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Monday, October 10, 2011

Obama’s Floundering Foreclosure Programs

More than 6 million Americans are behind on their mortgage payments or facing foreclosure [1]. Housing prices have continued to drop [2], and many neighborhoods across the U.S. are filled with foreclosed homes [3].

What exactly has the administration done in the face of such historic need? We've put together a guide to the administration's major efforts to help homeowners, laying out the promise of each and how they've actually performed.

It's a sobering list. Obama himself has called his approach to the foreclosure crisis one of his biggest mistakes [4] dealing with the recession. Overall, the foreclosure programs have failed to reach more than a fraction of the homeowners they were designed to help.
Here are the depressing details:

Programs That Have Been Enacted

Plan: Help millions of homeowners by encouraging servicers to lower mortgage payments
Obama launched his "homeowner bailout," Making Home Affordable [5], in the spring of 2009, with the aim of helping at least 3 million to 4 million homeowners avoid foreclosure. The program gives banks and other mortgage servicers modest incentives to adjust the terms of mortgages so that homeowners who can't afford their current monthly payments can stay in their homes.

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