Gov't to ease foreclosure rules for unemployed

[ProSense]

Source: Associated Press

WASHINGTON (AP) — The Obama administration is making it easier for out-of-work homeowners to stay in their homes, as it tries to revamp its signature but troubled foreclosure-prevention programs.

Starting Aug. 1, the Federal Housing Administration will extend the forbearance period for unemployed homeowners in its programs from three or four months to a full year. That will allow qualified homeowners to miss payments for 12 months before the foreclosure process begins.

The government launched a foreclosure program in 2009 to help those at risk of foreclosure by lowering their monthly payments. Borrowers start with lower payments on a trial basis. But the program has struggled to convert them into permanent loan modifications.



Read more: http://news.yahoo.com/govt-ease-foreclosure-rules-unemployed-161423945.html

[Poll_Blind]

1. This is very good news- and there was also news recently about a program to....

...help those struggling with home payments and who, I believe, had already missed at least one payment. I believe there was a billion dollars which was to be distributed among homeowners, which is a huge lifeline for people/families on the edge.

:thumbsup:

PB

[dkf]

3. To me this is Obama acknowledging there aren't jobs coming on line anytime soon.

He has capitulated.

[AllTooEasy]

7. Hey Dumbass, every economist is saying this! How...

...is acknowledging an obvious, universally accepted truth capitulation?!

2+2=4; DAMN, I just capitulated!!!

[dkf]

2. Free rent for a year.

Actually if foreclosures take 1-2 years it could mean free rent for 3 years. I guess this is the way we create disposable income to stimulate the economy. Looks like they have given up on job creation.

[ProSense]

5. Or

adjusting for more than a decade of predatory activities by banks.

Yes, it will have a stimulative effect.

[dkf]

6. How can you be predatory on an FHA loan?

Aren't rates kind of set?

[ProSense]

8. Wait

aren't Banks involved in FHA loans?

Banks are responsible for the subprime mess and for passing off these bad debts to these agencies. Deregulation, the repeal of Glass-Steagall and passage of the Commodity Modernization Act, also weakened regulators hands.

[dkf]

9. Predatory is defined by terms to the borrower right?

http://www.onlinefhaservices.com/fha_modernized.html

FHA says they are the antidote to predatory lending, not a cause of it.

[locahungaria]

12. In this case, Prosense is correct.........

also, in many areas of the country, the median home price exceeded the FHA loan amount limit (era early 2000's), therefore pushing folks into a "conventional" loan.

[Corey_Baker08]

23. I Agree, A Majority Of Unemployed Or Underemployed Rent Their Homes Are Facing Extremely Hard Times

In the 21 years that I have been on this earth I have lived in rental houses my entire life and my parents who are hardworking blue collar workers who have faced or are currently facing a financial catastrophie as millions and millions of more jobs are being lost leaving these folks, ecspecially the couple who can't just go to the bank and get a loan against their home when times get rough like individuals with mortgages can several times over.

[onehandle]

4. Eric Cantor will be outraged and demand we process the unemployed into Soylent Green. nt

[Tempest]

10. What about the underemployed?

My neighbor was laid off and could only find a job paying less than half of what he used to make. He's losing his home and moving out next week. And he's not the only one I know of in this situation.

[locahungaria]

13. Good question!

I have been in that sticky "underemployed" category myself, and sadly "put" myself in a situation where there was little to no help.

[scheming daemons]

11. Can't be true. Obama hates the poor and middle class... DU told me so.

...

[DesertDiamond]

14. I wish this had come a little sooner. I live in a nice, safe neighborhood full of nice people

and there are foreclosures all over the neighborhood. This should have been done a long, long time ago IMO. Still, better late than never, and I am very very happy for everyone who can still save their homes.

[alp227]

15. Obama administration boosts aid for unemployed homeowners

Source: Los Angeles Times

Reporting from Washington—
Still scrambling to stabilize the struggling housing market, the Obama administration will allow some unemployed homeowners to miss a year of mortgage payments without threat of foreclosure while they try to find a new job.

The expanded assistance — triple the current limit of four months for those with government-insured mortgages — could help "tens of thousands" of people keep their homes, Housing and Urban Development Secretary Shaun Donovan said.

"Helping struggling borrowers avoid default is not only good for those borrowers, it is good for the economy," he said.

But hoping to avoid high expectations that have accompanied other administration foreclosure efforts, Donovan cautioned Thursday that the move wasn't a "silver bullet."

Read more: http://www.latimes.com/business/realestate/la-fi-foreclosure-aid-20110708,0,1640816.story

[bainz]

16. I wish he would come up with something

for us underemployed home-borrowers. I could use a month or two to get back on track.

[MiniMe]

17. For some homeowners

That is only if you have an FHA loan.

[customerserviceguy]

18. This is a band-aid at best

The skipped payments would just go on to the principal balance of the mortgage debt, they are not likely to be forgiven, despite what this article hints at. All it means is that homes that might not be underwater will more likely be that way.

The housing market has to find its' natural bottom before we can possibly recover from this recession/depression.

[No Elephants]

19. The last program failed. Some said it was designed to fail. Here's hoping this program works.

[undeterred]

20. I wish he would come up with something for unemployed renters.

Never ever happens.

[DiverDave]

21. Too late for us, already lost ours

but I wasnt unemployed, the wife is, and that tipped us under.

Ah, well, I can try again...dont know when tho

[Corey_Baker08]

22. What About Unemployed Individuals Who Rent Their Home?

To me this issue hits close to home as my parents have always rented their houses and I grew up most of my life in rental properties it has really started to aggrivate me that everyone seems to forget about relief for struggling families who rent their homes and have monthly payments that even through the worst of times has not seen their rent drop one cent and no policies or procedures have been formed or utilized to bring relief to millions of hardworking people like my parents who prefer to rent their house.

I think its important to recognize that this isn't a subject to lay blame soley on President Obama as individuals who rent their homes have been complety ignored for decades now while a large portion of individuals who have a mortgage have acted irresponsibly taking out multiple loans against their homes without consideration or regard of what they would do once the bank raietses their monthly payment so high that they can't make their mortgage payment or if an unforseen event would occur such as the loss of a job or an unexpected illness takes place.

Yet there have been countless programs to assist homeowners do things like renegotiate their mortgages or enact a moritorum on foreclosures around the country. Yet, while they're the ones who acted irresponibly, it is precisely them that do get relief with thier mortgage payments while renters are completely forgotten and falling further and further behind on their rent and getting evicted at an astonishing rate, why hasn't anyone proposed or enacted any rent relief legislation?

BTW I want to emphasize that a majority of homeowners with mortgages have acted responsibly and not let the temptation of greed entice them to take out high risk irresponsible loans out against their homes, there are a lot of individuals who have though and my point is essentially why reward or relieve those who acted irresonsibly in taking out unaffordable loans against their homes with all these mortgage relief plans while individuals who rent their homes have actually seen their rent increase significantly yet cannot get any relief when they fall behind and face eviction