Department of Housing and Urban Development makes changes to Hope for Homeowners plan aimed at increasing participation.
By Les Christie, CNNMoney.com staff writer
NEW YORK (CNNMoney.com) — The Bush administration said Wednesday that it was changing its nearly-moribund mortgage rescue plan in an effort to spark more lenders and homeowners to participate.
The Department of Housing and Urban Development’s Hope for Homeowners mortgage rescue plan, which Congress toiled over for months before passing legislation last summer, took effect Oct. 1.
The program aimed to help hundreds of thousands of homeowners by putting up government insurance behind cheaper, refinanced mortgages, for people at risk of foreclosure.
But since then, few troubled mortgage loans have been modified under the plan. Now, in an effort to kick start it, HUD is trying to open up the program to more homeowners.
“Clearly, meaningful changes were needed,” said HUD Secretary Steve Preston. “These modifications should increase lender participation and help more families who are having difficulty paying their existing mortgages, but can afford a new affordable loan insured by HUD’s Federal Housing Administration.”