President Obama rolled out his plan to stop, or at least slow, the foreclosure wave sweeping the nation on Wednesday. Estimated to cost $75 billion, the program is designed to rescue up to 9 million homeowners from foreclosure and stabilize the collapsing housing market. According to the plan, lenders are asked to reduce monthly interest payments to 38 percent of the mortgage holder’s income. After that is done, the government will step in with funding to reduce payments to 31 percent of the individual’s income. This 7-percentage-point funding will go directly to lenders. To gain access to assistance, homeowners should work with their lenders and the lenders will contact the government. It is hoped lenders will send their hardest cases to the government for assistance. Full documentation of the program is available from the White House Web site. Although no one is sure how this will all play out, experts are already weighing in on. The program is set to launch March 4th.
Credit: NPR
