A continuing steep drop in home prices combined with rising unemployment is powering a new wave of foreclosures. Unfortunately, there’s little evidence, so far, that the Obama administration’s anti-foreclosure plan will be able to stop it.Over the past year or two, the government has come up with several plans to stop the wave of foreclosures. But, for the most part, these plans have done what government plans do best: Fail.
The plan offers up to $75 billion in incentives to lenders to reduce loan payments for troubled borrowers. Since it went into effect in March, some 100,000 homeowners have been offered a modification, according to the Treasury Department, though a tally is not yet available on how many offers have been accepted.
That’s a slow start given the administration’s goal of preventing up to four million foreclosures.
Friday, June 05, 2009
Foreclosure modification plans still failing
From The New York Times:
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Lower prices to a reasonable level. I would say 2000 levels and the housing problem will be solved and inventories will go to normal levels. VOILA!!
ReplyDeleteI guess the perceived failure of the government plan depends on which stakeholder you are. If you're in foreclosure and been denied assistance, it's an utter failure. Of course, not all foreclosures should be stopped and if the government has only found 100,000 homeowners for whom assistance would provide benefits to the economy on the whole, than I'm okay with that. Some are just hoping that no stability in the market is gained by stemming the rate of foreclosure because it benefit their own self-interests (RE infestors, first-time homebuyers, general opportunists). I'm of the latter category, so if it fails, I'll be there to exploit it. Otherwise, I understand why it must be done and don't complain when the government takes appropriate measures that don't conincide with my own self-interests.
ReplyDeleteit pains my cold heart to admit this but i sorta agree with anonymous above.
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