Washington (AP) The Bush Administration, trying to deal with a worsening housing slump, is announcing a new initiative that is aimed at helping homeowners about to lose their homes. For qualified homeowners, it will put the foreclosure process on hold for 30 days.
The new program is called Project Lifeline. It will be available to people who have taken out all types of mortgages, not just the high-cost subprime loans that have been the focus on previous relief efforts.
The program was put together by six of the nation's largest financial institutions. These lenders say they will contact homeowners who are 90 or more days overdue on their monthly mortgage payments. They will be given the opportunity to put the foreclosure process on pause for 30 days while the lenders try to work out a way to make the mortgage more affordable to the homeowner.
Consumer groups are skeptical. They claim many borrowers still can't keep up with payments even after loan workouts. The groups claim a full-fledged refinancing at a lower rate would be better for borrowers.