As Democratic lawmakers consider plans for a large-scale, taxpayer-funded rescue of struggling homeowners, the Bush administration is expanding a program that has been criticized for failing to reach enough borrowers.
From the Associated Press:
The plan would enable more low- to moderate-income homeowners to refinance into mortgages with monthly payments they can afford, while lenders would take a loss on the loans.
It is a more modest version of a concept Democrats have been pushing in recent days to respond to the mortgage mess, which would have the Federal Housing Administration back restructured loans for distressed borrowers. The administration's idea, however, would reach far fewer borrowers than the Democrats' proposal and would be financed by homeowners' mortgage insurance premiums rather than taxpayer dollars.
The plan would expand a program, known as FHASecure, that Democrats have argued has done too little for struggling homeowners and doesn't reach the vast majority of distressed borrowers.
Full article here.