It was the hopes of Congress, Realtors, Mortgage Lenders and recent home borrowers that the program instituted by HUD on October 1 would rescue many of the 400,000 homeowners who are in trouble with their home loan lenders.
Interestingly, though, almost two months later, very few have taken advantage of the plan. I suspect that's because it is a voluntary program on the lenders' side.
So earlier this week, the Bush administration signed into law a modification of the program with the hopes it would bring thousands under its umbrella.
The modifications will:
- allow lenders to reduce the mortgage principal to 96.5 percent of a home's current market value instead of the current 90 percent writedown;
- require HUD to make up-front payments to get second lien holders to relinquish their rights to future payments;
- allow lenders to extend 30-year loans to 40-year loans; and
- eliminate the requirement for borrowers to undergo a three-payment trial term before being permanently qualified for a mortgage modification.
BILL CHERRY, REALTORS
Our 44th Year Selling America!