Love it or hate it, the Obama Administration’s $275-billion effort to ameliorate the foreclosure crisis offers a sizeable amount of gritty detail, doesn’t attempt to rescue everybody, and has a realistic tone. The banking sector seems content enough, with American Bankers Association svp and COO Diane Casey-Landry describing the Homeowner Affordability and Stability Plan as a “constructive, flexible and multifaceted initiative likely to have a positive effect on preventing mortgage foreclosures.”
The Mortgage Bankers Association expressed similar enthusiasm: “We are encouraged by this effort that will provide a variety of alternatives to help a wide array of borrowers,” noted John A Courson MBA president and CEO, and MBA chairman David G. Kittle in a joint statement. But the group has reservations about the scope of the help. “Among the concerns we have is that it seems to offer little help to borrowers whose loan exceeds their property value by more than five percent,” the statement continued. “This will limit the plan’s success in some of the hardest hit areas in California, Florida, Nevada and Arizona, as well as some of areas on the East Coast,” Kittle and Courson cautioned.