President Obama Plans to Help Distressed Homeowners

November 6th, 2008

President Obama Plans to Help Distressed Homeowners
After the sweeping victory of Barack Obama in the US presidential election, people are expecting a positive change in the real estate. The problem of US home foreclosure has left a devastating mark in the real estate market. The homeowners are at a real stake. President Obama has several plans to get done with this problem of foreclosures that have put the housing industry into a major crisis situation. People who are facing the brunt of foreclosure are just looking up to him and his plans. Obama has a number of economic plans up his sleeves that would help the distressed homeowners. He together with Biden aims at providing necessary information to the borrowers. Also, they aim at providing tax relief to the mortgage holders.

Obama has got four important elements in his foreclosure fighting plan. He aims at letting the bankruptcy court judges to bring an adjustment in the payments of mortgage for those who are compelled to declare their personal bankruptcy. This will provide some space to the distressed homeowners to work out on their current debt. Obama believes that this plan of his will aid the courts in protecting the borrowers from the lenders who practice deceptive lending. Obama also have plans to introduce a program called HOME. Home stands for Homeowner Obligation Made Explicit. This will help in creating a “real” APR that will be based on fees and also the total costs associated with borrowing of home loan.

Obama even aims at an increase in the regulation of the sub prime mortgage industry. He has proposed for a Stop Fraud Act. Stern actions will be taken by the federal government against the lenders if they practice deceptive lending. They have to undergo very strict penalties if they are found fraud.

Apart from the above plan of fighting with foreclosure, Obama also is looking towards a tax benefit for the mortgage holders. As of now, a large number of homeowners qualify for a tax aid. However, they fail to benefit as they have not listed their deductions. Seeing this, Obama has planned to offer a very simplified tax credit to them that will let the distressed families get a tax relief of thousands of dollars. This will be especially beneficial for those who won’t hire an accountant for helping out with tax returns. Even it will benefit those who have been unable to get tax benefits due to a complex tax code.