With more than 2.3 million foreclosure filings nationwide in 2008, foreclosure analysts are predicting 10 million more foreclosure filings in the coming years as the U.S. recession worsens. This is the figure Obama wants to reduce to more manageable levels with his $75 billion foreclosure fund.
Obama's economic advisers would not want to pre-empt the president by releasing details of the $75-billion foreclosure plan, but they have issued some information depicting a multi-pronged plan targeting homeowners, mortgage lenders and servicers, bankruptcy judges and government mortgage firms.
Among the components of Obama's foreclosure prevention plan are government subsidies to mortgage firms to enable them to offer significant loan modifications to borrowers; mortgage refinancing for borrowers whose mortgage balances are higher than the value of their homes; and the empowerment of bankruptcy judges to order mortgage terms, including interest rates and terms of payments.
The plan also involves Freddie Mac and Fannie Mae in more proactive ways, according to one Democratic official. The two government-controlled companies will develop loan modification standards for other banks to follow and will develop schemes to help millions of homeowners save their homes from foreclosures.
Previously, Treasury Secretary Timothy Geithner has already said the foreclosure program will benefit from a rescue plan that could circulate $2 trillion to energize the financial system and the nationwide economy.
The $75 billion foreclosure fund is part of the $787 billion funding that Obama asked and received from Congress for his economic stimulus program. He has just signed the stimulus package in Denver where he and Vice President Joe Biden visited on their way to Arizona. Included in the package are tax breaks for individuals and couples, incentives for energy efficient homes, additional funds for health care, money to fund kindergarten to 12th grade education, expanded unemployment benefits and increased food stamps.
The stimulus package will also help businesses to enable to keep certain jobs and create more jobs. Infrastructure funding will also be increased to build roads and bridges and develop mass transit systems and national parks. Billions will also be given to states to maintain school funding and support local governments and communities.
Obama is not only addressing the foreclosure problem or the economic recovery issue. He is also reminding Americans, legislators and fellow officials of the enormity of the country's federal debt which now adds up to $10.7 trillion. He is saying in his speeches that the road to recovery is not easy, but Americans will make progress and sustain the American dream.
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Joseph Smith has been educating buyers on the finer points of government foreclosures purchase at BankForeclosuresSale.com for over four years. Click here to visit and read more advice on finding repo homes.
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