Monday, February 16, 2009

Foreclosure FIX-Obama Administration

By: Corey Mutterperl

NEW YORK ( -- A day after Treasury Secretary Tim Geithner said it would be a few weeks before he unveils a solution for the housing crisis, regulators and lawmakers pressed financial institutions to suspend foreclosures until the plan comes out.

Geithner, who laid out a broad overview of the Obama administration's plan to attack the financial meltdown, said Tuesday that the federal government would commit $50 billion to preventing foreclosures by reducing monthly payments. Details would be forthcoming, he said.

Until that loan modification plan is released, foreclosures should be halted, some say.

"I would ask all of you now to please make sure that we have a moratorium in effect," Rep. Barney Frank, D-Mass., told top bank executives at a hearing Wednesday. "It would be until we get that program, and until you know if people can qualify. Having someone suffer foreclosure because two weeks hadn't gone by for this program would be unacceptable."

The chief executives of Bank of America (BAC, Fortune 500) and Citigroup, (C, Fortune 500) two of the nation's largest servicers, told lawmakers they would agree to halt foreclosures temporarily. The head of Wells Fargo (WFC, Fortune 500) said it already has a moratorium in effect for loans serviced by Wachovia, which Wells Fargo acquired last year.

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