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Nearly a year into his tenure as director of the agency that oversees Fannie Mae and Freddie Mac, Mel Watt is being asked to formally end the policy of prohibiting mortgage modifications that reduce the balance of principal.
Real Estate, Education And Community Housing, Inc. (R.E.A.C.H.) is one of the more than 200 organizational signers of a letter, delivered today, urging Watt to reverse the Federal Housing Finance Agency’s longstanding ban on principal reduction – a policy put in place by his predecessor.
Patricia Tracey- R.E.A.C.H. Executive Director, states “principal reduction will increase family stability and restore equity rights to families in our Community, especially the hardest hit families of color.”
Despite widespread discussion of housing recovery, about 9.8 million households (one in five of those with mortgages) owe more on their loans than the current value of their properties, according to one recent study. The proportion is far higher in some parts of the country (including Las Vegas, Atlanta, Jacksonville, Orlando and Chicago), and higher still, as a rule, in communities of color. African-Americans and Latinos account for at least half of the residents of most of the hardest-hit ZIP codes around the country.
Posted On: November 03, 2014
