Tuesday, August 31, 2010

Obama Administration Plans Loans for Mortgage Aid

The Obama administration has been concerned since the day they took office and implemented multiple bail-out programs designed to stem the tide of home foreclosures and provide a much-needed boost to housing sales.

The Obama administration, seemingly at a loss for fresh solutions to jump-start the nation's moribund economy plans to sink millions more dollars into the housing market to help unemployed homeowners keep their homes by providing refinance assistance.

The administration will begin a Federal Housing Administration refinancing effort to help borrowers who are struggling to pay their home mortgages, and will start an emergency homeowners’ loan program for unemployed borrowers so they can stay in their homes, Mr. Donovan said on “State of the Union” on CNN.

Despite the nation's unemployment rate frozen at 9.5% and countless others out of work for longer than 26 weeks, the administration is hell-bent on beginning a Federal Housing Authority refinance program in an effort to keep folks struggling to pay their mortgages in their houses, while starting an emergency loan program for the unemployed.

While it is admirable that the administration would like to keep as many unemployed folks in their homes as possible---selling the notion that it is to help the unemployed----it is far more likely that in doing so, they hope to manage the number of homes currently in default, thus preventing them from piling on to the existing record number of foreclosures.

No matter how many times a loan is modified or re-written for anyone, under any circumstances who remains out of work and unable to generate income, all that is happening is the postponement of the inevitable. It doesn't take an M.B.A. from the Wharton School of Economics to figure out that any stipulated monthly payment will default with the absence of income.

To view full articles visit Examiner.com and The New York Times

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