Secretary Treasurer Paulson said, “This is no silver bullet.”
President Bush commented, “The administration’s response to foreclosure fears was designed to avoid bailing out lenders, real estate speculators or those “who made a decision to buy a home they knew they could never afford.”
House Financial Services Committee Chairman Barney Frank said, ” “I welcome it.” He then later commented, “There are a couple of problems with it. It’s a
“grave error”that there’s a cutoff at a 660 FICO score,” he said. That penalizes those who struggled to maintain good credit profiles, he said. Frank also faulted the plan for failing to address the penalty for prepaying many subprime mortgages.”
Rep. Maxine Waters (D-Los Angeles) had this to say, “”We may never know how many borrowers could have kept their homes if the process had started sooner rather than later.”
“I think the plan is good in theory,”
said Mark Zandi, chief economist for Moody’s Economy.com, “but, in practice, it’s going to come up short. There are too many impediments to its widespread adoption by investors and servicers.”
That makes it a “start in the right direction,”
said Darla Keegan, speaking for Novadebt, a national nonprofit housing and credit counseling agency, because it will move some borrowers through the system quickly.
Mortgage counseling services are currently stretched.
Bruce Marks of NACA.com says, “The number of borrowers affected by the plan is very small, but it sets the precedent and standard so that more borrowers can be helped down the road.”