The widely discussed economic rescue plan, commonly called The Bailout, will help to backstop much of the nation’s troubled debt, but many questions remain unanswered as specific details on the plan are scarce. But, experts say, mortgage servicing and collections will play a big role in the program.
The “Economic Recovery Amendment to the Paul Wellstone Mental Health Parity Act” (H.R. 1424) is ostensibly an economic stabilization plan that authorizes the Treasury Department to purchase up to $700 billion in “troubled assets” from the nation’s financial institutions. To do this, Treasury is setting up an entity called the Troubled Asset Relief Program (TARP), similar to the Resolution Trust Corporation that helped liquidate assets of institutions caught in the savings and loan crisis of the late 1980s.
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