Foreclosure prevention plan draws mixed reviews

The response by Denver experts to President Barack Obama’s foreclosure prevention program ran the gamut, with some deriding it and others praising it. Some also believed that it needs to be fine-tuned.

In fact, the $275 billion housing program, announced Wednesday, includes cutting mortgage payments for as many as 9 million under pressure homeowners and expanding Fannie Mae’s and Freddie Mac’s roles in shortening foreclosures.

Fairly openly, the more the government meddles with this, the poorer they are going to make this. This thought was of Ron Woodcock, a broker with RE/MAX Southeast.

In fact, rather than an enormous rescue the solution is a better financial system with higher-paying jobs.

But really, Mike Rosser, a longtime mortgage broker who is also co-chairman of the state’s foreclosure task force, said the Obama plan seems “workable.”

Rosser also stated that he knows that there is a “moral hazard” in helping homeowners who are either in or facing foreclosure, when about 90 percent of the people are paying their mortgages exactly on time.

Rosser also expressed that the reality is what this does is stabilize neighborhoods, allowing people to keep their homes and is also protecting people current on their payments by putting a floor under house prices.

He also added that what we have got to do is triage these problem loans and start moving to help people. In fact, the idea is that if the person recognizes the lender then he is going to lose 25 percent to 40 percent on every property when it is liquidated as a foreclosure, the person will have to inspire them to lose less by modifying loans and other measures to keep people in their homes.

Possessor of Megastar Financial Anita Padilla-Fitzgerald is one of the largest privately held mortgage bankers in Denver, doesn’t like loan modifications, though she also approves of other parts of the suggestion.

Padilla-Fitzgerald has founded a group called American Citizens for Economic Stabilization, which proposes alternatives such as allowing the government to make available second mortgages and build up banks’ balance sheets by getting bad loans off the books.

Sarah Hayes of Colorado Investors Real Estate/Metro Brokers also expressed that she thinks banks should have been modifying loans for homeowners in trouble years ago. Moreover, she is also annoyed about the fact that Obama’s plan appears to subsidize bank losses on bank loans.

She also expressed in such wordings “We’re going to pay the banks that got us into this mess?”. This expression really expresses about the feelings and view.

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