Lenders And Bush Administration Are Getting Closer To Subprime Rate Freeze Agreement

From The Wall Street Journal:

“The plan is being negotiated between regulators including the Treasury Department and a coalition of mortgage-related companies including Citigroup Inc., Wells Fargo & Co., Washington Mutual Inc. and Countrywide Financial Corp. People familiar with the talks say the individual members have agreed to follow any agreement reached by the coalition, which is called the Hope Now Alliance.

Details of the plan, which could be announced as early as next week, are still being worked out. In general, the government and the coalition have largely agreed to extend the lower introductory rate on home loans for certain borrowers who will have trouble making payments once their mortgages increase.”

From Conde Nast Portfolio:

“American Banker reports that the plan being discussed among Bush administration officials and the financial institutions involves extending the introductory interest rates for five years on nondelinquent subprime hybrid adjustable-rate mortgages. Financial institutions have been pressing for a three-year time frame, American Banker says.”

From Bloomberg:

“Paulson, who will address a housing conference on Dec. 3, presided over a one-hour gathering at the Treasury Department in Washington with federal regulators, bankers and lobbyists. Citigroup Inc., Wells Fargo & Co. and Washington Mutual Inc. executives attended, said a person present, who spoke on condition of anonymity.”