$600 MILLION more going towards bailing out those in foreclosure!!

Discussion in 'Economics' started by S2007S, Aug 4, 2010.

  1. S2007S


    And more housing aid for those in foreclosure, what else is new. Where is the lesson being learned, seems there is no such thing as failure anymore. Seems like failures do get rewarded and that there is such a thing as a free lunch. Also keep in mind that housing prices are still overvalued due to the fact of the free $8000 dollar tax credits that were offered. These aid packages worth hundreds of millions of dollars for these states only keep housing prices up when in fact they should be 25-40% cheaper than they are right now. There is absolutely no need to keep housing prices higher, housing prices have been inflated beyond their norm over the last decade and should come down to a true market value. The only way to find that true market value is to stop the fucking free handouts, enough is enough.

    Wednesday, August 4, 2010 - 08:25
    Text: US Tsy Approves State Plans For $600 Mln Housing Fund

    WASHINGTON (MNI) - The following is a statement Wednesday by the U.S. Treasury Dept:

    State Housing Finance Agencies (HFAs) in North Carolina, Ohio, Oregon, Rhode Island and South Carolina can begin to use $600 million in foreclosure-prevention assistance from the Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (Hardest Hit Fund) under plans approved today by the Obama Administration. This assistance will support local initiatives to assist struggling homeowners in these five states that have high percentages of their population living in areas of economic distress due to unemployment.

    "These states have designed targeted programs with the potential to make a real difference in the lives of homeowners struggling to make their mortgage payments because of unemployment," said Treasury Assistant Secretary for Financial Stability Herb Allison. "While the Obama Administration has already taken critical action to strengthen the housing market and create jobs, we are committed to doing everything we can to immediately help those who are hurting the most during these tough times."

    The proposals approved today include targeted programs to expand options for homeowners struggling to make their mortgage payments because of unemployment, as well as programs to address first and second liens, facilitate short sales and/or deeds-in-lieu of foreclosure, and assist in the payment of arrearages. States estimate that approximately 50,000 struggling homeowners will receive aid.

    HFAs gathered public input and designed programs to meet the specific challenges facing struggling homeowners in their states. Each state HFA then determined how to design programs and target resources to meet their unique needs.

    The five HFAs submitted their Hardest Hit Fund proposals to Treasury on June 1. Treasury then reviewed each state's proposal to ensure compliance with the Emergency Economic Stabilization Act of 2008 (EESA) and offer technical assistance to develop performance and reporting metrics. These states will now begin to set up and execute their specific Hardest Hit Fund programs to provide relief to homeowners as soon as possible. Specific implementation timing will vary based on the types of programs offered, specific procurement procedures, and other factors in each individual state. Each state HFA will release more information in the near future about when they will begin to accept homeowner applications.

    President Obama established the Hardest Hit Fund in February 2010 to provide targeted aid to families in the states hit hardest by the downturn of the housing market. On June 23, the Obama Administration announced approval of state plans under the Hardest Hit Fund to provide $1.5 billion to the five states with home price declines of more than 20 percent: Arizona, California, Florida, Michigan and Nevada.

    A state-by-state summary of the Hardest Hit Fund proposals approved today is available below.

    North Carolina ($159 million)

    * North Carolina estimates that up to 7,190 homeowners will be aided through these targeted programs.

    - North Carolina will provide assistance to unemployed homeowners who are financially unable to make their mortgage payments and are in danger of losing their homes to foreclosure. The assistance will be used to pay mortgage and mortgage-related expenses while the homeowner secures employment or completes training for a new career.

    - The state will refinance existing second mortgages in partnership with the current lender in order to make the mortgage payments more affordable.

    - North Carolina will provide principal reduction of the first mortgage, which along with possible rate reduction and term extension by the current lender, will make the monthly mortgage payment more affordable.

    Ohio ($172 million)

    * Ohio estimates that 15,356 homeowners will be assisted through these targeted programs.

    - Ohio will provide assistance to bring delinquent mortgage payments current for borrowers who experience hardships due to a reduction or loss of income or other unforeseen circumstances.

    - Ohio will help unemployed borrowers pay their mortgage for up to 12 months while they search for a new job and/or participate in a job training program.

    - The state will set up a modification program to incentivize lenders and servicers to reduce a homeowner's mortgage principal balance to a target 115 percent or less of the loan-to-value, at which point the loan may be eligible for HAMP or another modification.

