Obama’s Plan Is Struggling
This is because he didn’t account for unemployment.
“Rising unemployment is complicating the Obama administration’s effort to reduce foreclosures and stabilize the housing market.
The Obama foreclosure-prevention plan was “built around the subprime crisis model, not the unemployment crisis model,” said Michael van Zalingen, director of homeownership services for the nonprofit Neighborhood Housing Services of Chicago.
One possibility is a forbearance plan that allows borrowers to hold off from making mortgage payments for several months while they look for work. But there are no specific guidelines for determining who should get forbearance and for how long.
Other options include providing short-term loans to borrowers who have lost jobs, or giving special treatment to borrowers likely to become re-employed soon. Administration officials haven’t taken a position on these options, and said each brings its own challenges.”