The Obama Administration on Tuesday unveiled a new plan to help homeowners who are underwater on their mortgages, according to a story in the Wall Street Journal.
The program targets between 500,000 to 1.5 million negative equity mortgages, where the homeowner owes more than his or her home is worth.
The first initiative of the program is for homeowners who are current on their mortgages but at risk of default because of sinking home values, the Journal said.
Under the program, banks and lenders will write off the home's value to less than the value of the property and then hand off the reduced loan to the government. The program essentially refinances underwater homeowners into loans backed by the Federal Housing Administration.
About 11 million mortgages or 23 percent of U.S. households with a mortgage are in a negative equity position, according to CoreLogic.
MORE REASON FOR THE BANKS NOT TO ACCOUNTABLE FOR THERE ACTIONS.
Our Government is fueling the ongoing desensitizing of the banking industry.
Just yesterday I had a short sale get approved at $810,000. Of course at the very last minute they sprang a note requierment at the Seller in the amount of $200k. What? Seller did not go for it and then the property was sold at trustee sale for $738k What? Amount owed was over $900K. It just does not matter to them. Stock holder accountability who cares! Let the Government take care of it. Who Pays, we all do.
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