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Smell the Fear

American Mortgage Lenders Help Out Borrowers

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BBC news

"US Treasury Secretary Henry Paulson says that a coalition of counsellors, mortgage firms and trade organisations will offer help to homeowners.

The Hope Now initiative will involve 11 of the largest US mortgage providers, representing 60% of home loans.

The goal of the project is to help borrowers before they become so behind in their payments that the loss of their homes is inevitable.

Mr Paulson did not pledge any extra federal money for the initiative.

He said that he expects it to be largely funded by the private sector, although there is a bill currently going through the House of Representatives that would provide an extra $200m (£98m) of foreclosure prevention funding.

The American Securitization Forum, which represents many mortgage investors, said its members would reimburse counselling fees if the advice would help preserve the loan and prevent a foreclosure.

Mr Paulson recognised that the combination of falling house prices and mortgages that had started at low rates and were now much more expensive was "creating real challenges" for homeowners. "

You couldn't make it up.

No doubt Gordon will cotton on to this and offer cognitive behavioural therapy to UK debt victims as a means of curing the credit boom hangover.

The number of counsellors required will be so large that it haul the country out of trouble by it's bootstraps. Shares in shrink's couch manufacturers are set to go through the roof.

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Thanks STF, another good find. This is another fantastic piece of spin indeed worthy of our own Gordon Brown.

Given there is no federal funding to support this what are the banks going to do? Lower interst rates on defaulting home buyers loans and raise rates for everyone else borrowing new money to cover the margin? Go ahead punks make our day.

The more of these statements that are released, the more is shows how big a sh*tstorm is coming. They have no ideas of how to get out of this.



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The aim of this is to squeeze a bit more out of these poor bods before they loose their homes, ie the lenders will get a bit more back before selling them out for a loss. Suspect counciling will involve, sell your car, sell your TV and the kids toys and give the money to your nice lender, then see if your parents, inlaws, siblings etc can conjur up some more cash and we might let you stay in the house. ( well this month anyway)

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