WASHINGTON — Homeowners threatened with foreclosure would in some instances get a 30-day reprieve under an initiative the Bush administration announced Tuesday.
Critics attacked the proposal as far short of what is needed to resolve a serious financial crisis that is threatening millions of families with the loss of their homes.
Under the new program, six of the nation’s largest financial institutions said they will begin contacting homeowners who are 90 or more days overdue on their monthly mortgage payments. The homeowners will be given the opportunity to put the foreclosure process on hold for 30 days while the lenders look for a way to make the mortgage more affordable.
The new program will be available to the holders of all types of mortgages, from prime to subprime. It represents a widening of an initiative announced by President Bush in December that offers a freeze on subprime-mortgage rates that are scheduled to reset to sharply higher rates for borrowers who qualify for the assistance.
30-day freeze
The plan: A 30-day reprieve to allow homeowners to work out refinancing in an attempt to avoid foreclosure.
Reaction: Critics say it doesn’t solve the problem; lenders would not be required to offer more favorable terms.
