Yes, and we second that motion! Question, when is really going to start to work?
Obama has a new Plan to help homeowners facing Foreclosure.
It's Called Name and Shame.
The Plan: Publicly out loan servicers and banks who are failing to modify the mortgages of homeowners. The thought is that the public shame will embarrass the companies to act responsibly and change behavior.
The Why: The Administration and Treasury department have gone on record saying that too few loans have been modified since the bail out money was made available. Last Spring, $75 Billion of Taxpayer funds were made available to banks and loan servicers as an incentive to modify mortgages instead of foreclosure. Officials argue that banks aren't doing enough to help the millions of Americans at risk of losing their homes. Some banks and loan servicers have not modified a single loan.
Will it work: Probably Not. The short term media coverage will draw attention to the plight of millions of Americans and has the potential to alter public opinion. The reality is that the banks and loan servicers profit from foreclosures. Without a financial penalty that harms stockholders, there is not enough incentive to change the irresponsible social behavior of the corporations.
What will work: Heavy hitting fines by the government are one option. A more powerful option would be a public boycott of any bank on the list. If Americans would stop using the credit cards of any bank listed for a 30 to 60 day period, corporatebehavior would change dramatically.
I am Kate Bourland. I help my clients get out of debt and establish a debt free lifestyle. You can reach me at 530-419-3967.