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/ Opus#6@AmericanPerspective

    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?