New York Times: FHASecure Misses Troubled Homeowners
May 5th, 2008
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The New York Times has reported what we have been saying here for months: The FHASecure program is a dud:
“Fewer than 2,000 homeowners at risk of foreclosure have been helped by a Federal Housing Administration program that President Bush promised would help homeowners who had fallen behind on their mortgage payments, federal housing statistics show,” said the Times.
“FHA officials have asserted in recent weeks that more than 150,000 people have benefited from the program, which was intended to help troubled homeowners refinance into stable, government-issued loans. But the vast majority of participants have been homeowners who have made their mortgage payments on time, not the borrowers in crisis who were the targets of the president’s plan, the statistics show.
“Housing officials, who initially expected that 60,000 or more delinquent borrowers would benefit, say they greatly overestimated the demand from troubled homeowners.”
Does anyone believe the last paragraph? How can there possibly be a shortage of borrower demand for federal assistance when the foreclosure rate is soaring?
Foreclosure activity, says RealtyTrac.com, involved 649,917 properties during the first quarter of 2008 — that’s up 112 percent from the same period in 2007.
As reported earlier by FHALoanPros.com, the Times says that “from October 2007 through the end of March, only 1,729 delinquent mortgages were refinanced by F.H.A., housing statistics show.” The Times also adds that “officials project that 4,000 such mortgages will be refinanced by the end of September.”
Only 4,000 distressed conventional borrowers will be helped in a year? What about the rest of those who are losing their homes? Or some portion of the rest? Or maybe just borrowers with last names that begin with the letter “L” — pick any letter you like.
We have been reporting for months that HUD claims of assistance to those facing foreclosure are inflated beyond either recognition or common sense. The Times has caught on, hopefully the public will be next.
For the full Times story, see: Federal Mortgage Plan Falls Short, Critics Say
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