Mortgage Bankers association proposes a new plan to mortgage lenders to reduce the payments of those people who are out of job for up to nine months. Yesterday when MBA reported its weekly mortgage application data this news went unnoticed.
MBA communicated the plan to the Department of Treasury to underwrite the program if the mortgage lenders agree to reduce the monthly payments to more affordable level for those who are out of jobs and seeking employment. If the Treasury does underwrite it, the government will provide loans to lenders to offset the cost of payment reduction.
The proposed forbearance will be offered for a duration of up to nine months.
The plan is good keeping the jobless people in their homes. Almost no unemployed person can qualify for mortgage loan modification or reduction. MBA's president and CEO John A. Courson says this program will buy those distressed homeowners time. Most newly borrowed homeowners have experienced loss of income.
The potential homeowners will need to be evaluated for the program. To qualify, it is assumed that the unemployed homeowner will find a job within the next nine months. The new salary must be at least the 75 percent of the salary of the previous job.
MBA says they have talked to Fannie Mae and Fredie Mac about this proposal. They have also met officials at the White House, the Department of Treasury and the Department of Housing and Urban Development presenting the plan with hope of providing an affordable mortgage payment program to unemployed homeowners.
Written by Armen Hareyan
Comment and add to the story without registration, but keep the comments meaningful please. Links are not accepted.