    - In order to facilitate a short sale or deed-in-lieu of foreclosure, the state will provide an incentive payment to the servicer as well as relocation aid to the borrower and payments in exchange for the release of second liens.

    Oregon ($88 million)

    - Oregon estimates that up to 7,400 homeowners will be aided through these targeted programs.

    - Oregon will provide funds to assist with loan modifications, including through principal reduction and arrearage payments.

    - The state will provide up to six months of mortgage payment assistance for an unemployed borrower or a borrower experiencing other financial distress. Lenders or servicers would be required to match for up to an additional six months.

    - Oregon will offer funds to ensure a successful modification or pay arrearages or other fees incurred during unemployment or financial distress once a homeowner has regained employment or recovered from that financial distress.

    - The state will provide assistance to borrowers that participated in the state's Hardest Hit Fund unemployed borrower program but did not subsequently regain employment in order to facilitate a short sale or deed-in-lieu of foreclosure. This assistance would be matched by lenders or servicers.

    Rhode Island ($43 million)

    * Rhode Island estimates that up to 5,000 homeowners will be aided through these targeted programs.

    - Rhode Island will provide assistance to eligible homeowners who otherwise would not qualify for the federal Home Affordable Modification Program (HAMP).

    - Rhode Island will also offer assistance to eligible homeowners who have mortgages with lenders or servicers who do not participate in HAMP. Proceeds will be used to assist the borrower and lender to achieve a loan modification.

    - Rhode Island will provide mortgage payment assistance to homeowners who are at risk of foreclosure due to temporary or immediate financial crisis caused by an uncontrollable increase in expenses or an uncontrollable decrease in income.

    - Rhode Island will provide payments to lien holders to facilitate a short sale or deed-in-lieu of foreclosure and assist with relocation expenses for homeowners who have suffered a financial crisis and are no longer able to stay in their home.

    South Carolina ($138 million)

    * South Carolina estimates that up to 12,000 homeowners will be aided though these targeted programs.

    * South Carolina will assist homeowners experiencing unemployment or short-term loss of income by making all or part of their mortgage payment for a period of time so that they can stay current on their mortgage.

    * The state will offer assistance to borrowers who have experienced a hardship but have regained the ability to pay. Funds can be used to pay arrearages, late charges, and reduce principal.

    * South Carolina will provide funds to servicers to assist in making borrowers HAMP-eligible.

    - The state will provide funds to modify second liens in order to allow the modification of the first lien.

    - In order to facilitate a short sale or deed-in-lieu of foreclosure, the state will provide funds to incentivize lien holders or help subsidize borrower relocation costs.
  2. AK100


    I like the quote from Mish's Blog re all the bailouts -

    "Stop please, we've been saved to death"
  3. MattF


    If each homeowner's mortgage is paid in full based on these numbers, these amounts will last, at best, 1-2 years.

    Throw a few partials, 2-3 years.

    Of course, other states may need to be bailed out next.

    Then back to these again.

    So, live in your home maybe for 2-3 more years, then get foreclosed on. This is why this crap will be dragged out for 3-5 years minimum. Any further home drops (5-10%) and we're up to roughly 7 years.
  4. TGregg


    Only suckers work for a living or settle for a house they can afford. Much better to get the biggest place you can con your way into, then get the democrats to give you money to pay for it.

    Who'd be stooopid enough to work for a living or pay their bills these days?
  5. pspr


    $600M? That's pocket change for Obummer. He spends that much every day before breakfast. And that's just on friends and family.

    BTW, that amounts to another $2 for every man, woman and child in Obummer's Amerika.
  6. high99


    Here is why they want to keep housing prices higher.

    About a 4-5 trillion dollar gap has been created.
  7. Not all states have sales tax, not all states have income tax. But ALL states have property tax, and it is the biggest source of funding for local gov't. If housing prices fall too much, they will need to be re-assessed at a lower level and local gov't across the country will implode. Now we see local gov't being backstopped by the federal gov't.

    So let's see.. that's the auto makers, investment banks, small banks, the unemployed, Wall St., insurance industry, now homeowners and local gov't. Who else is there to suckle on Uncle Sam's teat?
  8. Bob111


    100 % right..they can start re-asses right now..
    i've been waiting for it for very long time..to get into some munis...but...not a chance so far..