Banks halt foreclosures; Obama to outline plan

WASHINGTON -- The biggest players in the mortgage industry are halting home foreclosures while the Obama administration develops its plan to help struggling homeowners.

The White House said Friday that President Barack Obama will outline his much-anticipated plan to spend at least $50 billion to prevent foreclosures in a speech Wednesday in Arizona, one of the states hardest hit by the foreclosure crisis.

"It's not intended to be measured by one day's market scorekeeping, but instead to ensure that the 10,000 Americans each day that have their homes foreclosed on, and the millions more that are barely getting by, are protected," White House press secretary Robert Gibbs said Friday without providing other details.

Treasury Secretary Timothy Geithner announced a revised effort to stabilize the financial system on Monday. It contained outlines of a foreclosure-relief effort, but few details.

Though lenders have beefed up their efforts to aid borrowers over the past year, their action hasn't kept up with the worst housing recession in decades.

More than 2.3 million homeowners faced foreclosure proceedings last year, an 81% increase from 2007, and analysts say that number could soar as high as 10 million in the coming years, depending on the severity of the recession.

JPMorgan Chase, Morgan Stanley and Bank of America said Friday they are halting foreclosures through March 6. And Citigroup said its halt will extend until the administration has completed the details of the loan modification program or March 12, whichever is earlier. Citi's action expands on a similar effort that it started in November.

The banks' pledges apply to owner-occupied homes, not those owned by investors.

Fannie Mae said it was suspending all foreclosure sales and evictions for occupied properties, while Freddie Mac said its suspension would apply to properties with up to four units and noted that the ban would not apply to vacant properties.

Both Fannie and Freddie had suspended foreclosure sales during the winter holidays and halted evictions from foreclosed properties through the end of this month. Together, they own or guarantee around half of U.S. home loans.