What is the government doing to save my home from foreclosure?

Foreclosure statistics are rising daily. Right now it is at its all time high and the housing market is suffering. More than 244,000 foreclosures were filed last year. Many of us are wondering with the rising cost of food, fuel for our cars and the declining income, what are we to do to make this situation better. Better yet, what is the government going to do to help us save our homes? Is there any foreclosure assistance out there?

The government has a couple of plans in motion to help. The problem is who are they helping? It is time they help the families that have been warped into the rise of mortgage rates. As foreclosures continue to grow, it depletes the economic growth. Over the last year home prices fell by 8.9%, while foreclosure rates rose by 60% according to RealtyTrac.

So who exactly is going to get the help?

The first step is to address these situations on an individual step by step process. The National Low Income Housing Coalition states that there has been no attention received for helping low income home owners that are delinquent on their mortgage. This is where the problem lies. These families are the ones that need the help to invest their money into something withstanding.

The president has announced a plan to help homeowners to reduce the numbers of foreclosure. The problem being, who qualifies? In this bill, a lot of factors are taking into account, the size of the mortgage, the type of mortgage, FICO scores. President Bush and Treasury Secretary Henry Paulson have announced their plan of foreclosure assistance to help reduce the number of foreclosures.

Your next questions should be – what does this new plan entail and can I qualify?

The proposed new plan against foreclosures is set to address the issues of many struggling homeowners who have not been able to be reached by housing counselors who have had to monitor each homeowner case to determine whether or not assistance was needed. Now, counselors will be able to more efficiently determine which mortgages need help and what type of help they could use. These counselors can look at a variety of factors like the type of mortgage they have, the size of their mortgage, their FICO scores and their payment history.

1.2 million home owners facing foreclosure can and will qualify.  There will be refinancing loans and reconstructed terms. The other plan is to have a five year freeze on mortgage rates. These plans target ARM mortgages with subprime rates. Fixed rate mortgages must have originated in-between January 1 2005 to July 31 2007 to qualify. Another hole in the plan is the reset needs to have occurred in-between January 1 2008 to July 31 2010. If the rate reset occurres before this time, then you will not qualify. Your loan to value ratio is 97 %, or less than 3% of equity in your home. FICO scores will need to be 660 and has not risen by more than 10% since the starting of your loan.

Another disqualification is if you are currently delinquent on your loan, there will not be time to negotiate a fast solution. If your home is not your primary residence and you are a renter, renters may face immediate eviction. About the only ones this will benefit is those who are current on their loan, have equity in the home, good payment history and FICO scores. The key here is to notify your lender at the first onsite of any trouble in finances.

Hillary Clinton is all for the five year freeze on interest rates, while Barack Obama has proposed a $30 billion in aid with 10 billion of that plan to help local communities fight foreclosure and avoid foreclosure. Both of these presidential candidates support and propose to amend bankruptcy laws to help those facing housing foreclosure. Republicans have voted against this. John McCain is in the process of a plan to help 200,000-400,000 from home foreclosure. There are no details at this time of who will qualify for the help.

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