Obama Forces Mortgage Companies to Give Unemployed Americans 12 Months Free Rent

It’s an Obama world…
The Obama Administration will require mortgage companies to offer 12 months of forbearance for qualified unemployed borrowers.
The Wall Street Journal reported:

The Obama administration will require mortgage companies to extend more generous mortgage relief to help certain unemployed borrowers from losing their homes to foreclosure.

Under policy changes announced Thursday, mortgage companies that collect payments on loans backed by the Federal Housing Administration will be required to offer 12 months of forbearance for qualified unemployed borrowers. Currently, out-of-work borrowers with these loans can receive a minimum of four months without mortgage payments.

Firms that participate in the Obama administration’s Home Affordable Modification Program will also be pressed to offer up to 12 months of forbearance for unemployed borrowers, though that effort could be stymied by regulatory or contractual rules.

Housing officials said the changes could help tens of thousands of borrowers. Housing Secretary Shaun Donovan said he hoped it would “push the mortgage industry” to amend their offerings.

The foreclosure crisis was initially driven by adjustable-rate mortgages that were resetting to sharply higher payments, but over the past three years, far more homeowners have faced foreclosure because they have lost their jobs or seen their income fall. Many of those borrowers can’t easily sell their homes if they get in trouble because they owe more than the properties are now worth.

Officials said the change was prompted by a slow economic recovery that has seen longer stretches of unemployment than in past downturns.

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  • Ma

    This will make the housing crisis worse and much longer in length not to mention what it will do the mortgage lenders and those looking to obtain a mortgage.

  • dwd

    Anything to buy more votes.

  • bigkahuna

    I would love to get Obigears at a press event and ask /demand that he let me move into the Whitehouse for a year or so until he is voted out. Hey we all need to sacrifice and give right ?

    I would also like to say Hey on these tax hikes since Democrats want to continue raising taxes I say we raise the taxes just on Democrats and reduce taxes on Conservatives.

    That would please everyone right ?

  • Skandia Recluse

    Obama forces banks to let the unemployed live in their (mortgaged) homes without payment, and Social Security recipients will not get their monthly stipend unless the GOP agrees to raise the US debt limit.

    So if Obama stops Social Security checks, can senior citizens continue to live in their homes without having to pay their mortgages? What will that do to the banks who hold those mortgages?

  • chris

    One of the most ridiculous memes is that adjustable rate mortgages caused the problem. During the last 3 years, we have had indices that are 1%, or below. You have to be a frigin idiot to think that low rates off of which the adjustable is set is causing bankruptcies.
    FRAUD, FRAUD AND MORE FRAUD

  • http://www.sonoranalliance.com wanumba

    SO how are banks supposed to make money? Does this mean they’ll just foreclose and throw people out? Is the governemnt looking to be Big Landlord, taking up forclosed properties by the millions?
    How does the government intervene in the middle of a legal contract and change the terms?
    Constitutional?

  • http://www.sonoranalliance.com wanumba

    Think of all those low-interest loans backed by the gov they’ve been pushing all over the place. What happens when one refinances a private loan for a gov-loan and then the gov is suddenly telling you can’t do this or that with the property?

  • Patricia

    Wouldn’t be better to create jobs so people can pay mortgages and other bills?
    once “some people” get used to a free rent, maybe they will get used to that kind of lazy life and refuse to look for jobs after the 12 months of free rent.

  • MrGoodWench

    Free houses for everybody…isn’t that what all this is about ?
    How else could these people have owned houses?
    Now all Obama needs to do is put gas in their cars, he has paid their mortgage

  • Toast n Roast

    HOPE, oh please let there be hope that this miserable POS we have for President will himself receive free rent, room and board in Leavenworth for 20-life!

  • jorgen

    I thought bribing the electorate was illegal?

