WASHINGTON, DC - With the Obama administration's housing plan underway for modifying mortgages for distressed borrowers, Citigroup, Morgan Stanley, JPMorgan Chase, and Goldman Sachs are stalling foreclosures on a few home loans, for a roughly three-week interim period.
Even Wells Fargo all the home loans it owns - including some it inherited from Wachovia and was already not foreclosing - to a standstill.
The government plan, aimed at providing housing relief, removing illiquid assets, and prompting lending, is scheduled to be summarized by President Obama on Wednesday, during his trip to Phoenix, Arizona. Earlier, in his proposal to soothe the financial system, Treasury Secretary Timothy Geithner announced $50 billion aid to "prevent avoidable foreclosures" of middle-class owner-occupied homes.
It was at the House Financial Services Committee hearing on February 11 that the Committee Chairman Barney Frank asked the CEOs of leading banks to halt foreclosures till Geithner's plan comes through. The Office of Thrift Supervision also advised savings-and-loans to defer foreclosures till a plan is complete.
Agreeing to stall foreclosures, JPMorgan CEO Jamie Dimon wrote to Frank: "Three weeks is adequate time for the Treasury to announce - and for us to implement - a new plan. We stand ready to work with you to put the appropriate process in place, including a national modification standard."
Source: AllHeadlineNews.com