Less Help For Homeowners
The bailout recovery law granted President Obama $700 billion to stabilize the nation’s financial situation. Of that, he promised $50 billion towards helping modest homeowners avoid foreclosure.
Now, after first reducing it to $22 billion the actual amount to be spent on helping homeowners will be just $12 billion according to the nonpartisan Congressional Budget Office (CBO). Are homeowners being forgotten?
Unemployment is around 10 percent. Banks and corporations are back in profit, the economy is beginning to grow again and Wall Street is safe. But, employment is barely rising and foreclosure is still a big problem, so what about the ordinary man or woman on Main Street?
In 2008 Obama believed three to four million homeowners were in danger of foreclosure. The $50 billion Troubled Asset Relief Program was supposed to help avoid this. It was also supposed to help punish mortgage companies who broke the law.
The program has helped some homeowners. 483,000 have been making reduced payments as part of the plan. However, 755,000 have lost their homes for a variety of reasons, not all their own fault. Not a single mortgage lender has been punished for breaking the law, including my misleading customers.
By the end of October the government had spent just $750 million of that $50 billion pot of gold. Yet, nearly 25 percent of homeowners owe more debt for their house than the house itself is worth.
While the program could not fix all the problems for American homeowners it is clear that it has not even begun to make a meaningful impact on their lives. But hey, at least Wall Street, the banks and those misleading mortgage lenders are safe.
Photo courtesy of Avvo.