Finally, after presidential candidate Hillary Clinton speaks of addressing the foreclosure dilemma throughout the United States, with California being one of the hardest hit states, it looks like the current administration might be ready to address this issue.This was announced today through the Associated Press. The proposal, addressing sub prime borrowers, may provide them with an interest rate freeze of up to five years. Home loans that increased their interest rates before January 1, 2007 and folks that bought way over their financial head even without sub prime programs will not be eligible. Folks that are eligible obtained their loans between January 1, 2005 and July 1, 2007. Bush indicated that 1.2 million people could be eligible for help, however only a fraction of those will be eligible for a rate freeze. Others would get help in refinancing with their lenders or moving into a home loan secured by the Federal Housing Administration. Finally, any help will only come to those that ask for assistance.
Bush urged folks to contact a hot line number 1-888-995-HOPE. It is projected that this will provide relief to about 300,000 families. This is a voluntary private sector arrangement that involves no government money.
Right now, nearly one million homes are in foreclosure. President Bush states that if this increases, this could have dire consequences on our economy. Ya think? Bush has been widely criticized as moving too slowly on this issue.
Per the Ventura County Star, first quarter foreclosure sales in 2006 for Ventura County were 62. For the same period in 2007, foreclosure sales rose to 548. That is a increase of 784%. In Los Angeles County, foreclosure sales increased this first quarter at a rate of 675%. Santa
Barbara saw an increase of 768%.
Too bad this was not addressed when folks were being offered these impossible home loan programs. Countrywide is one of the current lenders offering to re-negotiate interest rates with borrowers, but as this author understands, this is only once the borrowers have entered foreclosure and not all borrowers will qualify for this assistance.
If you either have or are going to face these types of rate increases over the next two years, it would be wise to be proactive and start looking for any available options and watch government statements. Letters of concern to local representatives, congress persons, and senators will help keep the focus on this serious issue that so many are facing. Checking out the above hot line number for further information may be helpful as well.
6 comments:
Hey there..
First of all I really want to thank you for your comment and nice words on my blog! It means a lot to me.. thank you! So, I thought I would definetly pay you a visit ;)
Your blog is nice too.. It gaves me an impression of uniqueness in terms of content, layout and the way you have arranged it (customized).
Keep going man!
Best Wishes,
- Wakish -
(http://wakish.info)
Thank you for your kind comments, and thanks for visiting.
Can you tell us anything more about the organization behind the 1-800 number?
I'm curious to learn about their agenda.
While I don't invest in RE currently, I've been to a lot of Seminars and my partner DOES invest in RE so I hear a lot about this.
It's good to keep my fingers on the pulse too, since I will eventually get involved. It's the way 70% of the wealthiest people in the world build their wealth.
Good info, keep on posting!
Pam Hoffman
http://seminarlist.blogspot.com
p.s. thank you for waiting on this. ;)
Hi Pam and thanks for stopping by. I did further research on the number that Bush was recommending. I found that they are a non-profit agency that offers credit counseling and options to those facing foreclosure. The organization is called Homeownership Preservation Foundation. They are located at 8400 Normandale Lake Blvd. Suite 250, Minneapolis, MN 55437. They have 24 hour counseling available at 888-955-HOPE; also on the web at http://www.995hope.org. They have online counseling available when you visit their website. If you choose the online counseling, you are re-directed to a CCCS Atlanta site that is partnered with 888-995-HOPE. Their site states that they are approved by the US Department of Housing and Urban Development (HUD): and the HUD approved counseling agencies' purpose is to help families understand the home purchasing process, how to get budgeting and redit problems fixed, and how to avoid predatory lending practices. Their counselors have recieved specialized training in the mortgage industry and are provided with certification with either the AFCPE or NFCC. You can investigate both of these last agencies at http://www.afcpe.org and http://www.nfcc.org
Hope this helps.
The Bush proposal to freeze interest rates does not go far enough. It should be across the board for all adjustable rate mortgages made during the housing bubble.
The President made it a point to say that he was not rewarding people who made bad buying decisions and I have heard comments from people who feel that buyers should suffer the consequences of their choices. That's all well and good but this crisis could torpedo the entire economy. Something is broken in the hosing sector and we have to try to fix it. IT is not just a matter of a few buyers who made bad choices.
ROTUS:
I agree with you completely. I also think the irresponsible lenders that so loosened their borrower requirement are to blame. This is just like the credit card industry that gets a strangelehold on folks. I understand from a news interview, the some credit card companies, such as Discover and Bank of America, raise a borrowers interest rate if they discover their credit score has gone done. Well what kind of sense does that make? If someone is having a hard time paying their bills, does raising their interest rate help them?
I think this was all poised at taking advantage of folks when they were able to. This seems to something Pres. Bush has supported all along. He is all for big business, Cheney's business and the oil business; and what we have now are outrageous oil price and exponential government spending.
Also, what I don't understand is how we had such national outrage against Nixon, with demosntrations, etc., and now we have a nation asleep.
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