Project Lifeline, what does it all mean?? The Bush administration just announced Project Lifeline on Tuesday the 12th, 2008. This new plan is suppose to be an extension of the previous plans to help homeowners who are having difficulty in keeping up with their payments. The previous plans had strict guidelines to where you basically couldn't be late on your mortgage prior to the rate adjustment on your adjustable rate loan.
President Floyd Robinson of Insurance Services Group said, "We want homeowners facing foreclosure to take the urgently required first step and reach out to their servicer, or housing counselor, and get started on a recovery plan. Project Lifeline represents a broad, national approach to looking at each homeowner's situation individually - making sure that we stop the clock on foreclosure long enough to complete the loan modification process in those cases where it's possible to do so."
So, what will Project Lifeline actually do for you? In conjunction with 6 major lenders and about 27 servicing companies, these lenders will tack on an extra 30 days onto the grace period delinquent borrowers have to get up to date on their mortgages before foreclosure proceedings are started. But they are also adding the 30 days while the bank evaluates whether they're eligible to modify their loan on better terms.
Are you confused now? Feeling upside down? How about both....? I am and I will explain why. I have been in the mortgage industry for 15 1/2 years now and just when I thought I have seen it all. Again, I know we are in an election year. I know that we all want to help these borrowers. But if the homeowner couldn't make their payments for 3 to 4 months, how do you think that they will be able to come up with these payments in one more month. There is more to it, but I don't want to bore you with nonsense details. To me, its common sense.
My Opinion? -- Why don't I just get out my box of band-aids so we can prolong the death of these foreclosures. This should be called the "band-aid plan". Some banks Most banks in the past wouldn't take partial payments for the mortgagee once they were 2 months or more down. They would want it all. I met with an investment group today in NYC who has a goal to help many homeowners and ask myself and my company for help. Sure, we are both in it to make a profit. But this person and her partner are also wanting to help those homeowners that are in trouble. But this will be done with the help of private money and private investors. I'll be explaining our game plan in a later blog, but this is what we need. Lenders willing to help out now, by cutting their losses now, which would possibly help more homeowners save their houses now, instead of these helpless or hapless government plans that actually won't help many at all.
PS> this was not to sound negative by any means. But let's stop with the so-called fluff in regards to the past plans, such as the FHA Secure & the rate freeze plans. We need to forge together as ONE and really make something happen. Not this so-called chit chat. As I mentioned, I will be blogging about something that I am working on with an investment group.
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Copyright © 2008 by Jeff Belonger
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I have to be the devil's advocate and ask why the homeowners are in trouble to begin with.
In some parts of the country, the economy is too blame, loss of jobs and big business, etc. But here in our area, the foreclosure rate is up a little, but not as much as the rest of the country. Perhaps reviewing these homeowners in crisis on an individual basis would help, but it is too timeconuming.
I agree with you that there needs to be one solid plan, in my opinion one with strong guidelines on who qualifies for help and who doesn't. In our area, the section of the county with the highest rate of foreclosure is unfortunately the area that has the lowest per-capita income. What does that say about the initial qualifying guidelines? Many of the foreclosed homeowners in our area never should have a gotten a home to begin with. Sometimes it is ok to "just rent."