As of Tuesday the Obama administration had released very few details on how it plans to specifically help struggling homeowners. Odds are pretty good that the efforts will be directed to prompting banks to modify more loans but there is a push to revamp and revive the failed Hope For Homeowners programs as well. Here are some quotes from a recent AP article on the subject:
To those on the front lines of the housing crisis, the Obama administration’s pledge to spend $50 billion to combat foreclosures was a welcome change in the government’s approach. But the actual plan won’t be unveiled for at least a week and might not be enough to prevent the housing market’s troubles from mushrooming further.
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“The question is: Can we work to design a system where the banks recognize it’s in their interest to avoid foreclosure?” Obama said Tuesday in Fort Myers, Fla., which has been devastated by foreclosures and sinking home prices.
Obama said he would announce his housing strategy in the coming weeks. Meanwhile, home prices are not expected to hit bottom until year-end at the earliest.
A report published this month by Moody’s Economy.com projected that home prices will plummet by at least 50 percent in more than 30 metro areas in California, Florida and Nevada by the time the housing bust ends. More than 60 percent of all metro areas nationally are expected to see prices fall by 10 percent or more, the study found.
While Treasury Secretary Timothy Geithner’s revised plan to stabilize the financial system offered few details about housing on Tuesday, consumer advocates said they were still confident that the forthcoming proposal would offer far-reaching help to borrowers.
“It’s a tough problem,” said Michael Calhoun, president of the Durham N.C.-based Center for Responsible Lending. “They want to make sure to get it right.”
Less patient was Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee. He issued a statement criticizing the administration for taking too long to put together a housing plan.