Stop Home Foreclosure

The primary strategy of the program of the President designed to counter the increasing number of foreclosures is the transfer of some of the funds that have been established by US Congress for the bailout of the financial services industry to the Making Home Affordable Program. The Obama Foreclosure 2009 initiative has three main goals and these are: the provision of incentives to banks and lenders if they approve more loan modifications, encourage more refinancing, and increase the number of new home loans.

One of the plans of the President is to assist homeowners who have been affected by the drastic decline in home market values to obtain the approval of their lenders for a refinancing of their loans to make their monthly payments more reasonable. The key requirement to be entitled for this part of the plan of the Obama Foreclosure 2009 program is to have a loan balance that does not exceed 105 percent of the prevailing market value of the property.

Meanwhile, the second component wants to induce the banks and other lenders to agree to the applications for loan modifications to ensure that the monthly payments are also affordable by making sure that they do not make up more than 31 percent of the borrower’s monthly salary. Finally, the Obama Foreclosure 2009 program has allocated more funds to Fannie Mae and Freddie Mac to let them provide more new home loans.

The Making Home Affordable Program, which is the official title of the Obama Foreclosure 2009 initiative, has not achieved impressive results as of the month of September. Nevertheless, some people are of the opinion that the plan of the President is finally bearing fruit. It is believed that the Obama Foreclosure 2009 initiative has reversed the trend of sliding home values and increasing foreclosure rates in some states. Unfortunately, some of Obama’s critics are still unconvinced because they have observed that only a small fraction of those who have applied for loan modifications have been given the go signal.

A number of these critics point out that the Obama Foreclosure 2009 initiative has not been based on accepted economic principles. Nevertheless, the Obama Administration continues to be optimistic about the outcome of the program and has been incessantly reporting to the public regarding its progress. This was made evident when the Administration declared that it has attained a milestone almost one month before its scheduled accomplishment. The program’s goal of causing the approval of more than 500,000 home loan modifications has been reached before its due date. Therefore, some people remain optimistic about the Obama Foreclosure 2009 plan, thinking that it may soon achieve what the President wants for his country.