A Guide to Help the Obama Administration Stop Foreclosures

By: Joseph Smith

In 2008, the total number of foreclosed homes in the United States reached 2 million. These 2 million distressed properties are additional burden to the housing market which saw its total annual sales reaching only 5 million.

U.S. Treasury Secretary Timothy Geithner is scheduled to release his financial rescue program which will include provisions to address the foreclosure crisis.

Following are some suggestions to help the Obama Administration in its campaign to eradicate the foreclosure problem.

• Support housing aid programs that are proven to be effective. Federal support provided for government-sponsored enterprises such as Federal Home Loan Mortgage Corp. and Federal National Mortgage Association and mortgage insurance programs have resulted to low mortgage interest rates. Meanwhile, the Department of Housing and Urban Development (HUD) insured over 500,000 loan refinancings in 2008. This indicated that many borrowers have shifted from subprime loans to government-insured, 30-year fixed-rate loans.
• Invest in the modernization of the Federal Housing Administration (FHA) to ensure that it is fully equipped in handling its over $500 billion portfolio.
• Do not provide incentives to lenders to motivate them to modify loans. The fact that lenders will stand to lose up to half of a property’s mortgage value under foreclosure is enough motivation for them to modify a distressed homeowner’s loan.
• Create aid programs in consultation with financial institutions tasked to implement them.
• Keep in mind that mortgage debt is just one facet of the current economic crisis. Some borrowers may find it hard to overcome this problem if they are also facing another bigger problem such as unemployment.
• Lastly, develop a full-proof screening process for any assistance program to ensure that those who will benefit are really entitled for the help and are responsible homeowners. The end to foreclosure requires successful assistance programs and understanding of various challenges facing distressed homeowners.

Niche Article Directory: http://www.thatsmyniche.com

Cassiano Travareli has been educating buyers on the finer points of Foreclosure Properties purchase at FindForeclosureProperties.com for over four years. Click here to visit and read more Foreclosure Properties Information.

Please Rate this Article

5 out of 54 out of 53 out of 52 out of 51 out of 5 

Not yet Rated