Who can pass up one month’s free rent on the place they currently live in? It’s a great deal! I am talking about Bush’s Plan To Put A 30-Day Freeze On Foreclosures. The plan is part “Project Lifeline”.
I talked about “Project Lifeline” yesterday in Project Lifeline: A Lifeline For Who? New details are out today. Here they are:
Dubbed “Project Lifeline,” the new program will be available to people who have taken out all types of mortgages, not just the high-cost subprime loans that have been the focus on previous relief efforts.
The program was put together by six of the nation’s largest financial institutions, which service almost 50 percent of the nation’s mortgages.
These lenders say they will contact homeowners who are 90 or more days overdue on their monthly mortgage payments. They will be given the opportunity to put the foreclosure process on pause for 30 days while the lenders try to work out a way to make the mortgage more affordable to the homeowner.
What A Deal!
Talk to your lender. Get a freeze. Then do what you need to do anyway: walk away. Inquiring minds may wish to consider the Moral Obligations Of Walking Away.
Government response is nearly always counter productive. At great expense, lenders are manning the phone lines to take applications for free rent. In the end people will just end up walking anyway. Meanwhile it is perfectly clear panic is setting in, from Bush, from Paulson, and from the lenders.
In the end, people will do what they’re gonna do: walk. Now it will be with an extra month’s free rent on the side.
Mike “Mish” Shedlock
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