New Action Plan for Mortgage Borrower

The Obama administration is expected to come up with a new action plan to control the rate of foreclosures. The plan is expected to include measures to redraw the repayment terms and to convert them to lower monthly installments. This is likely to help the borrowers retain their houses.

According to officials, the new plan will put more pressure on mortgage providers to modify their loans. It is also expected that mortgage providers will be given cash incentives for modifying their loans. Rising foreclosures put negative pressure on the economy by suppressing housing prices.

According to a report released by the Mortgage bankers association, 14% homeowners are either behind in their mortgage payments or are in the process of foreclosure. Treasury’s plan called ‘Home Affordable Modification Plan’ is likely to get a face lift and would now include newer aids like increased number of organizations providing help.