  • MrGoodWench

    Under policy changes announced Thursday, mortgage companies ……….will be required to offer 12 months of forbearance for qualified unemployed borrowers. Currently, out-of-work borrowers with these loans can receive a minimum of four months without mortgage payments.
    ++++++++++++++++
    From each according to their ability
    To each according to their needs
    (Now where have we heard that?)
    :(

  • http://mainfo.blogspot.com/ [email protected]

    How indeed can Obama walk in and change bank mortgage contracts? Oh, through bribery. They will be booted out of Federal mortgage programs if they don’t cooperate.

    Gangster Government, just like Bachmann said.

  • kato

    I’d like to know the racial makeup of the subprime crowd.

    I’d bet money that most of the subprimers who got zero-down loans with no proof of employment or income are black. And they’ll get to live for free in these houses for two or three years — It takes well over a year to evict someone — and then they’ll get some new government handout.

    They’re not among the unfortunate who bought homes and then lost their jobs as Blowhard would argue. They’re the permanent parisitocracy who simply don’t work because it’s easier to collect Obama Money.

  • Got Billy Ayers on Speed Dial

    Cash for Clunkers redux

  • Alana

    ” . . . though that effort could be stymied by regulatory or contractual rules”

    I don’t see what that would stop Obama. Rules? Laws?

    Didn’t stand in the way of overlooking the people first in line for the Chrysler thing in favor of unions, did it?

    I don’t notice rules or laws or much of anything ever standing in the way whenever Obama says “make it so.”

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  • Guy in Ohio

    I’m sure glad I’m not in the mortgage banking industry … there’s nothing like having the government running your business for you …

  • The Triguy

    Kato,
    It’s not the racial makeup of the group: Check for the Union Label! They will be the ones who get this round of governemnt largese so the Dems can keep their votes. Remember, there are more and more Dem Tea Party people out there. The Unions and Barry both know that this has to stop or their hopes of taking over the country are lost!

  • Molon Labe

    Maybe I’m missing something but what happens to the banks that don’t go along with the Big Zero?

  • tigerbythetail

    NO.no, no ! The scam continues at the expense of responsible taxpayers. Enough is enough!

  • smalltowngirl

    Pretty soon mortgage companies will only offer conventional loans, also, I wonder if they can try to sell the gov. loans they are already holding.

  • Scott

    The oft repeated cover story “the housing crisis was sparked by adjustable rate mortgages resetting to higher prices.” All the adjustable rate indexes have been going down commensurate with the T-bill and Libor…Rates have never been lower. The housing crisis was created by the criminal negligence of Fannie Mae, the government’s affirmative action mortgage company. Fannie Mae sets the standards by which 99% of mortgage loans are written. When fannie authorized no-doc, liar loans, it set off a chain reaction whereby millions of junk loans were written to people who should have never gotten a loan. The rest of us have to pay for these junk loans. Every responsible citizen in America has been damaged by the criminal behavior of the Federal government. The Federal government is the engine of destruction for our Republic…

  • Scott

    The housing crisis was sparked by democrat vote buying…Affirmative action housing brought to you by Fannie Mae, and facilitated by Barney Frank and Chris Dodd. Clintonites Jamie Gorelick and Rahm Emmanuel sat on the Fannie Mae and Freddie Mac boards of directors, respectively…Of course, Jamie Gorelick is famous for having blocked intelligence sharing between the FBI and CIA which made it easier for the 9-11 hijackers to fall through the cracks in our intelligence networks. And, of course Rahm went on to work for the first communist President as his chief of staff…What were political appointees with no knowledge of banking or housing doing sitting on the boards at the government backed mortgage companies that were underwriting 99% of mortgages? The recklessness of the Federal government nearly bankrupted these United States. Every one of us have been damaged by their criminal behavior.

  • Scott

    #14 Kato,

    Considering that Las Vegas, California and South Florida were hardest hit by foreclosures, we would have to conclude that democrats were buying votes from illegal and legal immigrants as well as other democrat voting blocks.

