The Homeowner Affordability and Stability Plan announced by president Obama’s administration in mid-February is yet another example in this crisis of well-meaning legislation that largely misses the point.
The good thing about it is that it is at least attempting to tackle the root of the problem: mortgages. The bad thing about it is that it is tackling the wrong ones. The $275 billion plan is two pronged: first, it will allow mortgages held or securitized by Freddie Mac and Fannie Mae that do not account for more than 105% of the current value of the property to refinance.
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