Good morning. Thank you for coming. In the past few months we have witnessed a change of thinking, a new approach to lending practices by the mortgage industry. Twenty-six of the nation's largest lenders are working with each other and with non-profit housing counselors to reach out to existing homeowners facing default and foreclosure. This spirit of cooperation, the sharing of best practices and resources, is unprecedented in the mortgage industry. I applaud the new approach.
Homeowners are the real beneficiaries. Homeowners are learning that informative communication can make a profound difference.
So I am pleased to join Secretary (Henry) Paulson to announce "Project Lifeline." This is another positive, powerful way to address the housing crisis. Today, six Hope Now Alliance members are launching an effort to help families find solutions to foreclosure. Project Lifeline is a valuable response...literally a lifeline...for people on the brink of the final steps in foreclosure. For many families, Project Lifeline will temporarily pause the foreclosure process long enough to find a way out. Loan modifications may follow. And, this program is not only available to subprime borrowers but to people with any kind of home mortgage.
This is a responsible, timely effort. A recent survey found that most homeowners are generally unaware of the options available to them when they are having trouble making a payment. They need more information. They also need to stay in touch with their mortgage lender. Only about half of those in the foreclosure process have spoken to their lenders. The industry needs effective lines of communication, to let those in trouble know that help is available, that people do not have to silently suffer through foreclosure. Project Lifeline is an important start.
Let's place today's announcement in perspective. We are at a decisive moment in our economic history. We need wisdom, courage, and a sense of urgency. The actions we take right now ... right now...will determine our short-term prosperity and set the foundation for our future, long-term economic success. We need to craft responses that are immediately effective and also work to smooth out the volatile housing cycle.
And let's be clear and honest. One action alone will not solve every problem in the housing market. Rather, a series of incremental steps provide the best chance, maybe the only chance, for serious, on-point solutions that directly address the complex problem we face.
Several recent efforts have been extremely helpful, including the President's actions with FHASecure. Since September, when President Bush announced FHASecure, the department has received applications to refinance more than 228,000 conventional loans into safe, affordable FHA products. More than 5,000 of these families were already in default and facing foreclosure on their subprime loans. Fourteen hundred lenders have used FHASecure to help struggling homeowners. With the passage of the President's Economic Stimulus Package, they can help thousands more families because of the increase in FHA loan limits in high cost areas. And if Congress approves bipartisan legislation to modernize the FHA, we could help 250,000 more families. Finally, just last week HUD started sending out letters to more than 850,000 targeted homeowners, urging them to consider refinancing high cost subprime loans with FHA.
I also appreciate the industry's efforts to freeze mortgage interest rates under the Hope Now Alliance. And I thank the FBI for prosecuting lenders who have been predatory. This sends a message throughout the industry: predatory, illegal practices will not be tolerated.
The sum total of these actions is a powerful correction to the downward spiral of the housing market. It will lead to a reversal of misfortune, saving homes and equity, providing necessary sanity and salvation for many families on the brink of foreclosure, families facing the despair of lost equity and disrupted lives. For in the final analysis, we must step forward to help people because we care, because they need our help, and because it is the right thing to do.
History will judge our efforts, but we will also be judged in our hearts. At this decisive moment, let us remember that the people who need us are our friends and neighbors, the people we see at the grocery store, and the people picking up their kids from school, the people we work with, the people with whom we share our lives. Their homes are usually their most important investment and the fulfillment of a dream. When we save a family from foreclosure, we strengthen our communities and neighborhoods.
We step forward to help because we should...because we must.