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Obama takes foreclosure prevention programs to the people



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By : E. Nathaniel    99 or more times read
In an effort to help support struggling homeowners and struggling public approval numbers, President Obama has been hitting the trail hard to deliver foreclosure relief programs and housing market support on a more localized basis.

While some of the more broad-based programs are nearing expiration, including the all-important home buyer tax credit programs (April expiration), many states are still struggling mightily with high foreclosure and delinquency rates. This is in spite of recent data that suggests that overall, foreclosures and delinquent payments are on the decline.

In a change of strategy, the Obama Administration has decided to offer more direct support to homeowners in state’s hardest hit with unemployment and challenged borrowers. This is a response to strong criticism that the president’s program to combat foreclosures has been ineffective because it focuses solely on interest rates, without helping already buried in debt mortgagees.

The Fed, along with intervention programs, has helped support the housing market with low cost borrowing. However, this has done little to help record numbers of unemployed people deal with the reality of being buried in late payments and already high principle and interest payments.

Obama recently visited Nevada to present an overview of a new initiative specifically designed to assist struggling homeowners in five key states hit the hardest by unemployment and mortgage troubles.

The new foreclosure program involves a $1.5 billion outlay of finances to help combat foreclosures in Arizona, California, Florida, Michigan and Nevada. The plan calls for an infusion of money to housing agencies in the states to help assist cash-strapped and overwhelmed borrowers through more direct loan payment assistance to help them through the tough times.

There was not a lot of clarity provided in terms of exactly how the funds would be used. However, the basic intention appears to be to more successfully help prevent a loss of homes to foreclosures by assisting borrowers with payments as they deal with unemployment and high loan payment obligations. The states and housing agencies would appear to have some discretion over the use of the funds and program management.

Many analysts are already calling for a broader program that delivers a similarly direct approach to stopping foreclosure. Despite the improvements in housing and foreclosure data during January, some economists still believe the housing market remains in a downward spiral with recent data influenced by intervention programs and not grounded on solid fundamentals.

The Obama Administration appears to be looking for virtually any reasonable option when it comes to combating the tide of foreclosures that have swept across the country in the last year and a half. Other proposals being considered include a possible foreclosure ban. This would prevent banks from entering into the foreclosure process with a delinquent borrower prior to a review of the situation for an alternative, such as a loan modification agreement.
Posted by ForeclosuresToGo.com

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