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Weeds have taken over a row of vacant, new homes Tuesday, Feb. 17, 2009 in Gilbert, Ariz. With one of the highest foreclosure rates in the country, Arizona makes a fitting backdrop for President Barack Obama's new housing program, to be unveiled Wednesday. (AP Photo/Matt York)PHOENIX-President Barack Obama's plan to tackle the foreclosure crisis will spend $75 billion in an effort to prevent up to 9 million Americans from losing their homes.The plan, which Obama is releasing later Wednesday,is more ambitious than initially expected—and more expensive. It aims to aid borrowers who owe more on their mortgages than their homes are currently worth, and borrowers who are on the verge of foreclosure.The initiative is designed to help up to 5 million borrowers refinance, and provides incentive payments to mortgage lenders in an effort to help up to 4 million borrowers on the verge of foreclosure."All of us are paying a price for this home mortgage crisis," Obama says in a prepared text of remarks scheduled shortly after 12 noon EST Wednesday at a Phoenix area high school.Headlining the plan was a $75 billion Homeowner Stability Initiative, under which would provide incentives to lenders to cut monthly mortgage payments to sustainable levels. It defines this at no more than 31 percent of a homeowners income.Another key component: a new program aimed at helping homeowners said to be "under water"—with dwellings whose value have sunk below the principal still owing on their mortgages. Such mortgages have traditionally been almost impossible to refinance. But the White House said its program will help 4 to 5 million families do just that.Announcing his plan in a state hard hit by the housing crunch, Obama said that stemming the tide of foreclosures is key to turning around the recession-bound economy."In the end, all of us are paying a price for this home mortgage crisis. And all of us will pay an even steeper price if we allow this crisis to deepen," he said, according to the advance text.
By MARK S. SMITH and ALAN ZIBEL--Associated Press Writers
As in the days of Noah...
