Government Formulating New Homeowner Aid Plan

Officials from the Treasury Department, the Federal Deposit Insurance Corp. and the Bush administration are in discussions regarding a new plan designed to allow struggling homeowners to remain in their homes.

The initiative will potentially be the most sweeping government effort aimed at borrowers, according to the New York Times. Under the terms of the plan, servicers would lower borrowers' monthly payments for a minimum of five years, and the government would take half the losses on those loans.

Costs were estimated at $40 billion to $50 billion.

Source: New York Times

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