Obama’s signature foreclosure rescue plan is losing its punch

The president's signature foreclosure rescue plan is losing its punchAccording to a federal report released Friday, the president’s signature foreclosure rescue plan is losing its punch.

Only 36,695 homeowners were lucky to receive long-term modifications in July under the Obama administration’s Home Affordable Modification Program (HAMP). 434,717 borrowers have successfully made it out of the trial phase.

12,912 homeowners had their permanent modifications canceled in July, 272 of whom paid off their loans.

Unfortunately it is literally impossible to help every troubled homeowner, but the foreclosure program tries to give benefit to majority, according to Obama officials.

Foreclosure prevention programs have taken on renewed importance with the housing market on shaky ground again. A spike in foreclosures, combined with weak housing sales, could send home prices plummeting again.

In July, foreclosures were up 3.6% from the month before but down 9.7% from the year earlier period, according to RealtyTrac.

But however, the launched program promises to reduce monthly payments for troubled homowners and make it no more than 31% of their pre-tax income.

Meanwhile, the government is going to roll out another fix for the housing market. According to it, borrowers can start to apply for the FHA Short Refinance option starting September, 7.

Leave a comment: