The Bush administration plans to expand the FHASecure program, which is designed to help troubled homeowners keep their homes, to bring the total number of borrowers enrolled in the program to about 500,000 by the end of the year, reports the Wall Street Journal.
The expansion involves encouraging lenders to write down loan value while shifting default risk to the government as the Federal Housing Administration (FHA) insures a new mortgage.
This effort is likely to be met with opposition from Democratic lawmakers, the article notes. FHASecure has already been widely criticized by lenders and many Democrats, who claim it has helped fewer than 3,000 delinquent borrowers and that the majority of borrowers in the program would have qualified for government insurance.
The Department of Housing and Urban Development, however, maintains that the program has been successful in aiding homeowners before they become delinquent.
