Lenders Agree to Freeze Rates on Some Loans

[FourScore]

The Bush administration reached an agreement with the mortgage industry on Wednesday on a plan to freeze interest rates for up to five years for a portion of the two million homeowners who bought houses in the last few years with subprime loans.

The plan, hammered out after weeks of talks among Treasury Department officials, mortgage lenders and Wall Street firms, would allow distressed borrowers who are current on their payments to keep their low introductory rates and escape an increase of 30 percent or more in their monthly payments when the rates expire.

Democratic lawmakers and presidential contenders quickly criticized the plan as being too timid and promoted more ambitious proposals of their own.

The agreement, to be formally announced Thursday by President Bush, is expected to contain numerous limitations that would exclude many — if not most — subprime borrowers, according to industry executives who have seen it. It would exclude those who are delinquent on their payments — about 22 percent of all subprime borrowers, according to First American LoanPerformance, an industry research firm.

The plan is also expected to exclude any borrower whose introductory rate expires before Jan. 1. About $57 billion in subprime loans are scheduled to be reset at higher rates in the final three months of this year, according to estimates by First American LoanPerformance...

http://www.nytimes.com/2007/12/06/washington/06debt.html?_r=1&ref=politics&oref=slogin

[Blackhatjack]

1. This plan helps the most well off.... just as we would expect from Bush....

So for lack of a couple of thousand dollars to bring their mortgages current, a home owner will be denied the benefit of keeping their current rate for up to 5 years?

And because an ARM mortage will reset on 12/31/2007 instead of on 01/01/2008 a home owner won't qualify for this assistance?

It all boils down to helping the very well off to keep their properties and forget everyone else who really, really needs help to keep their homes.

Just keep in mind that once again taxpayers money will help the better off and the worst off won't even get the crumbs.

[Double T]

2. Freeze rates for 5 years, THEN WHAT??

5 years allows bushco to make their getaway and then blame the economic and housing disaster on his successor.

[Blackhatjack]

3. Exactly.