New Administration Pledges to Use TARP Funds for Foreclosure Relief

President-elect Barack Obama was continuing to lobby lawmakers today to release the remaining $350 billion in Troubled Asset Relief Program funds, pledging to use part of the money to provide relief to mortgage borrowers facing foreclosure. But what form a so-called “borrower bailout” might take remained unclear. Fed Chairman Ben Bernanke yesterday also promised that some of any new TARP money would go to foreclosure relief and pointed to the FDIC’s loan modification initiative as one possible administration-blessed approach.
Separately, House Financial Services Committee Chairman Barney Frank, D-MA, has introduced new TARP-related legislation that calls for an overhaul of the FHA’s slow-moving HOPE for Homeowners program as well as a new program guaranteeing loans made under the FDIC’s loan mod approach. Both H4H and the FDIC’s loan mod program will be reviewed in detail at an Inside Mortgage Finance audio conference tomorrow, Jan. 15, at 3:30 pm EST.