| GOVERNMENT UNVEILS PLAN TO SHRINK SOME HOME LOANS
WASHINGTON – After months of
criticism that it hasn't done enough to prevent foreclosures, the Obama
administration is announcing a plan to reduce the amount some troubled
borrowers owe on their home loans.
The multifaceted effort will let people who owe more on their mortgages than
their properties are worth get new loans backed by the Federal
Housing Administration, a government agency
that insures home loans against default.
That would be funded by $14 billion from the administration's existing $75
billion foreclosure-prevention program. In addition, their existing mortgage
companies will be able to receive incentives to lower their principal balances.
The program also includes assistance to help unemployed homeowners keep
paying their mortgages.
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