That’s what I asked when the new FHA Secure Plan was introduced back on August 31st.
This is from the HUD News Release on that date:
President George W. Bush today announced that HUD’s Federal Housing Administration (FHA) will help an estimated $240,000 families avoid foreclosure by enhancing its refinancing program…
The eligibility requirements of the program?
Homeowners must meet the following criteria:
- A history of on-time mortgage payments before the borrower’s teaser rates expired and loans reset;
- Interest rates must have or will reset between June 2005 and December 2008;
- Three percent cash or equity in the home;
- A sustained history of employment; and
- Sufficient income to make the mortgage payment.
I remember thinking to myself, “sure they make it sound like a great program and they’re showing that the government is being active. After all, there are some good households, rightful home owners, that deserve the opportunity to refinance out of their recasting loan programs and into something a bit more secure/affordable.
BUT…and it’s a big but…in accordance with the eligibility criteria, I asked:
How many home owners will we REALLY be able to help?
You know what my answer was?
That’s right…a dismal two-hundred and sixty-six! Here’s the statistic straight from Reuters:
Between September and mid-December, only 266 such borrowers have cleared all FHA hurdles, according to data compiled by the Department of Housing and Urban Development that was provided to Reuters.
FHA Director Brian Montgomery said the program was off to a slow start but is overcoming bureaucratic challenges and gaining momentum even as the national mortgage crisis worsens.
Slow start huh? I’ll say! 266 isn’t a number any of us were hoping for. I remember Realtors calling to ask if their clients fit the program and previously denied borrowers asking if they could refinance now. FHA Secure seemed like their savior. Clearly we still have a ways to go in this correcting market.
*Note: Additional reports reflect the number to be at 33,000. Still, I don’t think this is the number we were hoping for.
And what of the FHA Modernization Bill? It’s still bogged down in the Senate undergoing deliberation for changes and such.
Now go read Morgan’s post; he phrases it all so eloquently!