JP Morgan Steps Up to the Housing Rescue Plate
JP Morgan is stepping up to the housing rescue plate. The company has its own plan for loan modification, and it has been working on helping those at risk for foreclosure work through their problems and get a payment they can afford, hopefully warding off foreclosure. And, as the bank unveils its new plan, it is instituting a 90 moratorium on foreclosure so that the new program can be put into place. CNN Money reports on the plan from JP Morgan:
JP Morgan Chase expects to help 400,000 families keep their homes during the next two years by working out $70 billion worth of loans. The company says its housing rescue efforts have already helped 250,000 families holding about $40 billion in loans. …
Chase’s program will apply to all the loans owned directly by the bank. But Chase also acts as a mortgage servicer for loans owned by investors. Servicers are the companies that manage the everyday business of collecting payments and sending out bills. It is servicers that borrowers must contend with when they fall behind in payments, and the servicers who determine what help can or will be offered. …
The bank will seek authority from investors to apply its foreclosure prevention plan to the loans that investors own, according to spokeswoman Christine Holevas. “We’ll try to reach out to investors to do the same thing for their homeowners,” she said, “but this is very complicated.”
This is a rather ambitious plan, something that a lot of thought has been put into (unlike the $700 billion government bailout “plan”). Indeed, this is probably one of the most ambitious plans out there that has hope of working, and it will be interesting to see if others follow suit.
Something needs to be done by private entities, since right now our mortgage and housing market — along with the economy — is basically being propped up by the government. And while the government is useful when it enforces sensible regulations, for the most part, it’s best if the government mostly stays out of the business of keeping the markets running.
Tags: JP Morgan housing rescue, housing rescue, home mortgage loan, mortgage loan blog,
$700 billion bailout, foreclosure, economy
November 11th, 2008 at 2:49 pm
[…] Veterans’ Day comes as many mortgage lenders (including Citi and JP Morgan) come to the realization that all these foreclosures and problems are going to hurt their bottom […]