Not everyone was a winner under the program to help troubled homeowners announced Wednesday by the Obama administration.
The refinancing plan does nothing for people whose mortgages have dropped substantially in value because it’s limited to borrowers who owe no more than 5 percent more than their home’s current value. Borrowers who are severely underwater don’t qualify.
It also won’t help borrowers whose main breadwinner has lost a job or those who are drowning in other debts on top of their mortgages.
The ineligible borrowers are concentrated in California, Florida, Nevada and Arizona, but are also in the Midwest, particularly in Detroit.
“This is not going to save every person’s home,” said Robert Gibbs, the White House press secretary. “The plan is not intended to … augment somebody’s loan for a house that they couldn’t afford under any economic situation, good or bad.”
Source: The Associated Press, Alan Zibel