California Government Fights Against Foreclosures
An article published by Loan Workout gives details on the California government’s plans to actively fight the rise in foreclosures- which rate in California is twice the national average. According to the article:
- With California impacted more than any other state by the national home foreclosure crisis, Governor Arnold Schwarzenegger worked with loan servicers from Countrywide, GMAC, Litton and HomeEq to agree to streamline “fast-track” procedures to help keep more subprime borrowers in their homes. Together these four enterprises service more than 25 percent of issued subprime mortgage loans.
- “With this type of cooperation from loan servicers, we can save tens of thousands of people from being added to the foreclosure lists. This common-sense approach does not involve a government subsidy or bailout,” said Governor Schwarzenegger. “Borrowers need to do their part too. If these lenders are willing to meet more than halfway, it’s important that consumers don’t run when they reach out. It was a two-way street that got us into this mess and it will be a two-way street that gets us out.”
- The Governor will also continue to lobby Congress to raise federal loan limits so that more California families can take advantage of these secure products, rather than relying on subprime loans.
It is good to see government officials working to find solutions for the crisis at hand. That is, after all, what we elect and pay them to do. I particularly like the fact that Governor Schwarzenegger is going to make borrowers and lenders alike work to get themselves out of this mess. All the government is going to do is make sure that both parties are giving and receiving what they should be. In a time like this, I think that is exactly what role the government should be filling. Sometimes borrowers just need to figure things out themselves, with options such as home equity lines of credit always viable alternatives.
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