Over half a million home owners have been helped out by a government program aimed to aid those facing foreclosure. The program was intended to make sure that the foreclosure crisis remains somewhat maintained, and does not spiral out of control.
However, Elizabeth Warren, chairperson for the Congressional Oversight Panel for the $700 plus billion bailout program says, “We’re concerned that not enough foreclosures will be prevented.”
Unfortunately, it seems as if the plan is falling short in three key areas. First, the people who really need the help are the ones who are not eligible. Making adjustments and aid available to these people may decrease the ever-growing foreclosure filings.
Second, only about 25,000 loans are being modified a week, which is far below (less than half) the amount of foreclosures being filed a week.
Third, so far only 1,700 or so home owners have gotten loan modifications. Most others are still in a trial period, therefore only delaying the inevitable rather than actually helping.
Warren stated that the plan’s timing is misplaced, as it “appears to be targeted at the housing crisis as it existed six months ago rather than as it exists today.”
The housing crisis, although reporting spikes of good news here and there, is still very much alive. Many industry experts believe that the market will “sour” before it gets better. The slow start to this federal program is one inclination of the long road ahead.
“We’re still living with the risk that housing is going to be a source of weakness in the economy,” says Treasury Secretary Timothy Geithner.