Foreclosure Prevention Tool
As we’ve been talking about for some time now, the incredible fluctuations in variable interest mortgage loans have set off an epidemic of foreclosures across the nation. Various states have attempted to implement emergency measures to stem the rising tide of foreclosures. Now a Federal agency may be stepping in as well.
The Federal Housing Administration (FHA) and President Bush are claiming they have already instituted a program that is the solution to our problems. They claim that FHASecure is the solution, a program that originated last August which allows switching from high interest variable mortgage rates to fixed interest rates. FHASecure was meant to rescue homeowners who have been crushed under the interest of their rising interest rates.
As we mentioned before, mortgage applications are on the rise, which would seem to be a good statistic. However, we mentioned in that short post that these are not your conventional mortgage applications; they are for refinancing. This is corroborated by the fact that foreclosures have doubled in the first quarter of this year, and more than two hundred thousand Americans have been forced to move from their houses this year.
Whether or not this FHA program will end up being a foreclosure prevention tool remains to be seen. It is a certainly a step in the right direction.
