THE WHITE HOUSE

Washington:
Homeowner Affordability and Stability Plan
Fact Sheet
The deep contraction in the economy and in the housing market has created devastating
consequences for homeowners and communities throughout the country. Millions of responsible
families who make their monthly payments and fulfill their obligations have seen their property
values fall, and are now unable to refinance to lower mortgage rates. Meanwhile, millions of
workers have lost their jobs or had their hours cut, and are now struggling to stay current on their
mortgage payments. As a result, as many as 6 million families are expected to face foreclosure in
the next several years, with millions more struggling to stay current on their payments.
The present crisis is real, but temporary. As home prices fall, demand for housing will increase,
and conditions will ultimately find a new balance. Yet in the absence of decisive action, we risk
an intensifying spiral in which lenders foreclose, pushing home prices still lower, reducing the
value of household savings, and making it harder for all families to refinance. In some studies,
foreclosure on a home has been found to reduce the prices of nearby homes by as much as 9
percent – creating the potential that even borrowers who make every payment suffer from an
increase in foreclosures in their community.
The Obama Administration’s Homeowner Affordability and Stability Plan will offer assistance to
as many as 7 to 9 million homeowners making a good-faith effort to stay current on their
mortgage payments, while attempting to prevent the destructive impact of foreclosures on
families and communities. It will not provide money to speculators, and it will target support to
the working homeowners who have made every possible effort to stay current on their mortgage
payments. Just as the American Recovery and Reinvestment Act works to save or create several
million new jobs and the Financial Stability Plan works to get credit flowing, the Homeowner
Affordability and Stability Plan will support a recovery in the housing market and ensure that
these workers can continue paying off their mortgages.
By supporting low mortgage rates by strengthening confidence in Fannie Mae and Freddie Mac,
providing up to 4 to 5 million homeowners with new access to refinancing and enacting a
comprehensive stability initiative to offer reduced monthly payments for up to 3 to 4 million atrisk
homeowners, this plan – which draws off the best ideas developed within the Administration,
as well as from Congressional housing leaders and Federal Deposit Insurance Corporation Chair
Sheila Bair – brings together the government, lenders and borrowers to share responsibility
towards ensuring working Americans can afford to stay in their homes.
THE WHITE HOUSE
Washington
February 18, 2009
2
Homeowner Affordability and Stability Plan
1. Refinancing for Responsible Homeowners Suffering From Falling Home Prices
2. A Comprehensive $75 Billion Homeowner Stability Initiative

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