The United States on Wednesday (March 4) announced the launch of mortgage plan to stabilize the housing crisis in the country that happens to be the main cause of recession. Last month, US President Barack Obama announced a $75-plan so that over 9 million homeowners in US could pay off their mortgages and avoid foreclosure. The US treasury came out with the details of the plan on Wednesday. The plan is expected to enable the private lenders to ease out the burden on beleaguered homeowners.

 

The newly announced initiatives are expected to stop the progress of an unprecedented number of foreclosures that severely affected the US financial sector as firms lost hundreds of billions of dollars in mortgage-related investments. It is estimated that in 2008, the number of foreclosures in US has reached to 3 million mark.

 

Under the new rescue plan, the refinancing efforts of government- chartered lenders Fannie Mae and Freddie Mac will be expanded by US treasury. Treasury secretary Timothy Geithner stated that, it is important to move rapidly with the plan so as to sort out the housing crisis and make it more affordable. The plan has been designed to curb the damaging spiral in US housing markets. Over the past year or so, US home prices have fallen nearly 20 percent as result, millions of homeowners owe more on their mortgages than their property is worth. Thereby it prevented them to sell or refinance the property.