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Mortgage Giants Propose a Rescue Plan
November 12th, 2008
Mortgage giants propose a rescue plan. Fannie Mae and Freddie Mac, the mortgage-finance giants now controlled by the U.S. government, said Tuesday that they planned a broad new effort to reduce the loan burdens of homeowners facing foreclosure. The program will be offered to people who are at least 90 days behind on their payments and already have paid for the bulk of their mortgage, according to government officials. The plan is to change the mortgage by reducing the interest rate so that the monthly loan payment is no higher than 38 percent of the borrower’s monthly income. The government plan could help as many as 300,000 families that are delinquent in their mortgage payments at taxpayer expense, reports The Washington Post. But people with knowledge of the details said Tuesday that it was more limited than a program advocated by Sheila Bair, chairman of the U.S. Federal Deposit Insurance Corp. The plan may apply only to so-called conforming mortgages that Fannie Mae and Freddie Mac have guaranteed. While there are trillions of dollars worth of those loans, they are far less than, and generally separate from, the bulk of subprime loans that are at the heart of the nation’s foreclosure crisis. The foreclosure rate on loans owned by Fannie Mae is about 1.72 percent. By contrast, the foreclosure rate on adjustable-rate subprime loans is nearly 20 percent, according to the Mortgage Bankers Association.
They should be able to pay 39% and survive….people in low income pay 30%. Lets hope this make them happy and next time the will read before signing and not buy house just to say ” I have a house”. My God be with them.
Tracey,
You can’t blame the individuals only the banks had a responsibility as well. There is enough blame to go around. Ever heard of predatory lending?
NO ONE WILL LOST THEIR HOUSE ANYMORE.
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We can give a 700 Billion Dollar Bailout for financial Insitutions who decevied some, by playing on their desperations to be bailed out of their financial debt. It is a great crime when we can look pass the faults of others who help create this mess while lining their pockets with great closing cost padded gain from the ingnorance of another. Why not take some of that 700 Billion dollar and bail out the tax payers who have found themselves in some of those faulty mortages which will created a relief for the tax payer and restore thier faith in our economy to make wiser decisions. We can not just blame the tax payers, when you have companies being bail out and taking resort trips. Who going to spank them. So before we start throwing rocks and stones lets do our home work and check our hearts.
Tracey,
Your not to bright, the poor pay nothing.
Mortgage companies are trying a lot of different things to try to restimulate the market. It’s interesting to see what the news is and what changes are taking place.
What!?!?!?! People put thierselves into this mess. People were making $30,000.00 a year and taking out $450,000.00 mortgages, it is the banks fault and the people! Do not get mad now because you bought something you could not pay for.
look lets be real there is a reason there are 12 people in court or in jail for preditory lending because to be a preditory it means to “PREY” on lesser . You had so many minorities doing all they can to try and get the american dream to then have these people swindling you out of your hand earned money. You see my god is a righteous one and his laws are eternal. You reap what you sown. That is why your markets are a shambles greed decietfulness and lies.
NO ONE WILL LOSE THEIR HOME.
NUMBER ONE PRIORITY HELPING THE MIDDLE CLASS. NO ONE WILL LOSE THEIRE HOME ,
I REPEAT NO ONE WILL LOSE THEIR HOME.
There is enough blame to go around. The government officials (on both sides) should not have allowed deregulation of the banks (predators) the indivudual should not have accepted the loans (uneducated victims) and that idiot Bush should not have asked/forced the American taxpayers to pick up the tab while banking CEO’s go party with the bailout money. That being said, personal responsibility would have helped a lot in this case. We all know what we can and can not afford. I would love to live in a mansion but I can afford to live in a house. Just because the bank offers you $750,000 mortgage loan to purchase your dream house (based on your credit NOT your paycheck) doesn’t mean that you should accept it and move in and worry about the payments later. NO!!! NO!!! NO!!! You must decline that $750,000 mortgage loan and accept a lesser amount that is within your current budget (look at your REAL paycheck) and go ahead and move into the cheaper house that you can afford. Living beneath your means is the best sleeping pill invented. Plus now you can afford some furniture, to put your kids thru a good college and to retire with dignity preferably before you drop dead!