The $26 billion mortgage settlement announced yesterday will be a boon for some—but the terms of the deal leave many homeowners out in the cold. Recipients of loans owned by the Federal Housing Administration, for instance, won't directly benefit from the settlement; nor will those with mortgages held by private investors, the New York Times reports. Millions of Fannie Mae and Freddie Mac loans—about half of America's mortgages—aren't part of the plan, either.
Economists have mixed expectations regarding the settlement's effects. In the long term, it should help the housing market recover, Bloomberg notes, though economists tell the Times they don't expect this to be a huge win for the economy because banks have three years to dole out the money. And in the immediate future, things could get harder for struggling homeowners. Foreclosures slowed as banks and officials negotiated the deal; now that it's done, we may see another rash of home seizures. "It is frankly a headline victory for both banks and attorneys general with a modest impact on the housing market," an analyst tells the Wall Street Journal.