August 30, 2010
2 New Federal Programs to Help Borrowers Pay Their Mortgages
By BLOOMBERG NEWS
The Obama administration plans to take two new steps in the next few weeks to help struggling homeowners pay their mortgages, said Shaun Donovan, the secretary of Housing and Urban Development.
The administration will begin a Federal Housing Administration refinancing effort to help borrowers who are struggling to pay their home mortgages, and will start an emergency homeowners’ loan program for unemployed borrowers so they can stay in their homes, Mr. Donovan said on “State of the Union” on CNN.
“We are going to continue to make sure folks have access to home ownership,” he said.
Home prices fell 1.6 percent in the second quarter from a year earlier as record foreclosures added to the inventory of properties for sale. The annual drop followed a 3.2 percent decline in the first quarter, the Federal Housing Finance Agency said last week in a report.
Sales of new homes unexpectedly dropped in July to the lowest level on record, signaling that even with cheaper prices and reduced borrowing costs the housing market is retreating. Purchases fell 12 percent from June to an annual pace of 276,0000, the weakest since the data began, in 1963.
Mr. Donovan said that it was too soon to say whether the administration’s $8,000 tax credit for first-time home buyers, which expired April 30, would be revived.
Reviving the tax credit would “help enormously” in the effort to fight foreclosures and revive the economy, Gov. Charlie Crist of Florida said on the same CNN program. Florida has one of the highest home foreclosure rates in the country, with one in every 171 Florida housing units receiving a foreclosure filing this year.
This article has been revised to reflect the following correction:
Correction: August 30, 2010
An earlier version of this article incorrectly rendered the name of the Federal Housing Administration as the Federal Housing Authority. |
