The HOPE for Homeowners program was authorized by the Economic and Housing Recovery Act of 2008. Since the President signed this vital legislation into law on July 30, 2008, the HOPE for Homeowners Board of Directors has worked diligently to develop and implement the program as directed by Congress. The Board was charged with establishing underwriting standards to ensure borrowers, after any write-down in principal, have a reasonable ability to repay their new FHA-insured mortgage.
The HOPE for Homeowners program begins today and ends September 30, 2011. The program is available only to owner occupants and will offer 30-year fixed rate mortgages - so the borrower's last payment will be the same as the first payment. In many cases, to avoid what would be an even costlier foreclosure, banks will have to write down the existing mortgage to 90 percent of the new appraised value of the home.
<smip>
The borrower must agree to share with FHA both the equity created at the beginning of this new mortgage and any future appreciation in the value of the home.
<snip>
If the home is sold or refinanced, the homeowner will share the equity with FHA on a sliding scale ranging from a 100 percent FHA share after the first year to a minimum of 50 percent after five years. The lien holder that previously held the highest priority will receive payment up to a proportion of its original interest, not to exceed the amount of available appreciation. This type of delayed payoff will take place until all prior lien holders are satisfied or the amount of available appreciation is exhausted. All remaining appreciation is remitted to FHA.
<snip>
http://www.hud.gov/news/release.cfm?content=pr08-150.cf...
Bush Administration Launches "Hope for Homeowners" Program
by SixofNine 3 Replies latest jw friends
-
SixofNine
-
LDH
I swear to god, I thought this was going to be a clip from The Onion.
-
SixofNine
heh, you cynic you.
.
At first read, this looks like the kind of program that can help establish a "floor" for the main-street economy.
-
daniel-p
And thus the continued subsidy of the nation's housing. What makes homeowners so automatically worthy of government assistance?