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Frank Warns Lending Industry not to Oppose New Foreclosure Assistance Legislation
By kevin | May 7, 2008
US Financial Chairman Barney Frank warned lenders Monday that the new legislation proposed before the House that would require lenders to trim down the debt owed by some homeowners in danger of foreclosure so that refinanced loans for those borrowers could be sponsored by the federal government was their last chance to help the housing crisis before the government imposed tougher legislation that could hurt lenders severely.
Frank warned that new standards and rules would be imposed that would make it harder for the lending industry to provide loans. The Financial Committee of which Frank is chairman approved a proposed $300 billion program that would provide funds for the federal government to refinance homeowner loans in danger of foreclosure. The house is expected to sign the bill into action as early as next week, but its success hinges on mortgage lenders going along with the need for them to knock off partial debts on some loans. The argument is that now that property values are so low, the homes do not need to be under the inflated values for which they were bought in past years. This implies some blame on the housing industry for contributing to these inflated values through providing loans and subprime mortgages so readily in past years.
Topics: Foreclosure |