Effect of the Barack Obama Foreclosure Program on Homeowners

The crux of he foreclosure avoidance plan of the President is to obtain $75 billion from the funds that have been earmarked by Congress for bailing out the financial services industry and use it instead to combat the rising number of foreclosures.  The three main goals of the Barack Obama foreclosure prevention program are refinancing, more loan modifications, and the provision of more home loans

First, the initiative has the goal of assisting borrowers whose unpaid loans are larger than the prevailing price of their homes to get refinancing and reduce their monthly payments.  To be accepted under this initiative of the Barack Obama foreclosure avoidance program, the loan balance of the homeowner should not be more than 105 percent of the property’s present value.  Meanwhile, the second component is geared towards encouraging the banks to give the go signal for loan modification applications to make the monthly payments more affordable by not exceeding 31 percent of the borrower’s monthly salary.  Lastly, the Barack Obama foreclosure prevention plan has given $200 billion to Freddie Mac and Fannie Mae to allow them to provide more home loans.

The Barack Obama foreclosure prevention initiative, which is better known as the Making Home Affordable Program, has made a slight progress in its attempts to assist borrowers in their efforts to get out of the foreclosure trap in the face of decreasing home values and rising unemployment rates.  According to statistics that have been revealed during the last week of September 2009, the plan of the President appears to be working at last.  Some argue that the Barack Obama foreclosure avoidance plan has been instrumental in the slight improvement in the foreclosure rates in some states and in the fact that home prices have stopped declining in a number of states.  Nevertheless, many people still point out that only a slight percentage of those who should have qualified for home loan modifications have gotten the approval of banks.

Some people disapprove of the Barack Obama foreclosure plan for what they claim is the lack of sound economic foundation.  Nevertheless, the Obama Administration continues to have faith in the program and has been issuing reports on its progress.  The government has proudly reported during the first week of October 2009 that the plan has accomplished a milestone that has been originally projected for the first week of November 2009.  Apparently, the plan’s goal of having more than half a million trial loan modifications approved has become a reality almost one month ahead of projections.  Therefore, it is possible that the Barack Obama foreclosure prevention initiative may finally work after all. To learn more about the foreclosure process stop by http://rismedia.com