Announced this week, six of the nation's largest mortgage lenders have temporarily stopped foreclosure proceedings, in a joint effort to cool the raging foreclosure crisis.
Under a new program, called Project Lifeline, legal efforts to oust seriously delinquent borrowers from their homes will be postponed for 30 days. During that time, lenders and borrowers will try to work out payment options on a case-by-case basis.
Project Lifeline will not be confined to borrowers with adjustable rate mortgages (ARMs), according to the prepared remarks of Alphonso Jackson, secretary of Housing and Urban Development (HUD), that accompanied the announcement of the program.
The lenders already on board are Citigroup, Countrywide, Bank of America, JPMorgan Chase, Washington Mutual and Wells Fargo. More may sign up if Project Lifeline meets with success. The program was put together with the backing of Jackson, Treasury Secretary Henry Paulson and Faith Schwartz, director of Hope Now, the government-backed, foreclosure prevention coalition.
During the temporary moratorium, foreclosure prevention specialists will examine individual cases to see if there's a good possibility that, through some kind of loan modification or repayment plan, borrowers will be able to regain their footing, start paying their mortgage again and remain in their homes.
Secretary Jackson sees the program as one more step in a multifaceted approach to meeting the foreclosure crisis. Project Lifeline will supplement such efforts as: FHASecure, which is refinancing many adjustable rate mortgage borrowers into government insured fixed rate loans; the rate freeze, brokered by the Treasury Department, a five-year suspension of interest rate increases for many at-risk, subprime ARM borrowers; and the provisions of the economic stimulus package that increase cap limits for loans eligible for purchase by Freddie Mac and Fannie Mae that should lower borrowing costs for many homeowners in high-cost areas.
If I can provide additional information let me know. For Wilmington NC area information visit www.thekeytowilmington.com
Diane Parker, Broker/Realtor/e-PRO
