WASHINGTON (2/16/09)—President Barack Obama is widely expected to announce details of his foreclosure prevention plan some time in the next few weeks, even though U.S. Treasury Secretary Timothy Geithner seemed to indicate in a recent speech the plan may still be a work in progress. The Credit Union National Association has compiled details Geithner has revealed may likely be included in the administration plan. They include the following:
* A commitment to driving down overall mortgage rates by expanding, as necessary, the current effort by the Federal Reserve to spend as much as $600 billion to purchase government-sponsored enterprise (GSE) mortgage-backed securities and GSE debt. The lower mortgage rates are intended to free up funds for working families; * A commitment of $50 billion to prevent avoidable foreclosures of owner-occupied middle-class homes by helping to reduce monthly payments in line with prudent underwriting and long-term loan performance; * An effort to bring order and consistency to the various existing efforts to address the foreclosure crisis by establishing loan modification guidelines and standards for government and private programs; * A requirement that all Financial Stability Plan (FSP) recipients participate in foreclosure mitigation plans consistent with Treasury guidance. The FSP is the administration’s revised Troubled Asset Relief Program (TARP) plan; and * Building flexibility into Hope for Homeowners (H4H) and the Federal Housing Administration to enable loan modifications for a greater number of distressed borrowers.
has reported that Obama himself may announce the foreclosure prevention plan as early as this week.