There are so many plans being floated to stem the subprime crisis and avert foreclosures, it's hard to keep track. A cheat sheet on the major proposals.
The government buys at-risk mortgages from lenders at steep discounts, restructures the loans to reduce payments and resells the loans in secondary markets. Investors in mortgage-backed securities take a loss, but get most of their investment back. Borrowers get refinanced mortgages.
One variation of the plan, proposed by Sen. Chris Dodd, D-Conn., would establish a new agency, modeled after the depression-era Home Ownership Loan Corporation, to buy loans. A similar idea from Rep. Barney Frank, D-Mass., would use an existing entity such as the Federal Housing Administration to do buy loans.
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