Homeowners find loan aid is limited

June 26 2008 - Lenders and loan-servicing companies say foreclosing on distressed homeowners is the last thing they want to do.

Federal Reserve Chairman Ben Bernanke has urged them to modify loan terms instead of going through the costly process of evicting homeowners and reselling their dwellings. He said writing down some debt now would be cheaper for lenders and investors in mortgage-backed securities than the alternative.

And Congress is considering a measure that would give lenders further incentive to modify loans by insuring up to $300 billion in loans for at-risk borrowers if lenders agree to lower the balances.

Homeowners find loan aid is limited
by Emmet Pierce | SAN DIEGO UNION-TRIBUNE