February 12, 2008
CBS 3

3 On Your Side: Mortgage Mess Rescue

By Jim Donovan

There is more help for homeowners struggling to keep their houses and avoid foreclosure. The federal government announced today a new program for those seriously behind in their payments. This new plan is appropriately being called Project Lifeline. It applies to seriously delinquent homeowners, whose mortgages are 90 days or more past due.

Housing and Urban Development Secretary Alphonso Jackson says "this program is not only available for sub prime borrowers but people with any kind of home mortgage." Project Lifeline will allow for seriously overdue homeowners to suspend foreclosures for 30 days while lenders try to work out more affordable loan terms.

For John Dodds at the Philadelphia Unemployment Project it's better late than never. "We really need the mortgage companies to step up and modify these loans to make them affordable and we need them to do it in large numbers," says Dodds.

Project Lifeline will involve six big lenders; Bank of America, Citigroup, Countrywide Financial, JP Morgan Chase, and Wells Fargo.

According to Dodds, "It's in the interest of everybody, including the mortgage companies, including the stock market to not let these properties go into foreclosure, to not have these families put out of their homes."

Lenders will soon be sending letters to homeowners who might qualify for the new program. Homeowners won't qualify if they have entered bankruptcy, if they already have a foreclosure date within 30 days, or if the home loan was taken out to cover an investment property or a vacation home.

If you are having problems making your mortgage payments these organizations may be able to assist you:

LINKS:

www.acorn.org (ACORN)