As you may have already heard, President Obama released information about his new foreclosure plan for homeowners with details to follow on March 4th. This is part two of the government's attempt to fix this housing crisis. On Oct.1, 2008, a $300 billion dollar Hope For Homeowners plan made to target approximately 400,000 homeowners has successfully helped 22 people as of January 24th. That's right, 22 people in four months (Click on this link to see a FHA report sent to Congress last month). Now with a new bill proposing $75 billion, 75% less money to use than the last bill, how will this help 9 million homeowners?
Let's take a look at the few facts already available about this new proposed bill:
1) Lenders are not required to modify loans, it is strictly voluntary. This stipulation was set in the previous bill and will remain in this one.
2) Only first mortgages will be eligible for modification. Second mortgages can NOT be modified.
These two facts alone are already telling us that this bill will result in the same type of disappointment as its predecessor and will continue to acknowledge the fact that the only way to achieve real help is through an experienced attorney-backed negotiation team. Again, my company exists for savy clients that realize the government is not in a position to convince investors to take ridiculous losses through small incentives.
P.S. Did you know that the government holds preferred shares/stocks in banks like Bank of America, Citigroup, Chase and Wells Fargo? Something to think about.