Obama to unveil foreclosures plan

WASHINGTON, (AFP)

US President Barack Obama will outline a plan to tackle the home foreclosure crisis during a visit to the western state of Arizona next week, White House spokesman Robert Gibbs said Friday. The president will travel to Denver, Colorado on Tuesday to speak about his economic recovery plan, set to finally clear Congress later Friday, and then later go to Phoenix, Arizona to stay overnight, Gibbs said.

“On Wednesday, the president will give a speech and outline a plan to stem home foreclosures,” Gibbs said.Gibbs did not give further details of the plan that the president will lay out, but tried to ensure rising expectations would not result in disappointment on the markets, as happened with a banking bailout plan this week.

“I would wait until Wednesday to see what the president offers and be careful that we don’t set an unreasonable series of expectations based on leaks from God only knows where,” Gibbs said.

The announcement followed reports this week that the administration is planning to use public money to lower monthly payments for homeowners about to fall victim to foreclosures.

The plan would be designed to cut the numbers of Americans who lose homes, by helping them before they fall behind with payments.Earlier Friday, US banks Citigroup and JPMorgan Chase announced Friday moratoriums on home mortgage foreclosures as the government prepared to roll out its plan next week.

JPMorgan Chase chief executive Jamie Dimon told key Democratic congressman Barney Frank that the bank stood ready to help the government “reduce the incidence of foreclosure and to encourage long-term, sustainable home mortgages.”

He told Barney Frank, chairman of the House of Representatives financial services committee, that his bank would impose a foreclosure moratorium through March 6, according to a copy of the letter.

“We believe three weeks is adequate time for the Treasury to announce — and for us to implement — a new plan,” the letter said.

Citigroup said its moratorium could last until March 12.Since the beginning of the home mortgage crisis in 2007 that sparked global financial turmoil, Citigroup has worked with about 440,000 homeowners to help potential foreclosures representing about 43 billion dollars, the bank said.

The Treasury said this week that it would commit 50 billion dollars to prevent home mortgage foreclosures.