The Federal Housing Administration recently told lenders who controlled mortgages it backed that they must offer 12 months of forbearance to qualified borrowers who are currently unemployed, according to the Department of Housing and Urban Development. A similar rule may also be applied to those institutions participating in the Home Affordable Modification Program in the near future, but there could be some regulatory and contractual roadblocks involved.
“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,” President Barack Obama said at a town hall event earlier this week.
It’s expected that the policy changes will affect as many as tens of thousands of borrowers currently struggling with unemployment, the report said. In a recent speech, the Secretary of Housing said that the hope for these changes was that they would entice the mortgage industry to change some of its offerings to make them more affordable.
In the past, many foreclosure assistance efforts have been criticized by public interest groups for being too difficult to qualify for.
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