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Welcome back we'll keep track -- relief of national foreclosure report tomorrow -- the numbers are not expected to be pretty.
With foreclosures rising US Department of Housing and Urban Development is launching a new education campaign today.
It's called the home -- here which aimed to help families prevent foreclosure.
This -- on the heels of president elect Obama's nominee for housing secretary Shaun Donovan.
-- -- offended during his confirmation hearings that he will launch an impressive response in the foreclosure crisis when he takes office.
It tell us what Heidi is doing and what can do in the mortgage and -- I'm joined now by -- current secretary.
Housing and urban development Steve Preston good to see -- -- So after the second -- -- to keep your home knowing your loan you're releasing this today when he trying to do what hasn't -- Well we.
States have shown all our information shown that when people get to housing counselor it's very helpful helpful for them to figure out how to get their financial house in order.
What their options are they need -- restructure their way out.
So last year we expanded our funny for counseling up to 400 million dollars this is one more campaign to tell people if think you're gonna have a challenge get to housing counselor call 877 -- 1515.
And we can get to touch of the housing counselor in your area.
I'm curious you've taken a lot of heat for the fact that.
The perception -- this administration has not done enough to address housing.
There have been things like the hope now alliance there -- been -- -- -- -- 500 dollar tax credit which actually turned out to be a long term loan.
Out when they're getting multiple.
Different programs that they created over the past year but it's sort of hard to make heads or tails of which ones are really weren't yet sure what's working what's it like okay couple.
These are working first of all and hide.
-- FHA insurance we have refinanced over 500000 people last year.
Many people are coming out of these sub prime mortgages were putting him to thirty year fixed rate mortgages for the first payment to same -- the last.
Number -- -- the thing that is working is the mortgage market is working.
We hear -- business credit not really working but the federal government is supporting about 90% of the new mortgages and our country.
Our volume and high is up over five times in the last two years for mortgages coming through us.
People can get mortgage credit today at a cheaper rate than they have in decades of -- qualify it.
So those are very important programs that are working.
-- let me ask you this one of the reasons.
It's interesting because we know that the Federal Reserve Bank has been in the air and and announced that they're gonna purchase mortgage backed securities and be involved in the commercial paper market which will of course help interest rates -- has already started to do.
One the other things that was put into effect under President Bush was the increase in the size of the conforming loan under Fannie and Freddie up to 700 I think -- 2729000.
That expired as of December 21 and we're back down to that need 400000.
And what many people -- things that jumbled mortgage rates are so much higher.
Then rates in the conforming loans with which you guys help refinance don't need to do something to address.
Well did -- the -- actually back up to 625 -- and that's that's the permanently right now congress is looking at taking it up into the 729 range again.
Having -- higher level has been very important because markets like California.
Las Vegas tourism markets we really haven't been able to help homeowners and those markets because our low level for so well so now we're back in the game.
And a lot of people are coming to us for that mortgage help because we're in the game.
And I think -- -- five limit for everywhere across the country -- go to speaking to a homeowner Boston the other day was having a real problem trying to get it now I hear people -- or doing to loans to try to get within at least the 400000 dollar conforming.
It's based on the the way it said it's based on the price of the market so it's different for different markets and that set based on.
Pricing standards in this in this metropolitan areas you know Shaun -- is gonna come over take the job he's guidance.
Huge job ahead -- And he's pretty aggressively things can go out there and fight his head is a little -- didn't talk to lie to turn this story around the first of all I think Sean is a very qualified.
Person for the role he's got good experience he actually was at home and and I have spent a lot of time with them.
I I do think there's an opportunity here from -- Targeted foreclosure prevention activities.
But the first thing I'd say is we have to continue to do we're doing to keep mortgage capital life.
Through FHA through Fannie -- through Freddie Mac Freddie Mac that is an important part of people buying new homes and getting refinancings.
The other thing is there a lot of programs out there under consideration right now we have to make sure that -- program gets passed is gonna work.
Lot of times things -- great in the drawing board but when you actually pass them.
They really aren't people don't use them for one reason or another they're too complicated or too expensive.
Well I think that's been part of an issue right now is it's just hard to make heads or tails of all been programs have been announced to me.
As you very well know the FDIC chair Sheila Bair has been getting a lot of applause for what she was successfully able to do with indymac.
You know that's been one form there's been the Treasury Secretary talking about another one you know it just appears as though there's all these -- how you start to create.
From synthesis here.
With indymac is a very important example because what what by the FDIC said -- indymac is what it's more expensive to file close -- home and actually make alone affordable.
Make no mistake a bank does not want to own your home because it cost a lot of money for them.
And manage it.
So financial institutions have a strong incentive to actually modify loans and unfortunately even though we've seen a lot of progress in the private sector.
We have not seen enough progress to really break the logjam a part of this is because the people who send you your bills every month and talk -- you are not actually the investors who -- -- Servicers and investors need to come together more aggressively.
I'm concerned that some of our potential federal plans would be writing checks to investors to do things that they should be doing on their round.
And I think the lodge in between those two groups has to be broke okay let's talk about.
That because that is the number one issue that people are talking about right now particularly as it relates to the second half of the TARP funds is a great deal of frustration that we gave a lot of money to a lot of financial institutions.
Who many of which hold those mortgages and don't just service then they haven't done anything to me.
Mortgage affordability or -- pollution better know that like Citigroup has been talking about with bankruptcy judges.
What do we if we tap into that 350 billion dollars some of which is used toward loss mitigation what do you think works.
Well I think there're couple things that could work.
And in once again I don't want to diminish the fact I think the private sector is the first place we should look to take care of this issue.
These are the same people that are getting hundreds of billions of dollars from the federal government want to make sure that they're doing the job to help homeowners.
But secondly I think there are ways that we can support I mean the TARP money has not been used to buy mortgages.
There are mechanisms where they can buy mortgages.
From banks the government can modify those mortgages and make them affordable to people.
In their ways that they can buy those at a discount to pay for that program so it doesn't have a huge impact on the taxpayer.
Since I think -- number of good ideas out there but once again I think we have to make sure that whatever we implement.
Is actually workable.
-- -- wrapping up on a very difficult job but it ended next.
-- they take some time to think about the next thing and I'm not gonna jump -- anything quickly.
I told Shaun Donovan.
You know I'm open for the support and any time I've told the legislators on the hill many of them and asked to talk to me after the job is finished.
We all want everyone to be successful and I think my successor is is very well tool for the job.
Terrific secretary of housing and urban development suppressed and.
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