Plan to Aid Borrowers Is Greeted by Criticism

New York Times (02/13/08) P. C4; Grynbaum, Michael M.
The Bush administration--with the support of Bank of America, Citigroup, Countrywide Financial, Wells Fargo, Washington Mutual and JPMorgan Chase--launched Project Lifeline on Feb. 12. The program will allow borrowers whose mortgage payments are three months or more late to request a 30-day halt in foreclosure proceeds while they seek loan modifications. Lenders are not required to change the borrower's loan terms, however, and homeowners cannot participate in the program if they will be bankrupt or in foreclosure in a month's time. The effort is being criticized for failing to go far enough, with experts insisting that just a fraction of the 425,000 borrowers who qualify for the plan will receive assistance. According to Sen. Charles Schumer, D-N.Y., "It is encouraging that lenders and servicers are willing to temporarilyy pause foreclosures, but only meaningful and long-term loan modifications will help keep people in their homes."