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  • squeaky

    while putting the damage this would/could cause aside – this is how entitlements get started. a feel good program that ends up being much like quick sand as advocates and their armies push to extend the 12 months beyond that time frame. when self sufficiency takes a back seat to government freebies. it’s interesting listening to folks who will tell you that all they need is a job and if only [yada yada yada] but then dismiss the available jobs as being less than what they get for free. their champagne taste on a beer budget. and ot but maybe a gunrunner part deux maybe?
    [Breaking News: Tampa SAC ‘in full meltdown…shredders are buzzing’]
    http://www.examiner.com/gun-rights-in-national/breaking-news-tampa-sac-full-meltdown-shredders-are-buzzing

  • Bob

    All you folks who bought houses you could afford, didn’t use them as cash registers during the boom, faithfully paid the monthly mortgage payment and knew that if you fell on hard times there was no guarantee that you wouldn’t lose the house have, like me, got to feel like absolute fools.

    Well, line up for the next round of feeling like a fool. We now get to pay for the cost of this new “benefit” from the great O. Me, I’m about ready to quit paying my mortgage and let the government take care of me. Just hope there are still enough people who haven’t decided to do the same so I can freeload on their dime.

  • GrayRider

    So let me get this straight. Not only has Obummer screwed up the housing market and the economy, he now wants to screw both up even worse. Can November 2012 come soon enough?

  • Low Sloped Forehead

    Trickle up poverty.

    Spread the misery.

  • JPL17

    “Wouldn’t be better to create jobs so people can pay mortgages and other bills?”

    Yes it would be, unless your goal were to make citizens entirely dependent on the federal government…which seems to be Obama’s goal exactly!

  • squeaky

    what is the vacancy rate of homes – i read 13%. every now and then i come across someone making the argument that joe schmo moving in to one of these vacant homes is really a good thing for the neighborhood. wondering if joe would get a free house in the end as the former owners of the home [the pureoutoflucker’s] find themselves in a shelter or under a bridge. it seems that there’s an empty house in chicago that could be made into a shelter.

  • Jerry C

    Owning a home: The biggest scam by the U.S. Federal Reserve bank(rupt) government.

  • #1AMERICAN

    spread the wealth…robin hood obummer at it again

  • WSG

    Note to administration: When you were reading your instruction manual, Wesley Mouch was not supposed to be considered the guy who was doing the right thing.

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  • Andreas K.

    Nanny state, nothing else.

    Usually, if you lose your job, you go to your bank and talk with them about it and both parties will find a solution. It’s in the interest of the bank as well, because they don’t want to be stuck with yet another house to sell.

    This is load of BS.

  • Gary

    Scott#24
    You said just what I was gonna say. Here we go again.
    But one thing, I think the correct term is Clintonistas.

  • Paddy

    Re #11: De Tocqueville said that American democracy would end when the government learned how to bribe citizens with their own money. Our government has succeeded beyond De Tocqueville’s wildest image. They bribe all of those who pay no taxes with tax receipts from those who do. His image was formed several decades before Marx wrote Das Kapital. As a nation we are near the end unless the Democrats lose control of both houses of Congress and the presidency in 2012.

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  • HOWARD

    do you know what forbearance means? it’s not free rent, it’s moving the payments that can’t be made to the end of the loan…it is a thing of value, but it isn’t free rent

  • what color uniform will you wear?

    Pick out your socialist uniforms boys. Bow down to musobama. Everyday it’s a new f***kup with this dude. Is there one, just one guy willing to stand up and say “I voted for this m****y and I am so f***king sorry I did it” . No national day of prayer but musobama had a prayer day for the musims at the White House. I am so weary of this crisis, crisis, crisis. He has got to go. I got a call from the DNC yesterday about him. I think they are weighing their options. Trouble is they only asked me if I would vote for Romney. Press one for likely. They did ask me if I would vote for O. There was no option for “are you f&$%ing kidding me?”