President Barack Obama is deciding on new ways to slow down foreclosures for homeowners to also happen to be jobless and unable to keep up with monthly payments. The New York Post spoke of the reasonableness for policymakers to consider options dealing with borrowers being able to delay or even skip payments.
The number of failing home loans has been going up for three straight years as unsure borrowers have given up on their easily obtained loans. Not to mention the property values have sunk and the unemployment rate is still poor. The idea is still being tossed around with potential hazards in mind such as: it could help more people fighting with economic turmoil, but it also could create perverse incentives that make the housing market look bad.
Government officials have been annoyed as more rules and rising mortgage rates have slowed a housing rescue plan that was supposed to be in effect by February that was made to refinance 5 million borrowers and lower monthly payments for 4 million. Jay Brinkmann, chief economist for the Mortgage Bankers Association said, “All these numbers keep going up. We are not anywhere near the bottom.”
This report also showed that seriously delinquent mortgages, defined as loans that are 60 or more days past due, increased by 9% from the prior quarter to 5% of all mortgages in the portfolio. The Treasury Department asked the largest 25 mortgage service companies last week to appoint a special liaison officer to work directly with government officials trying to stem defaults.