Major Banks Announce Halt in Foreclosures for One Month; Await Obama Plan Details

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As the spending stimulus package passed the House and Senate on Friday, lenders large and small took action to stem the tide of foreclosures (1 every 13 seconds) until more details were revealed about President Obama’s $50 billion plan (that’s the portion of the stimulus devoted to foreclosures, according to the AP).

Fannie Mae, Freddie Mac, JPMorgan Chase & Co., Morgan Stanley, Citigroup Inc. and Bank of America Corp said they were halting foreclosures for at least a month on Friday, followed by many smaller banks around the country.

This amounts to a triage until they can come up with a permanent solution,” said Anne L. Weintraub, a Sarasota attorney who specializes in real estate. “Banks are finally trying to come up with an alternative to foreclosure because it’s expensive and they don’t want to become property managers.

I hope the good folks making these decisions (politicians, big banks, etc) realize the implications on the business of lending that their actions will have. The incentive to lend money is fast disappearing . . . I better collect on the $10 bucks I lent to my buddy before that is also deemed unfair by the government!

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Joshua Dorkin

Joshua Dorkin is a serial entrepreneur, investor, podcaster, publisher, educator, and co-author of How to Invest in Real Estate. He started BiggerPockets to help democratize the real estate investing landscape for himself and others, aiming to make it accessible for everyone, regardless of income or education. Today, BiggerPockets is the premier real estate investing website online with over one million members and reaching over 70 million people with the message of financial freedom through real estate investing. Joshua, along with his wife and three daughters, make their home in Denver, Colorado, and spend any time they can traveling, exploring, and adventuring. Read more about Joshua’s story in 5280 and


  1. About the stimulus,I rather hold it with my faith,what Obama says about the stimulus.perhaps works and perhaps dont,however with his decision to try to get out of the crisis ,I certainly sure it will bring hope.,and I dont think we need more then it for now,just wait and lets see.

  2. No one knows what the plan actually is Sam. Supposedly we’ll hear all the details on Wednesday but if it is like the other plans that we’ve seen out of DC, it is just going to be another out of control spending disaster.

  3. I’m with Dave Francis on this one — why should I even bother to pay MY bills on time, if the people that don’t get a reward? It seems like another instance of putting a Band-aid on a bad wound instead of actually fixing what’s wrong.

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