This is a direct quote taken from Yahoo Finance this morning:Fannie Mae, in a new program called “HomeStay,” is offering new options so that lenders can help sub prime borrowers refinance out of high-interest adjustable-rate mortgages or other difficult loans, said President and CEO Daniel Mudd. He said the company plans to stretch the term on sub prime loans to 40 years from the current maximum 30 years — which will reduce monthly payments for borrowers by around 5 percent.About 1.8 million adjustable-rate mortgages are resetting to higher rates this year and next, making foreclosures sure to continue rising, according to a new report by Congress’ Joint Economic Committee.

      Areas said to be hardest hit by foreclosures include Indianapolis, Denver, Dallas and Detroit. Fannie Mae and Freddie Mac were created by Congress to pump money into the home-mortgage market by buying home loans from banks and other lenders and turning them into securities for sale on Wall Street. They have grown dynamically in recent years and now finance or guarantee some $4 trillion of home mortgages, representing about half of the single-family mortgages in the country.

     I do not think that lowering a monthly payment by 5% will make a difference for anyone, rich or poor.The unfortunate thing is that these people should not have had any mortgage in the first place.They could not afford it then and cannot afford it now.Even at a 5% lower monthly payment.There is no solution to what will come to the housing market in the near future.We will just have to wait and see how many folks jump ship and how it will affect the lending industry and the economy as a whole.