Did Homeowner Affordability and Stability Plan Lure Families Into Default Or Foreclosure?
On January 4th, 2010 the Illinois Family Institute (IFI) posted an exclusive report titled: Obama Administration’s“Homeowner Affordability and Stability Plan” Actually Putting Homeowners In Default or Foreclosure. This month NBC 5 Chicago will run a series of special reports conducted by consumer affairs reporter Lisa Parker which will look into the mortgage foreclosure crisis facing thousands of Illinois residents and millions of homeowners across the nation.
IFI’s investigation exposed how the Homeowner Affordability and Stability Plan may have lured unsuspecting Illinois mortgage holders into default or foreclosure regarding a seemingly well-intentioned program. A central Illinois couple from Eureka –who were not in arrears on their mortgage payments–applied for and were accepted into a program funded through the $787 billion stimulus package titled the American Recovery and Reinvestment Act of 2009.
The American Recovery and Reinvestment Act was, in part, designed to lower interest rates for homeowners who were in over their heads related to mortgages approved and insured by Fannie Mae and Freddie Mac, due to these quasi-privately owned companies which provided loans to many homeowners whose income should not have qualified them for mortgage loans. Many economists believe the Fannie Mae and Freddie Mac crisis has led to the current deep recession America now finds itself in.
The IFI investigation revealed that some homeowners–who were not behind on their mortgages–were enrolled in the Homeowner Affordability and Stability Plan, only months later to be informed that they did not in fact qualify for mortgage relief. After lenders agreed to accept lower payments, this family from Eureka –and possibly hundreds of others–were told that they should have known they did not qualify for the program, and their mortgage holders were now demanding reimbursement for the “shortfall” in their lower adjusted mortgage payments until the “shortfall” was paid back. Subsequently, this failure in the administration of the Homeowner Affordability and Stability Plan led some homeowners who were not originally into jeopardy of losing their homes into default or foreclosure.
NBC 5 Chicago will also delve into the overall housing crisis facing Americans which has led to an estimated one out of every five homes being in default of foreclosure.
“The Housing Crisis: Dreams Denied”
During the month of March, NBC 5 Chicago takes a multi-faceted look at the housing crisis currently plaguing a growing number of Chicagoans, and millions of Americans overall. Target 5’s Lisa Parker will continue her in-depth coverage of the homeowners struggling with the delays and denials of a banking system they say is not answering the call for help. NBCCHICAGO.COM will offer ongoing access to resources for homeowners fighting to keep their property. Finally, NBC5 will wrap up the month with a live call-in and e-mail panel featuring a range of housing industry professionals in-studio to give advice and insight.
“We are continuing to hear from viewers whose lives have been shattered because of the housing crisis,” said Frank Whittaker, Station Manager/Vice President of News, NBC 5 Chicago. “Our series will look at some of the new issues that have arisen, and we will provide our viewers with important information they need to protect themselves. We believe the issue is so critical that we will devote an afternoon of our newscasts on March 24th to helping our viewers find answers to their problems.”
There had been national reports regarding problems with the Homeowner Affordability and Stability Plan. But after the Illinois Family Institute’s Exclusive Report on January 4th detailed specifics concerning how lenders had not put these mortgage adjustments in writing and then later rescinded the offer of lower interest rates to some mortgage holders, demanding repayment (for the difference of their original mortgage payment and the adjustments they received after being informed they qualified for the program), Lisa Parker’s investigation and other media reports have led to formal clarification of those who do qualify for mortgage relief and the expansion of the Homeowner Affordability and Stability Plan. Though details are still not clear regarding who does and does not qualify for this program, in at least some cases mortgage lenders have been willing to renegotiate original agreements made to homeowners who found themselves in jeopardy of default or foreclosure after being accepted into the Homeowner Affordability and Stability Plan.
The reports will air on NBC 5 Chicago (WMAQ-TV) on Wednesday, March 10th at 10 P.M. (repeated the next day at 5 P.M.), and on Wednesday, March 17th at 10 P.M. (repeated the next day at 5 P.M.). The series will conclude on Wednesday, March 24th, with an afternoon of reports and interviews in the 4:30, 5 and 6 P.M. newscasts which will include a phone bank of experts where viewers can call in to ask questions.
The interview with the family from Eureka , Illinois will be broadcast in Chicagoland. However, other NBC owned affiliates may chose to broadcast the series in other areas across the state.
