Stimulus Plan

SEQ CHAPTER \h \r 1 Mortgage Stimulus Plan Thesis Statement

The purpose of the proposed research is to examine and discuss mortgage initiatives under the most recent economic stimulus plan . It is the consensus of economists , legislators , and industry professionals that mortgage defaults and foreclosures at the crux of the current economic crisis . As a result , the current administration and congress have built upon previous initiatives to solve the mortgage problem This focuses on the loan modification initiatives of the Homeowner Affordability and Stability Plan

The Homeowner Affordability and Stability Plan

(HASP ) does not provide adequate support and incentive to non government mortgage servicers in a manner that will sustain economic recovery in the housing and mortgage sector . One of the primary objectives of HASP is to reduce monthly mortgage payments to sustainable levels through the process of loan modification . HASP provides different levels of support and incentive to government sponsored enterprises (GSEs ) such as Fannie Mae and Freddie Mac . However , incentives and support for private loan servicers under HASP are not sufficient to encourage and sustain their commitment to long term loan modifications

This will examine the loan modification provisions under HASP comparing the differences in incentives for GSEs and private servicers The first section will discuss the components of the loan modification initiative . The second section will discuss the risks that private servicers face when implementing loan modifications , including the risk of re-default and investor litigation . The final section will discuss the limitations of HASP...