TREASURY PLANS

The Treasury plans that the U.S.government announced on November 30th to help homeowners avoid foreclosure, is multi-faceted:

*lenders and borrowers completing Short Sales are eligible for incentives.
* documentation necessary for Short Sales are streamlined and simplified.
*It limits the ability of subordinate lien-holders to obstruct the Short Sales process.
* time taken by lenders to approve or reject Short Sales requests is limitized
All neceary steps for creating pressure on lenders to make permanent the 650,000 trial loan modifications they started earlier in 2009.
75 Percent of Borrowers Potentially Fall Under the Plan. This plan is a part of the Foreclosure Alternatives Program, that could potentially apply to 75 percent of all mortgages in the U.S. Loans held by Fannie Mae and Freddie Mac, which back about half of all mortgages, currently do not fall under the guidelines. However, both organizations are working with the Treasury Department to finalize applicable servicing guides.

Objective



Several assistance programs exist under Section 8. Together, the voucher and certificate programs help more than 1.4 million households in the United States. The administering PHA or governmental agency inspects the housing units to make sure they comply with HUD quality standards. The voucher program is similar to the Section 8 certificate program but gives households more choices, especially in high-demand markets where landlords may be reluctant to accept HUD's .



Assistance



Under the plan, borrowers who complete a Short Sale are released from all mortgage debt. Additionally, they receive $1,500 for moving expenses. The plan provides for payments of $1,000 to mortgage services and investors for completing a Short Sale - or a deed-in-lieu transaction, in which the deed is simply turned over to the lender.

Short Sales Time limit



Lenders will have only 10 days to approve or reject a Short Sale - a significant step, since the process often takes so long to complete that the transaction falls through. Borrowers will be allowed at least 90 days to market and sell their home, with the possibility of additional time based on local market conditions. Marketing can run at the same time as the foreclosure process, but no foreclosure can take place during the marketing period as long as the borrower is acting in good faith to sell the property..