December 5th, 2008
08:45 AM ET

Foreclosure for Christmas?

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/11/26/art.foreclosuresign.jpg]Mary Kane
The Washington Independent

This is supposed to be the season for a break in home foreclosures, a pause in evictions over the holidays.

But it’s not working out that way for everyone. And certainly not for Julio Angulo of suburban Virginia, another victim of a foreclosure machine that seems to be almost unstoppable.

To great fanfare, mortgage giants Fannie Mae and Freddie Mac announced last month they would temporarily halt foreclosures and evictions from Thanksgiving to Jan. 9. One analyst called the move “a giant timeout” to help people stay in their homes while they try to get their loans modified. The decision also avoids the spectacle of two government-controlled finance companies throwing families out on the street at Christmas time.

Days before, Fannie Mae and Freddie Mac unveiled a major rescue plan to streamline modifications of loans to make them more affordable for potentially hundreds of thousands of borrowers. Banks including JPMorgan Chase and Bank of America also suspended foreclosures while trying to restructure troubled homeowner loans.

And Monday, Treasury Secretary Henry Paulson said for the first time that he would consider using money from the $700-billion Troubled Asset Relief Program to help avoid foreclosures.

But nothing seems to shut down the foreclosure machine — at least so far.


Filed under: 360° Radar • Economy • Housing Market • Mary Kane