Financial Aid Program to Abate Foreclosures Problem Still Work in Progress
Timothy Geithner, a Treasury Secretary nominee, is reportedly working with Larry Summers, a top economic adviser under the incoming Obama Administration, and other officials to revise some details of the Troubled Asset Relief Program (TARP).
The $700 billion TARP is aimed at halting the flood of foreclosure properties and boosting credit flow to help in the recovery of the struggling United States economy.
It is expected that a part of the TARP bailout fund would be used to help homeowners who are facing the threat of foreclosures.
The economic team is also trying to develop ways to expand TARP to help provide loans to small businesses, consumers and municipalities.
Under the program, the economic team is considering giving the Obama government more shares in financial companies. However, financial firms that will receive funding will be facing more limitations on executive compensation.
On the other hand, Geithner is planning to create a bureau within the Treasury Department to manage TARP.
According to outgoing Treasury Secretary Henry Paulson, President-elect Barack Obama will decide on how best to apportion the remaining 50 percent of the bailout fund. Paulson allocated over $350 billion of the money for loans to automobile manufacturers and investments in financial companies. The issuance of the remaining 50 percent of the bailout fund still needs approval from the Congress.
Paulson has been criticized by some lawmakers for his decision to use over $350 billion of the bailout funds to boost financial institution.
Some Democrats are insisting that a part of the remaining bailout funds should be used in providing aid to homeowners of distressed properties to help the housing market recover from the effects of the foreclosure crisis.
Meanwhile, a report released by a congressional panel has criticized the way the Treasury handled the TARP, claiming that it failed to provide aid to homeowners facing foreclosures, neglected to disclose its strategy on how to stabilize the financial market and failed to consistently monitor usage of the funds.
Related Posts:
- Foreclosures Rages on as Bailout Plan Fizzle out
- Banks Said That Bailout Cash is for Foreclosure Loans not Payments
- A Perspective on the Foreclosure Control Initiative
- Obama Gearing for Foreclosure Prevention
- Useless Solutions to Foreclosure Crisis
