The Bush Administration keeps attempting half-fast solutions to a fast-moving problem: foreclosures. The latest is Project Lifeline, a voluntary agreement by six big lenders to consider granting 30-day grace periods on foreclosure proceedings against people who are 90 days or more delinquent on their mortgages. Here’s what Treasury Secretary Henry Paulson (pictured) said about it on Tuesday.
The extra month is supposed to give time to work out a loan modification, but there’s no assurance that it will make any real difference.
Sen. Richard Durbin of Illinois, a member of the Democratic leadership, dissed Project Lifeline, according to an article in CQ Today:
“Homeowners at risk of foreclosure are floating 50 feet from shore while Project Lifeline throws them a 30-foot rope. We need a plan that goes further.”
The six lenders, by the way, account for about half of mortgages. They are Bank of America, Citigroup, Countrywide Finance, JPMorgan Chase, Washington Mutual, and Wells Fargo.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.