The Initiative will begin with 3-4 million “at risk” homeowners targeted. These homeowners have loans that are conforming and secured by Fannie Mae and Freddie Mac. The total Initiative’s goal is to help 7-9 million families save their homes. To achieve this Mr. Obama would like lenders to refinance loans or modify loans. In return, the government will give monetary incentives to the lenders as borrowers make payments on time. Additionally, the government intends to incentivize the homeowner for making payments on time.
Affected by the collapse of the housing market are a great many people. Housing lead us into this recession and many hope housing will lead us out. Mr. Obama’s Initiative seems to have that in mind. A major question that you should be considering over the nearly 2 weeks before this Initiative is enacted is: “How does the government define “at risk” or “responsible” homeowners? This will help you identify if you will qualify this Inititaitive.
I would like to close by pointing out two axioms of the real estate industry. First, all markets are local (do not look too closely at the nationwide scope). Second, real estate is a cyclical market. Every homeowner must endure down markets and enjoy up markets.
Stay tuned for more details!
Matt Kemper
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