"WASHINGTON - At-risk borrowers with all types of mortgages, not
just high-cost subprime loans, could be eligible for help under a new
plan involving six big home lenders. The plan, called Project Lifeline,
will be announced Tuesday by the Treasury Department and the Department of Housing and Urban Development,
said a person familiar with the plan who confirmed earlier news reports
about the plan but spoke on condition of anonymity because it had not
yet been made public.
a backdrop of surging defaults and administration officials' prodding
of the mortgage industry, the plan will allow seriously overdue
homeowners to suspend foreclosures for 30 days while lenders try to
work out more affordable loan terms.
On a pilot basis, the plan will involve six of the largest mortgage
lenders, in hopes that more lenders will sign on. The participants are Bank of America Corp., Citigroup Inc., Countrywide Financial Corp., JPMorgan Chase & Co., Washington Mutual Inc. and Wells Fargo & Co.
All six are involved in Hope Now, an effort the Bush administration
brokered with the mortgage industry late last year to freeze rates on
some high-cost subprime mortgages for five years to aid borrowers whose
teaser rates are jumping sharply higher. Since then, Treasury Secretary Henry Paulson has urged lenders to expand that effort to cover struggling homeowners with conventional mortgages."