Obama To Extend Assistance To Jobless Homeowners
STEVE INSKEEP, host:
In an online town hall this week, President Obama was asked about mistakes he'd made handling the economy. He pointed to housing.
President BARACK OBAMA: We've had to revamp our housing program several times to try to help people stay in their homes and try to start lifting home values up.
INSKEEP: Yesterday, the president's administration announced yet another revamp. It's extending assistance to homeowners who've lost their jobs.
NPR's Tamara Keith has more.
TAMARA KEITH: If an unemployed homeowner can't pay the mortgage, one option to avoid foreclosure is a forbearance - a temporary reprieve granted by the lender while the homeowner searches for work. But some 45 percent of the unemployed have been out of work for six months or longer and the standard forbearance doesn't last that long, just three or four months.
Pastor LUCY KOLI (PICO National Network): It really didn't give enough time for people to put something else together.
KEITH: Pastor Lucy Kolin is with the PICO National Network, and has been pushing to have more help extended to unemployed homeowners. The program change announced yesterday would extend the forbearance period for some borrowers to a year.
Pastor KOLI: It's one positive step in breaking that link in the United States right now between losing your job and losing your home.
KEITH: But the reach of this initiative is somewhat limited. The one-year forbearance will only be required for Federal Housing Administration loans.
Bob Ryan is the acting commissioner of the FHA.
Mr. BOB RYAN (Acting Commissioner, Federal Housing Administration): The right thing to do for borrowers. And we think it's the right thing to do for the economy, and so therefore, we certainly are encouraging others to adopt this as a standard and move forward.
KEITH: For lenders handling conventional loans, the extended forbearance is merely an option. Fannie Mae and Freddie Mac are huge players in this market and their regulator isn't commenting on whether or not they'll participate.
Tamara Keith, NPR News, Washington.
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