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Project Lifeline: A Few Feet Shy

The new initiative, in which six major lenders agree to delay foreclosure in some cases, represents business as usual for the banks, and little relief for homeowners

As the foreclosure mess worsens, there's mounting public pressure for stronger action to keep people from losing their homes. But President Bush and his Cabinet have resisted the more aggressive forms of intervention, preferring to rely on the private sector as much as possible. That's raising questions about whether the White House is fully aware of the severity of the housing crisis.

The Bush Administration's latest initiative, Project Lifeline, exemplifies its hands-off approach to the workings of the market. In fact, it's not a government program at all. It's a statement of intent by six major lenders—Bank of America (BAC), Citigroup (C), Countrywide Financial (CFC), JPMorgan Chase (JPM), Washington Mutual (WM), and Wells Fargo (WFC)—that they will stop the clock on foreclosure for 30 days for borrowers who are identified by the lenders as good candidates for a home-saving workout. The banks, in the words of a Bank of America press release, "will target severely delinquent borrowers to encourage them to respond to their mortgage servicer and pursue loan modification options."