Housing Crisis

Foreclosure Plan a Bust Already?

"Only good if you have a job."

President Obama's two-pronged foreclosure plan may have some initial support, but it's unlikely to aid many suffering homeowners in California. Obama's plan, which will allow people who are current on their mortgages to take out new loans with lower rates for up to a 105 percent value on their home, doesn't take into account thousands of homeowners who owe more than 105 percent, according to the Los Angeles Times. The plan's other component—paying mortgage companies to cap loan payments at 31 percent of a homeowner's total income—will only apply to those able to make payments, and with the unemployment rate sitting at 10 percent, the field of those who will benefit is narrowed significantly.