obama plan summary

[Dan Bailey]

WASHINGTON (Reuters) – President Barack Obama unveiled his much-anticipated plan on Wednesday to fight the U.S. housing crisis, pledging up to $275 billion to help stem a wave of foreclosures sweeping the country.
"All of us are paying a price for this home mortgage crisis. And all of us will pay an even steeper price if we allow this crisis to deepen - a crisis which is unraveling homeownership, the middle class, and the American Dream itself," Obama said in prepared remarks released on Wednesday.
Obama, who on Tuesday signed a landmark $787 billion economic stimulus bill aimed at jolting the U.S. economy out of recession, was to formally unveil his housing plan at 12:15 p.m. EST in Mesa, Arizona.
The U.S. housing crisis has played a central role in the financial and credit turmoil now spread across the globe, with many U.S. homeowners saddled with mortgages they cannot pay.
At the end of last year, just over 9 percent of all home loans in the United States were in arrears or already in foreclosure, the Mortgage Bankers Association has said.
A total of 8.1 million U.S. homes, or 16 percent of all households with mortgages, could fall into foreclosure by 2012, according to a report by Credit Suisse.
An Obama administration official said the total plan commits up to $275 billion for housing, including $50 billion from funds already committed in the country's financial sector bailout. It aims to help up to 9 million American families.
Mindful of critics who might charge that the scheme would help people who just took on far more debt than they could afford, Obama said his plan was aimed at "rescuing families who have played by the rules and acted responsibly," refinancing traditional mortgages for up 5 million homeowners who now are close to owing more than their homes are worth.
It will also establish a $75 billion fund to reduce monthly payments for another 3 million to 4 million homeowners "stuck in sub-prime mortgages they can't afford as a result of skyrocketing interest rates or personal misfortune," Obama said.
The Obama administration's summary of the plan said the plan could offer a buffer of up to $6,000 against value declines on the average home.
AIMS TO HEAD OFF WORSE PROBLEMS
The plan also aims to increase confidence in mortgage giants Fannie Mae and Freddie Mac through Treasury funding to "ensure the strength and security of the mortgage market and to help maintain mortgage affordability," the plan summary said.
"This initiative is intended to reach millions of responsible homeowners who are struggling to afford their mortgage payments because of the current recession, yet cannot sell their homes because prices have fallen so significantly," the summary said.
"By making these investments in foreclosure-prevention today, we will save ourselves the costs of foreclosure tomorrow - costs borne not just by families with troubled loans, but by their neighbors and communities and by our economy as a whole," Obama said.
The Treasury Department will double its financial support for housing finance giants Fannie Mae and Freddie Mac to allow them to play a bigger role supporting housing.
The Treasury said it was increasing its preferred stock purchase agreements with the two government-controlled companies to $200 billion each from $100 billion.
It also said it was raising the limit on the size of the mortgage portfolios the two companies can hold by $50 billion to $900 billion each, along with a corresponding increase in their allowable debt outstanding.

[Schnelle]

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[Ledeen]

So if we are over the conforming loan limits it wont do us any good?

[AZ Meltdown]

Here is the math......
$275 billion/9 million homeowners to be helped is about $30,000 each.

Many homes are $100,000 or $200,000 UNDERWATER! Or more.

Mine was, about $175,000 underwater. If they payed down my loan where it was practical to stay and continue paying the mortgage, 9 other of the 9 million would get no help.

This is another Govt plan that is destined to fail.

[AZ Meltdown]

Plus you can only be 5% underwater on the 1st to qualify.

That right there excludes 95% of Arizona homeowners who are walking away!!

[jet-a]

Originally Posted by AZ Meltdown

Plus you can only be 5% underwater on the 1st to qualify.

That right there excludes 95% of Arizona homeowners who are walking away!!

I wonder if this means that those in AZ (which includes me)will qualify for a modification under the plan instead of a refi?

Hopefully that will be the case!

[FacingNorth]

Wow, did Obama indicate the 5% part of the deal in his speech in Mesa? Seems like the roaring crowd would have gotten quiet fast.

[flowride]

Well...doesn't help me one bit. Both mortgage holders are telling me to piss off because I don't fall within their investors guidelines for a mod. LOL...all I wanted was a nice, lower, fixed rate for a 30 year on both places. My only recourse seems to be short sale or deed in lieu. It just amazes me how these people want to make you short sell and ruin your credit when all they need to do is drop your rate and give you a fixed loan. These investors must be getting one hell of a tax break or they really want to be land barons.

Totally sucks because I've done everything I can to keep things on the up & up, including hiring an attorney firm to help straighten this mess out. Really, who has time to call upon banks when you're working 60-72 hours a week to pay mortgages?

So...if anyone's done the whole short sale thing, can you throw a heads up as to how it's affected your credit?

[Dan Bailey]

I cannot help but feel very dissappointed-not shocked at all...but very dissappointed.

[chazkeepahoma]

This is all really sad. If congress passes the BK part of Obama's plan the courts are going to be FLOODED!

[jillven]

Is anyone aware of any information in Obamas plan to help homeowners with Predatory loans?

[cactus77727]

Donald Trump was on TV this week. While explaining away another one of his multimillion dollar failures, he said: "bankruptcy is just a tool". So take it from one of the most successful men in America folks. Bankruptcy bombs away!!!

[chefette]

Funny Cactus I was thinking of Trump this morning. BK's and foreclosures only make this guy laugh. He KNOWS what tools to use in order to rebound. Thats what most folks here need to understand. Many smart people cut thier losses and move on while they still can. These things make you smarter, stronger,wiser.......fighter.

[Woodland Hills Worrier]

Once again, the winner is the banking industry who appear to own both Geithner and Summers and who are able to pretty much write the plan. Looks like each homeowner will be allowed to twist into the wind before falling into the dust. The latest manuver is to blame the "deadbeats" which are those who are upside down because they took out home improvement loans. This allows the real villains, the bankers/lenders, to slip away into the night. Probably the real truth is that the banks are so overleveraged and so much of their debt is turning toxic that they can only appease their investors by spreading out their losses over time. Since they are too big to fail according to the govt, then it is the millions of individual homeowners who will be allowed to fail. Clever, but I don't think you can fool all of the people all of the time. It's time to organize.

[AZ Meltdown]

[QUOTE=Woodland Hills Worrier;64733]Once again, the winner is the banking industry who appear to own both Geithner and Summers and who are able to pretty much write the plan. QUOTE]

The banking industry OWNS both parties with a few exceptions such as congressman Ron Paul.

If one examines who contributed toward Obama's inauguration bash it was the financial industry donated the most.

The struggling finance, insurance and real estate sector still managed to pull together at least $7.1 million in contributions for Obama's inauguration, leading all sectors in giving. Financier George Soros and his extended family contributed at least $250,000. The miscellaneous business sector, which ranges from retailers to liquor companies and advertising firms, is next, donating $4.9 million, followed by $3.3 million from the communications and electronics sector, which includes technology companies. Lawyers and lobbyists have given $3 million. (As he did during the campaign, Obama is refusing contributions from registered federal lobbyists but accepts money from their family members and coworkers who aren't registered.)

Looking at specific industries within these sectors, the securities and investment industry ranks first. Individuals with Wall Street ties--118 of them--have contributed more than $3.6 million, or an average of $30,534 each.

From
opensecrets.org/news/2009/01/no-logos-but-corporate-represe.html

There was no change......it is business as usual.
The taxpayers need to accept that voting for mainstream candidates is against their own interests and that of the country.