Industry News

Interest rate freeze not a done deal

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The Bush administration's latest plan to prevent foreclosures -- persuading lenders to freeze the introductory interest rates on some adjustable-rate mortgages -- remains a work in progress, as disagreements remain over who will be eligible for streamlined loan modifications and refinancings, Treasury Secretary Henry Paulson said today. The plan envisions members of an administration-backed HOPE NOW coalition -- including mortgage servicers, counselors and investors -- will work together to contact borrowers facing interest rate resets, and provide relief for many who are facing foreclosure.  Paulson said that since forming in October, members of the HOPE NOW coalition have achieved a goal of contacting borrowers 120 days in advance of a mortgage reset. Some borrowers facing interest rate resets may be able to avoid higher monthly payments by refinancing into a new loan. The current negotiations are focused on how to help borrowers who don't qualify for a new loan, but who have ...