A year ago, President Obama introduced a plan that would "keep as many as 9 million people in their homes by lowering their monthly mortgage payments. Not with Treasury Secretary Timothy Geithner saying things like, "You'll start to see the effects quite quickly." However, the president cautioned that the plan wouldn't be able to save all homes. An Associated Press article described the plan:
The numbers show a program that failed to deliver. About 116,000 homeowners have had their loans modified to reduce their monthly payments, the Treasury Department said Wednesday. Only about $15 million in incentive money has been paid to more than 100 participating mortgage companies. That's 0.02 percent of the $75 billion available...
Interviews with officials in the Obama and Bush administrations, bank executives and housing experts show the government launched the effort without thinking through many of the details of such a complex program.
One large problem with Obama's plan was that the mortgage companies were not prepared for the plan. Mike Heid, the co-president of Wells Fargo's mortgage division, said that "The program was announced long before a true program existed". The government is having a hard time tackling such a large an complex issue. It will be difficult trying to find the solution to the housing crisis as house prices continue to fall.
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