Citi unveils housing relief plan

Banking giant steps up efforts to avoid foreclosures

November 11 2008 - Citigroup Inc. on Tuesday released details of a plan that it said will help mortgage borrowers remain in their homes.

Citigroup said that under the Citi Homeowner Assistance program, it would preemptively contact 500,000 mortgage holders — involving $20 billion of mortgage balances — to try to ensure that they can pay their loans. It said it is focusing on borrowers who live in areas that are likely to face “extreme economic distress.”

Citi also extended its moratorium on foreclosures, saying it won’t begin or complete a foreclosure sale on a home on which it owns the mortgage if the borrower wants to stay in the home, which is his or her principal residence. Citi said it will also need to be sure the borrower is working in good faith with the bank and has enough income for affordable mortgage payments.

“Under our new program we will preemptively reach out to help homeowners before they become delinquent, which is critical to avoiding the loss of a home and protecting their credit score and future borrowing potential,” said Sanjiv Das, chief executive officer of CitiMortgage.

Citi unveils housing relief plan
by Sam Mamudi | MarketWatch