New plan would help all homeowners at risk of foreclosure

WASHINGTON - The government and lenders are getting together to help to all homeowners at risk of foreclosure, not just those with sub-prime loans.

The Bush administration this morning will announce a program called Project Lifeline. It would allow seriously overdue homeowners to suspend foreclosures for 30 days while lenders try to work out more affordable loan terms.

Six of the largest lenders will participate in the plan.

The same banks are taking part in the Hope Now program which was initiated late last year. That plan freezes rates on some high-cost sub-prime mortgages for five years.

Consumer groups are skeptical. They claim many borrowers still can't keep up with payments even after loan workouts. The groups claim a full-fledged refinancing at a lower rate would be better for borrowers.