Just like a seasoned firefighter who is carefully positioned below a burning building to catch victims, the government's housing arm, the U. S. Department of Housing and Urban Development (HUD), is ready to provide a safety net for those who are on a downward spiral because of their mortgage situation.
Since the start of 2007, we have seen how foreclosures rose and home prices dropped, causing many people to lose their hard-earned homes. Over the past months, the government exerted a lot of effort to make sure that the crisis is managed properly.
There are several housing assistance programs that were made available to help us deal with the current crisis. There are those that offer affordable housing to certain types of people: low-income families, senior citizens, and veterans, easing some of the burden on them.
But there is still a need to address the bigger part of the problem, and that means more comprehensive measures to produce a long-term effect. The Housing and Economy Recovery Act is one step to getting closer to solving the housing crisis. It will help the HUD help more troubled homeowners in saving their homes from foreclosures.
Since last year, there are already 300,000 families who avoided foreclosure and refinanced to more affordable mortgages through the help of HUD. By the end of the year, the department aims to up the numbers to 500,000.
Here are other housing assistance measures designed to help homeowners who are facing mortgage problems:
This was an initiative launched by the president in August 2007. It allows the Federal Housing Administration (FHA) to help low-income families, even minorities, with good credit histories but are experiencing difficulties in keeping up with payments to avoid foreclosure by refinancing to more affordable mortgages. In July of this year, FHA expanded the program to help those with adjustable rate mortgages who can't afford and missed out on three monthly payments over the past 12 months.
Temporary increase in loan limits
From March to December this year, FHA temporarily raised the amount homeowners can borrow to help them buy or refinance to more affordable prices. The new limits range from $271,050 to $729,750.
Increased housing funds
Since 2001, HUD's funds for 2,300 approved housing counseling agencies increased by 150 percent. For 2008, counselors got an approved $50 million while $180 million was given to a non-profit group (NeighborWorks) that helps prevent foreclosure. Another $65 million is requested for next year's budget.
Housing and Economy Recovery Act
Last month, President Bush ended weeks-long deliberations on how to provide solutions for the tormented housing situation by signing into law the Housing and Economy Recovery Act. Its provisions will provide mortgage assistance, incentives for homebuyers, tax deductions, increased loan limits, veteran assistance, community redevelopment grant, new Fannie Mae and Freddie Mac regulator, and financial backup for the two mortgage companies.
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