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Mortgage Investors Support H4H

The Mortgage Investors Coalition (MIC) issued a statement this week commending the efforts of the House and Senate in formulating changes to the Hope for Homeowners (H4H) program.
The organization said the revisions made to the program will allow for more homeowners to obtain permanent, low-cost, fixed-rate home financing and pledged the investment community's full support for the initiative. MIC also said its members advocate the creation of a task force to administer and implement the new program in order to provide immediate relief to homeowners facing foreclosure.
The Obama administration has already announced plans to incorporate H4H into the Making Home Affordable plan as a means of providing assistance to those homeowners that are underwater on their mortgages and may not qualify for other foreclosure relief programs due to plummeting home values. Changes to the program to make it more accessible to homeowners and more attractive to lenders include lower fees, streamlined borrower certification requirements, and incentive payments to servicers and originators for participation in the program.
Both congressional chambers' bills addressing the HUD program (S.896 and H.R. 1106) have been approved by their respective assemblies. Senators say they tailored their version so that the two can be easily reconciled and the new H4H program can be quickly put into action.
According to MIC, mortgage investors are committed to working with Congress and the administration to tangibly reduce the principal of troubled homeowners' mortgages. The coalition says that if this pledge is matched by a similar commitment from the banks in regards to second liens, H4H can yield measurable results in keeping people in their homes.
MIC added that non-bank investors believe the administration has devised an equitable method of modifying both first and second liens under the Making Home Affordable program. ""We therefore call on the banks to join with investors in accepting those same guidelines for the Hope for Homeowners program and help homeowners obtain affordable permanent refinancing where they have a better chance of rebuilding the equity in their home,"" MIC said in a statement to the press.
""It is time for the non-bank investors, banks, and servicers to come together with the Congress to advocate what is in the best interests of the homeowner,"" the coalition continued, adding that the H4H program work is the best avenue for keeping borrowers in their homes for both the short- and long-term.
The coalition cautioned that even though non-bank investors are willing to accept the reduction of the principal of the first lien mortgage, absent a willingness of the banks to accept similar adjustments of their second lien positions, the Hope for Homeowners program will not work.
""We remain concerned that the large banks are incentivized and now have immunity to increase the value of their own second lien holdings at the expense of the homeowner and the investors (including pension funds and foundations) who own the first mortgages,"" MIC stated.
The coalition noted that large banks have recently been allocated an additional $9.9 billion to modify mortgages, free from legal backlash under the safe harbor provision included in the H4H bill.

About Author: Carrie Bay

Carrie Bay is a freelance writer for DS News and its sister publication MReport. She served as online editor for DSNews.com from 2008 through 2011. Prior to joining DS News and the Five Star organization, she managed public relations, marketing, and media relations initiatives for several B2B companies in the financial services, technology, and telecommunications industries. She also wrote for retail and nonprofit organizations upon graduating from Texas A&M University with degrees in journalism and English.
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