New Agreement Could Mean More Help for Homeowners

By MICHAEL R. CRITTENDEN

June 16, 2008 2:59 p.m.

WASHINGTON -- Top mortgage lenders and servicers,
under pressure to do more to help prevent record numbers of
foreclosures, have reached a major agreement on new guidelines to
improve and speed up the industry's voluntary efforts to help
struggling homeowners.

The agreement among the firms in the Treasury
Department-backed Hope Now alliance, which is scheduled to be announced
Tuesday, comes as U.S. Senate lawmakers prepare to begin debate this
week on a massive housing package aimed at slowing the record pace of
foreclosures that continues to roil the economy. That legislation,
which includes a program to refinance up to $300 billion in troubled
mortgages, could be voted on by the Senate this week, sources said.

The Hope Now agreement pledges to have lenders and
servicers take a uniform approach when dealing with homeowners,
including setting a specific timeline for them to respond to borrowers
seeking to avoid foreclosure.

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"Borrowers seeking help should receive an
acknowledgment of their request within five business days once received
by the lender, the agreement says, and would in most cases receive a
final decision on whether they will receive help with their loan within
45 days. Lenders would also promise to stay in touch with borrowers
while reviewing a particular loan -- calling, emailing or sending a
letter about the status of their help request"

Lenders and servicers have also agreed to other steps,
including the automatic subordination of second liens in certain
circumstances. The question of how to deal with second lien holders has
slowed efforts to modify loans and work with borrowers, but the
servicers' agreement suggests that a second lien holder should
re-subordinate their loans to allow refinancing or a loan modification
under certain conditions.

The agreement expands other options available to
lenders to help borrowers avoid foreclosure. In addition to
forbearance, repayment plans and loan modifications -- including a
writedown on a loan's principle -- the agreement directs lenders to
accept a deed in lieu of foreclosure or a short sale instead of
completing the foreclosure process.

The short-sale language is new, and pledges Hope Now
members to accommodate a homeowner's effort to sell their house at the
current fair market value, even if that value is less than the borrower
owes on their mortgage.

More generally, the agreement calls on servicers to
delay foreclosure proceedings that are about to begin, or have already
begun, when there is a possibility that other steps could allow a
homeowner to remain in their residence.

People familiar with the agreement, which all Hope Now
members had to sign off on, said the intent is to bring clarity and
transparency to the alliance's efforts, giving homeowners a better
understanding when they seek help with their loans. Though not legally
binding, all Hope Now participants are expected to implement the new
uniform standards within 60 days.

Hope Now claims its efforts have resulted in nearly
1.6 million loan workouts since July 2007, though those numbers have
been met with skepticism from policymakers and regulators who have
repeatedly called for more aggressive voluntary efforts by the mortgage
industry.

A report released last week by the Office of the
Comptroller of the Currency, which oversees national banks, suggested a
lower figure for loan workouts. The study, which was based on six
months of data from 23 million mortgages held or serviced by nine
national banks, found that there had been close to 167,000 loan
modifications or payment plans through March of this year.

Meanwhile, foreclosures around the country continue to
show few signs of abating. Foreclosure tracking firm RealtyTrac Inc.
said Friday that one in every 483 U.S. households received a
foreclosure filing in May, the highest monthly foreclosure rate since
the firm first started issuing its report in January 2005.

Write to Michael R. Crittenden at michael.crittenden@dowjones.com

One might want to take a closer look at the hi-lighted paragraph before getting all warm and fuzzy. It's still seems to me that the BANK is ultimately in control of whether you get any help and the decision is solely theirs to make. . . I'll pass on that foo.

The only thing being pumped is you. . . . .

By JOE BEL BRUNO

NEW YORK (AP) - Wall Street rebounded sharply Tuesday after the Federal Reserve and other central banks said they will pump $200 billion into the financial markets to help ease the strain from the credit crisis. The Dow Jones industrials surged more than 270 points.

The program is part of a worldwide effort to help struggling banks and mortgage providers. The Fed - acting in concert with the European Central Bank, the Bank of Canada and the Swiss National Bank - agreed to loan banks money in exchange for debt that includes slumping mortgage-backed securities.

The Fed's latest move was seen as a direct boost to struggling banks by avoiding having to dramatically slash interest rates when the central bank's policymaking Open Market Committee meets next week. Economists continued to be concerned about the unrelenting rise in oil prices and the dollar's weakness, which contribute to inflation - and cutting rates only add to these pressures.

"The big problem has been the financials, and this helps supply money directly to the banks and may take some of the need for aggressive rate cutting off the table," said Peter Dunay, chief investment strategist at Meridian Equity Partners. "The Fed is basically going to take the bad loans off the banks' books, and the market seems to be loving that idea."

Well there you have it! Your government hard at work once again it give it to right in the ass. Why not give that money to the people who were screwed by these same banks? Yes let's give it to the same guys who live large on the backs of the little. What a great idea this was oh and guess who will wind up paying for it in the end. You!

You think they'd give it to the people to help pay their loans

WASHINGTON (AP) — The Federal Reserve is taking bigger steps to ease the nation's credit crisis, including increasing the amount of loans it plans to make available to banks this month to $100 billion.

The Federal Reserve announced Friday that it will boost the size of auctions planned for March 10 and March 24 to $50 billion each. That is up from the $30 billion limits it had previously announced. The auctions serve as short-term loans to get banks the cash they need to keep lending to their customers.

The Fed, in a statement, said it planned to continue the auctions for at least six months, and would move to even larger auction amounts if needed.

In a second step, the Fed said it will make $100 billion available to a broad range of financial players through a series of separate transactions starting on Friday.

The Fed has been working to pump billions of dollars into the banking system to aid an economy rocked by the subprime mortgage crisis and the severe tightening of credit. The central bank started its new type of auction in December to provide short-term loans to cash-strapped banks in hopes of keeping them lending. So far, the Fed has made available a total of $160 billion in short-term loans to banks through six auctions.

Fears are growing that the country is teetering on the edge of a recession, if one has not already begun.

The picture worsened just after the Fed's announcement Friday when the Labor Department released a report showing employers slashed another 63,000 jobs in February, the most in five years.

Senior Federal Reserve officials said the steps announced Friday were geared to providing relief to credit markets, which have deteriorated further in recent days, and not related to the weak employment figures.

A meltdown in the housing and credit markets has made banks and other financial institutions reluctant to lend to each other, causing a cash crunch. Financial companies wracked up multibillion-dollar losses as investments in mortgage-backed securities soured with the housing market's bust. Problems first started in the market for subprime mortgages— those made to people with blemished credit histories. However, troubles have spread to other areas.