"Obama extends Extends Mortgage-Free Living For the Unemployed"

Note you only get this subsidy as long as you live in the house. You can't rent it out. This creates the incentive for people to keep living in places that they can't afford. It also makes it costly for people to move to where the jobs are. More of a discussion on this is available here:

The Obama administration is making it easier for out-of-work homeowners to stay in their homes, as it tries to revamp its troubled foreclosure-prevention program.

Starting Aug. 1, the Federal Housing Administration will extend the period for unemployed homeowners to miss mortgage payments to a full year from three or four months. That will allow qualified homeowners to go without making a monthly payment for 12 months before the foreclosure process begins.. . . .

More than 1.6 million troubled homeowners received trial modifications over the past two years. But a majority of the applicants, about 854,000 homeowners, have dropped out of the program entirely. . . .

He acknowledged that the government’s programs to help homeowners were “not enough” and said the administration was “going back to the drawing board.”

Homeowners accepted into the foreclosure assistance program receive interest rates as low as 2 percent for five years. They can repay their loans over a longer period. The median savings for those who remain in the program is about $526 per month.

Those who have their payments delayed must repay them, with interest.

But many homeowners have complained that the program has been a bureaucratic mess. Some have said they were disqualified after banks lost their documents and failed to return their phone calls. Banks have blamed homeowners for failing to submit needed paperwork.

Last month, the Obama administration blamed the three largest U.S. mortgage lenders for the failures of the foreclosure program, saying they hadn’t done enough to help people at risk of losing their homes. . . .