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Mortgage Aid Program to Bring Hope for Homeowners

Much of the banking drama from the last few weeks can be traced back to bad mortgage bets, making us wish that homeowners were never approved for loans they never could have afforded. Yesterday, a government drafted mortgage aid program launched into action that aims to contain the mortgage crisis from causing more trouble. The $300 billion, three-year initiative aims to allow about 400,000 homeowners to exchange their existing mortgages for more affordable ones, therefore staving off potential foreclosures.

Lenders must first decide if they want to participate in the program as they'd be taking losses on the existing loans, and it's not clear if the so-called "Hope for Homeowners" program will go over well in the industry. A report by the State Foreclosure Prevention Working Group is critical of the initiative and found that in the past year, about one in five loans that were adjusted to give more favorable lending terms became delinquent again. What do you think of the mortgage aid program? Are you hopeful that it will prevent more foreclosures?


Join The Conversation
hmcmcd hmcmcd 8 years
I think for the economy it is worth it to offer this aid. If 1 out 5 take the aid but are then delinquent again, there are still the other 4 that now are making their payments. But I agree with hippie the consumer really should be educated about what they are doing when they buy house. I am a little frustrated from the top down for this whole mess. Yes, the banks should never have lent money to "risky" borrowers but the borrowers should never have accepted the loan. When I bought my first house, i did SOOOOO much research and we ended up buying a home WAY below what we could actually afford, b/c I didn't want to end up in a bad situation. I also would NEVER accept a "funky" mortagage. 30 or 15 year fixed is the only way to go. I never really understood why people would gamble with an ARM or balloon mortgage. Buying a home is for most people THE biggest investment they will ever make, why would you make a gamble like that. I blame both the banks and the consumers.
GlowingMoon GlowingMoon 8 years
I have mixed feelings about this.
Renees3 Renees3 8 years
It's really sad that so many people are losing homes, but I don' tknow if bailing them out will make everything better. My moms a mail carrier and she see's foreclosure notices Daily. She said most people just toss them. But on the other side, we're closing on a house Oct 28th that's a foreclosure that we're buying for half the price it should be. It's a dream come true for us.
hippiecowgirl hippiecowgirl 8 years
I wish these programs offered more consumer education along with the financial help. Giving aid is a great short term fix, but homeowners also need to know how to avoid making the same mistakes in the future.
ilanac13 ilanac13 8 years
i think that i need to hear more about this to understand if i think that it'll help or not. i have a mortgage and i have fears that i'll be stuck not being able to make payments on it when it adjusts and i think that if there was a way for me to get aid, then it might ba good thing. i used to get frustrated when i heard about all the people that were just getting away with these houses that they couldn't afford and there was gov't help to get them out of the bad situation, but knowing where we are now - i guess you have to do what you can, and if there is aid - then it's a necessary evil.
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