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29 Oct 08 FDIC Unveils Incentives to Mortgage Industry to Modify Mortgage Loans

Federal Deposit Insurance Corp. Chairman Sheila Bair announced that the agency has created a program to offer economic incentives to the mortgage industry to modify loans and aid borrowers prevent foreclosures.  Speaking at the Annual Conference of the International Association of Deposit Insurers in Arlington, Virginia, Bair said, “Such a framework is needed to for loan modifications on a scale large enough to have a major impact.”

Bair appealed for a “smarter” oversight of leveraging and a greater transparency in the financial industry. Bair also called for a major overhaul of financial and home financing regulations, describing current loan programs as “too balkanized.” “We need lending guidelines and meaningful enforcement of those rules that apply across the board,” Bair said.

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