Two Reasons I am Optimistic about the Economic Stimulus Package

After hearing about the different housing programs in the media, I really didn't think I'd see much change. It 's been two years of "we're gonna fix it" and frankly, I am a bit more than cynical. All the media hoopla hasn't amounted to much.

I was pleasantly surprised this week when I ran across it the first time, I was shocked. And the second time....I actually got a little optimistic about the economy!

First off, here's a blurb to get you up to speed:

HOUSING RESCUE PROGRAM DETAILS RELEASED

WASHINGTON (RISMedia, New York Times, Associated Press) – President Obama earlier this week unveiled details of his home loan aid plan designed to help millions of Americans who are at risk of losing their homes.

Administration officials say the Homeowner Affordability and Stability Plan could help nearly nine million households restructure or refinance their mortgages to avoid foreclosure.

The plan includes a $75 billion homeowner stability initiative that targets at-risk homeowners, many of whom have adjustable-rate mortgages that have increased house payments to as much as 50 percent of their monthly incomes.

This initiative offers cash incentives to lenders and borrowers for working out loan modification agreements that result in lower monthly mortgage payments and allow homeowners to keep their homes. Any bank that receives federal money under the Treasury Department’s $700 billion financial rescue program will be required to take part.

Another component of the plan is intended to help as many as five million responsible homeowners who took out conforming loans owned or guaranteed by Fannie Mae or Freddie Mac to refinance through those institutions.

To finance that effort, the Treasury is providing the two companies with up to $200 billion in capital on top of $200 billion that it had already pledged to them.

“This is not going to save every person’s home,” said White House spokesman Robert Gibbs. “The plan is not intended to . . . augment somebody’s loan for a house that they couldn’t afford under any economic situation, good or bad.”

According to the latest data from the Mortgage Bankers Association, nearly 12 percent of homeowners — a record 5.4 million — were at least one month late or in foreclosure at the end of last year.
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The first thing I heard was over a nice pinot at Crush on Friday night. One of my running buddies works at GMAC. She's been tasked with understanding the guidelines so GMAC can help their clients fit within the programs. With $1,000 incentive per successful loan mod, there is a lot of money at stake!

Secondly, I work with a company that contacts borrowers that are in default. I am the one that knocks on their door and asks if there is a way to work things out. We have strict guidelines, ie; we are considered debt collectors, etc. Friday, I got three new assignments. They are all potential loan mods. They are for people that have ALREADY LOST THEIR HOMES! Our goal is to re-instate them! WOW!

I am not a big Obama fan. The debt we are going into makes me worry. However, I am in the trenches, or front steps, with people that are stressed to the edge with worry over losing their houses. Without a place to call home, it's a scary world out there.

After 45 years of living full on red. I might just be getting a little purple tinge on some of my rough edges.

My Texas friends will just shrug it off; "She's from California, after all"