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Obama Administration Plans to Move More Aggressively to Help Consumers Facing Foreclosure

By Brian Wolfman

The lead story in today's Washington Post explains that the Obama Administration is planning to overhaul its aid program for consumers facing foreclosure. Apparently, the Administration believes that its current program is not helping enough, particularly in light of persistent high unemployment. The story begins this way:

The Obama administration plans to overhaul how it is tackling the foreclosure crisis, in part by requiring lenders to temporarily slash or eliminate monthly mortgage payments for many borrowers who are unemployed, senior officials said Thursday. Banks and other lenders would have to reduce the payments to no more than 31 percent of a borrower's income, which would typically be the amount of unemployment insurance, for three to six months. In some cases, administration officials said, a lender could allow a borrower to skip payments altogether.

The Post story is accompanied by this Q&A explaining how the new program will work and its eligibility rules.

Full post as published by CL&P Blog on March 26, 2010 (boomark / email).