turnout was first reported by the industry newsletter Housing Wire. Since the applications take about 60 days to process, no loans have been approved yet.

Steve O'Halloran, spokesman for the Department of Housing and Urban Development, called the projection of nearly 20,000 borrowers "an extremely preliminary estimate of early applications for a program that is barely a month old. Borrowers and lenders are continuing to sign up."

Since the program requires lenders to voluntarily reduce the value of a loan and take a loss, it's unclear how many lenders will participate. In addition, the program may be unattractive to some borrowers because those who sell their properties must agree to share some of their profits with the government.

No comments: