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All Options on Table in Fight to Halt Foreclosure

Obama considering moratorium, gov't-sponsored refinancing

By Jim O'Neill,  Newser User

Posted Jan 26, 2009 8:54 AM CST
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(Newser) – The Obama administration is considering plans to stem the tide of foreclosures ranging from doubling the mortgage interest deduction to a six-month foreclosure moratorium to government-sponsored refinancing, reports the Los Angeles Times. But a strategy is still at least several weeks away and, regardless of what bandages are applied, “many people will lose their houses anyway,” one economist predicts.

How to solve the crisis—as well as who should bear the brunt of the cost—remains unclear. Key to any resolution: that irresponsible borrowers not reap windfalls. Obama economic adviser Lawrence Summers told Congress the administration will commit up to $100 billion to resolve the issue, but said not everyone will be helped. And imposing solutions on lenders could make their fragile situations even worse.

A foreclosure sign stands on top of a sale sign outside an existing home for sale in the west Denver suburb of Lakewood, Colo.
A foreclosure sign stands on top of a sale sign outside an existing home for sale in the west Denver suburb of Lakewood, Colo.   (AP Photo)
Bank repo, foreclosure and for sale signs sit outside a foreclosed home in Houston. Most congressional Democrats say the quickest way to save homeowners is to let them declare bankruptcy.
Bank repo, foreclosure and for sale signs sit outside a foreclosed home in Houston. Most congressional Democrats say the quickest way to save homeowners is to let them declare bankruptcy.   (AP Photo)
A foreclosure sign sits on top of a sale placard outside an home on the market in the south Denver suburb of Littleton, Colo.
A foreclosure sign sits on top of a sale placard outside an home on the market in the south Denver suburb of Littleton, Colo.   (AP Photo/David Zalubowski)
A foreclosure sign stands on top of a sale sign outside an existing home for sale in the west Denver suburb of Lakewood, Colo.
A foreclosure sign stands on top of a sale sign outside an existing home for sale in the west Denver suburb of Lakewood, Colo.   (AP Photo)
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COMMENTS
Showing 3 of 4 comments
Guest
Jan 27, 2009 3:47 AM CST
If over 80% of the buyers in the last few years could not afford the homes they bought, how does the government help them? And we haven't even got to the missing jobs part yet.
Mad
Jan 26, 2009 2:15 AM CST
As long as you keep your payments semi-current, then the banks should work with you. I've managed to keep my mortgage current though out this ordeal - whats my prize?
Guest
Jan 25, 2009 11:58 PM CST
Agreed. The banks got our money in the bailout, now make them do something for the average American who is struggling to make ends meet. Hell, they should have just given every adult American $100 K-- we could have paid our bills and bought new cars, then the corporations wouldn't have needed the bloody bailout to begin with!

Housing market contraction has gone far enough; the feds must act
Barron's

Renters feel pinch of foreclosure, too
Press of Atlantic City

 
mortgage • credit crisis • housing crisis • Obama administration • financial crisis • refinancing • President Obama • foreclosures

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