UPDATE: Obama announced his plan this afternoon and while Jaimie Dimon called it elegant on CNBC, we have our doubts.
- Here are some questions and answers on Obama’s plan.
- It appears as though the plan created a government sponsored adjustable rate mortgage plan.
- 25% of non-government mortgages go delinquent.
- In other housing news, housing starts edged closer to zero. (A goof thing.)
We’ll have to wait until 12:15 for the official word, when Obama unveils his housing “fix” in Phoenix, but early reports suggest that there’s a little something in there for everyone.
- Banks will be asked to lower payments for those on the verge of foreclosure. The gov’t will split the losses.
- Homeowners who are in good standing, but underwater, may be eligible to refinancing and principle reduction.
- Fannie and Freddie’s arsenal will be doubled from $200 billion to $400 billion in order to reduce mortgage payments.
- Altogether, plan hopes to help 4-5 million families on the verge of foreclosure, and another 3-4 million families who are underwater on their homes.
- Renters get: zilch.
More details as we get them in.