WASHINGTON -- President Barack Obama's plan to aid troubled homeowners, set to be unveiled Wednesday, will include efforts to cut monthly mortgage payments, allow more borrowers to refinance their loans and give bankruptcy judges greater power to modify mortgages, according to people familiar with the proposal.
The array of options fills in some of the blanks left by Treasury Secretary Timothy Geithner last week when he unveiled the Obama administration's overhaul of the $700 billion financial-system bailout plan, which he said included an as-yet-to-be-outlined new approach to housing. Many economists say addressing the cycle of foreclosures and falling home prices is one key to ending the financial crisis.
At the heart of the plan is an effort to make loans more affordable by providing a government subsidy to help mortgage companies modify certain troubled loans. The administration is expected to kick in $50 billion out of the bailout fund to help mortgage companies with the costs of such an effort.
For complete article by Deborah Solomon in the Wall Street Journal click here.
Recent Comments