The Administration's New Subprime Mitigation Plan: Take 30 Days To Pack Your Bags

The compassionate conservatives helming our government have an ingeniously simple new plan for homeowners facing foreclosure: take 30 days, pack your bags, and then get the !@#$ out.

Could you too be eligible for this amazing offer? Probably not! Like the Administration’s past efforts, this plan is voluntary and only a handful of lenders have signed up. That won’t stop anyone from trumpeting their false charity.

The mortgage lenders are hailing the extra 30 days as “stopping foreclosures” and giving time to negotiate new loans. But there are no commitments in that rhetoric. Indeed, this is described as valuable for people who are already 90 days in default–and with whom the mortgage servicer didn’t work something out during that time.

The mortgage industry has been ferociously lobbying against changes in the bankruptcy law that would help an estimated 600,000 families refinance their mortgages at 100% of the current market value of the home. This is a solution that will be painful for many families, forcing them into bankruptcy to get some relief. But it is the only game in town right now to help families negotiate a permanent solution without rewarding the high-risk lenders.

Subprime lenders: Working overtime to put the heart in heartless.

Let Them Eat Crumbs [Credit Slips]
(Photo: Getty)