Project Life Line: A Plan to Help Delinquent Borrowers
The Bush Administration is instituting a new plan to help homeowners who are facing foreclosures. The new plan, called Project Life Line, will affect a great deal of borrowers that are in danger of losing their homes.
The plan specifically addresses every homeowner who has been delinquent 90 days or more. The Treasury Department, and the Department of Housing and Urban Development are announcing this morning. Serious delinquencies headed for foreclosure will be paused for 30 days so that borrowers can communicate with lenders to work out more affordable payment terms. All foreclosure activity for these homeowners will be 
suspended for a month, including all stages of foreclosure.
Mortgages held by six major chain banks are already a part of Project Life Line. These are Bank of America Corp., Citigroup Inc., Countrywide Financial Corp., JPMorgan Chase & Co., Washington Mutual Inc. and Wells Fargo & Co. Other lenders will hopefully become involved in the plan as well.
This plan will affect a broader base of home owners that last year’s Hope Now plan. There was a series of criterion that had to be met to qualify for the assistance program. With the new Project Life Line plan, anyone who has defaulted 90 days or more qualifies.
Home prices have been falling and those who borrowed against their equity expecting to sell or refinance now owe more than the worth of their homes. Even those individuals will excellent credit ratings are struggling with high payments. Many adjustable-rate mortgages set up low payment plans for the beginning of repayment, but require higher payments down the line. Since home values have gone down, refinancing would come up short of what borrowers in these situations now owe, and payments still tend to be unmanageable.
With this foreclosure freeze, many borrowers that are in trouble will hopefully be able to work out affordable plans or refinance their mortgages so that they can keep their homes. The six major lenders will be very busy for the next month, as the Project Life Line plan appeals to a broad base of homeowners at this point. Combined with rate cuts and the new fiscal stimulus plan, the rapid increase in the number of foreclosures may slow down. The combination of these positive moves is a step in the right direction.
February 21st, 2008 at 3:45 pm
I need HELP!. My husband died and I have 2 mortgages. BOA is my first and Greentree is 2nd. Yes, I understand they want interest for doing loan but I have one income now. If they would put two back at a 30 year fixed my payments would be about what they are now with Escrows with BOA. Please help me otherwise I have to leave my home. For 10 years we have paid great until my husband died and now I have one income with 2 mortgages. I don’t make enough to hold on anymore. I’ve used my retirement and all I have trying to stay since my husband died May, 2006. Why want someone help me. I have tried everywhere. I have made this a beautiful place and it will sell for $135,000 + on the market. It is a doublewide with 2.5 acres, but has been upgaded like a house. Has a fixed foundation and is built out of 2×4’s instead of 2×3’s. This is my home. Now if I can not get help I will have to rent for $800 a month and that just overwhelms me. You would think with 10 years paid someone would help me. Now, my mother is sick. She had a heart attack again and they found the same kind of Cancer my husband had. With losing my husband and now not long with my mother, and about to have to move I am beside myself. YOU know I’ll lose 10 years to refinance into a fixed 30 year again, but that’s ok it beats losing my home. Please understand I want to stay where I am. I have put a lot into the landscaping and planted trees, shrubs, etc. It is beautiful and if you saw it you would try to help me to stay. I just can’t deal with the two mortgages adding up to approximately $1400 dollars. That is all I have to live on. I have to have gas to get to work, a little grocery, utilities. I don’t owe anything else but a small medial bill. We did file Chapt. 7 when my husband got Cancer but was Discharged about 4 years ago. I am just trying to make a living and survive. Please help me. Why can’t BOA and Greentree get together and resolve my problem. Please help me. I have tried so hard to refinance and everyone turns me down. It just is not right. I can afford to keep my place if I can just get payments where I can afford otherwise I will have to walk away.
February 21st, 2008 at 3:48 pm
If this life line support works it is a great thing, due to people losing their homes. Even the retirees are going into Foreclosure, this is not the American Way. The Govenment can help, we help all other people in other countries, Why not our own?