With the Obama Administration's $275 billion housing plan starting early next month, we are wondering here at Home Front if this will lessen the number of people walking away from their homes. The plan has received a lot of criticism in California for only helping people who are less than 5 percent "underwater" - this is having homes that are worth 5 percent less than they owe on the mortgage. In California, millions are now 20, 30 and even 40 percent underwater.
The other part of the plan subsidizes lenders to get monthly payments of struggling borrowers down to 31 percent of their incomes. But that's just the monthly payment, goes the criticism. It won't, for the most part, cut the amount owed - the principal.
So the question is: If you're more than 5 percent underwater and can't get help, and you can't get your principal lowered - what's the incentive to stay with your house?
That leads to my question for a story I am just starting on about the current state of walking away - and whether it might or might not subside given the Obama plan:
Are you thinking about walking away? Have you already done so? I realize this might be the one thing you'd like least to talk about publicly in a newspaper. But we are looking for some people who are willing to be interviewed and quoted by name. If you're game, please call me at 916-321-1102 or send an email to jwasserman@sacbee.com. Thank you.
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