Six Major Banks to Unveil Plan to Halt Foreclosures

[Robbien]

Source: Reuters

Six of the largest U.S. mortgage lenders will announce on Tuesday a program to identify seriously delinquent borrowers and halt any foreclosure process while they try to work out a new payment scheme, sources familiar with the plan said.

The lenders will unite under the program, dubbed "Project Lifeline," to identify borrowers more than 60 days delinquent and stall any foreclosure proceedings while they try to develop new loan terms, the sources told Reuters.

. . .


. . .

Under the newest program, Countrywide and ACORN will offer subprime borrowers who have fallen behind on payments such options as rate freezes and reductions, and short-term repayment plans.

Countrywide will also offer relief for borrowers with subprime "hybrid" ARMs, which carry low "teaser" rates that often jump after two or three years.

It said borrowers with strong payment records, but who have or may face difficulty as rates reset, may be able to refinance into prime loans, or get a five-year rate freeze.

"No subprime borrower who has the ability and willingness to make payments should face foreclosure," Maude Hurd, ACORN's president, said on a conference call.

Read more: http://www.cnbc.com/id/23115224

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Which sounds much better than the Bush Admin mortgage plan which is failing miserably.

[Zorra]

1. The last thing a bank wants to do is repossess an overpriced,

unsellable house.

Paying taxes and property upkeep is a moneypit.

[rfranklin]

3. No, but they would gladly let the government bail them out...

This is going to be a repeat of the Savings and Loan rip-off. (Ever notice how this always happens with a Republican in the White House?)

[flvegan]

6. They also have to keep making that monthly payment to Fannie/Freddie.

Just cuz the borrower doesn't pay, doesn't mean the bank doesn't pay.

I'm glad that it looks like they're learning.

[Extend a Hand]

2. for upside-down borrowers

it's often in their best financial interest just to walk away and take the credit hit.
The banks aren't doing this just to be nice...

[Javaman]

4. Man, I just got a weird shutter down my spine...

Like when you are watching a suspenseful movie and just when you think the hero has solved, killed, prevented whatever, you look at your watch and you realize that there is still 20 minutes left in the show. And all the hero did was stop the mini disaster from happening, and not the major one.

I just got that feeling after I read this. This will fix something but I fear it will only be a small fix and the big meltdown is still ticking away in some broom closet across town.

[Demeter]

9. More LIke 20 Years than 20 Minutes Left in This Horror Show

Yeah, it's called waiting for the other shoe to drop.

I've been waiting for the shoe to drop on Bush....


..............still waiting!

[HowHasItComeToThis]

5. HOMES ARE OVERPRICED, PERIOD

THAT IS THE PROBLEM

[rpannier]

7. Gee... Bush Admin in the same sentence with the word failure

That only happens...everytime.

[Sen. Walter Sobchak]

8. Foreclosure is the best thing that could happen for some

Nobody is being done any favors by allowing them to remain in a property for which their mortgage greatly exceeds any tangible value of the property.

If your going destroy your credit you might as well get out from under an obscene mortgage while your at it.

[InkAddict]

10. Oh boy, big fix until the next financed outsourcing, H1B influx, and

unable to maintain credit downsizing, going-out-of business closures ravage jobs and careers -- still a good bet to happen.

[DCKit]

11. It really makes you wonder what the lenders had planned.

There's no way in hell they were going to be able to pull this off, even in a healthy economy. Anyone in the business too stupid to see what was going to happen to the insanely overheated real estate market needs to be locked up for what they've done as much as to keep them from ever breeding and inflicting another generation of stupid, greedy Republicans on the rest of us.

Unless there was a short-term plan for upper management to take their money and run - screw the company, stockholders and mortgage holders, a la Enron and Tyco - the intentional damage they have inflicted on the corporations, the economy and people makes no sense at all.

Unlike the S&L bailout where there were few, if any, prosecutions, and very little money recovered, the creators and enablers of the sub-prime, interest only and exotic loan schemes need to be fully investigated, prosecuted and their assets seized. The government needs to recover assets for a bailout from those who perpetrated the crime, not from our empty treasury and the pockets of future generations.

Unless a severe example is set, it's just a matter of time until someone comes up with another, equally devastating scheme to defraud the country. When are we going to say "ENOUGH"?