Don't let your neighbor get away with paying less than you did because they screwed up and you didn't. This is a once in a lifetime opportuntiy.
Federal mortgage rescue plan due. Fannie Mae, Freddie Mac and the administration officials are set to announce program to help at-risk homeowners.
NEW YORK (CNNMoney.com) -- The Bush administration is set to unveil on Tuesday a potentially extensive new program to modify mortgages and help at-risk homeowners and stabilize the battered real estate market.
The plan centers on Fannie Mae and Freddie Mac, which between them own or back about $5 trillion in loans. The federal government took over the firms in September due to mounting losses on their portfolios of mortgages.
While a number of major banks, including Citigroup (C, Fortune 500), JPMorgan Chase (JPM, Fortune 500) and Bank of America (BAC, Fortune 500), have announced loan modifications programs in recent weeks, they hold only a fraction of the nation's mortgages compared with Fannie and Freddie.
Despite calls from members of Congress and some housing advocates for the government to take a more direct role in preventing foreclosures, federal agencies have been slow to present their own plans to modify the loans of millions of homeowners at risk.
Sheila Bair, the chairman of the Federal Deposit Insurance Corp. whose agency took over home lender IndyMac in July, testified to the Senate Banking Committee on Oct. 23 that her agency was working "closely and creatively" with the Treasury Department on a mortgage rescue plan but revealed few details.
She suggested the government would establish standards for loan modifications and provide guarantees for loans meeting those standards so that "unaffordable loans could be converted into loans that are sustainable over the long term." http://money.cnn.com/2008/11/11/news/economy/loan_modification/index.htm
